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Smart startups and scale-ups know how to invest wisely for growth. But when in a down economy, new challenges emerge.
Budgets are cut, and belts are tightened. Customers and investors get even more selective. But the dream persists, and somehow, someway, you must keep your momentum going.
Industry analysts (e.g., Gartner, IDC) can help. They play an important role in the B2B technology ecosystem. These firms study the market, develop influential reports, advise buyers about their technology purchases, and advise vendors on how to thrive. All ways they help you in lean times.
Analysts impact buyers in ways that impact emerging vendors in a down economy
In a down economy, two major factors converge that drive up buyer engagement with analysts.
- Enterprises get skittish about technology investments. They carefully look for solutions that solve their problems.
- On the other hand, some enterprises see the downturn as an opportunity to grow and they seek new innovative ideas. They are very open to recommendations from little-known vendors.
Analysts come into play in both scenarios. The volume of buyer inquiries that they take grows significantly in a down economy.
Analyst relations
When an analyst considers you a trusted company with a valid solution, you can be part of their coverage and conversations. If they know you. If you’ve shown them how your solution is compelling and differentiating. If they understand the problems that you solve and for whom… in other words, if you’ve built a strong, beneficial relationship.
My introduction to the analyst community is a great example of the benefit. I was working on a business strategy for my company’s customer reference program and consulted an analyst. I assumed we’d use one of the big tech solutions in the field, but after a probing discussion about our mission and needs, the analyst recommended an unknown (to me) startup that could do our job better. The analyst introduced me to the startup’s CEO, I was impressed, and we sealed the deal. Everybody won – the startup, the analyst, and my company – and I discovered the power and influence that analysts can bring to commerce.
Analyst value is potent
Analysts can be more effective than alternatives like more marketing spend and stepping up sales efforts. It helps to view them as partners in your growth.
While analysts help with strategy, product, messaging, and more, there are two areas that bubble to the top when things are tight:
Sales when the economy is down
Of course, you always need sales, and it gets tougher when buyers are running scared. Analyst conversations with buyers (hundreds a year) lead to vendor opportunities. Consider this: an analyst talks about interesting new vendors because it raises his value in the mind of the buyer. The analyst becomes a knight in shining armor when he points out hot, innovative, disruptive ideas. The buyer takes notice and appreciates it. And you get excited new prospects to fill your funnel.
In my previous life, I was the in-house AR professional for a European vendor trying to break into the North American market. They got wind of a huge NA enterprise deal, but couldn’t get in the door because they had no brand recognition and a very small client base. It was my job to engage an analyst and I found the right one who would advocate for us. That got us on the list of potential vendors and we eventually won the deal. The analyst relationship was the key that opened the door to the North American market.
Go-to-Market (GTM)
When the economy is down and resources are tight, you need to be razor-sharp on your GTM plan. The more tightly you segment the market, tailor the sales strategy, launch marketing programs, and price the product, the more guidance you need to get it right. Also, analysts understand your market in-depth and can help you make the hard decisions that can shortcut your path to success.
One of my clients, a cybersecurity startup, struggled with positioning and messaging. They invested in a small commercial arrangement with an analyst firm and held in-depth discussions. This helped the startup clarify its story and refine its use cases to better address the potential market. This was a prime example of an analyst fast-tracking a startup’s success.
Analysts give you unique inspiration
Remember, analysts sit at a critical intersection:
- First, they study a specific technology space, an industry, or geography, and build expertise.
- Second, they study and consult with end users and build a deep knowledge of buyers’ challenges and needs.
- Third, they study your competitors and have a very good view of their capabilities and value propositions.
- Fourth, they advise investors on market trends and vendor viability.
It’s a lofty perch… and with all that insight they can be a powerhouse when you tap into them properly. This is always true, but it is a gift when you have limited resources.
Image credit: Prophix Blog
Little budget, down economy, no problem
Worried about costs? You don’t have to be. Working with analysts does not mean breaking the bank.
- Start small. Identify the right analysts and brief them thoroughly. That’s free. It’s a no-brainer and gets you on the map. You can also infer good feedback from their questions, response, and interest.
- As your relationship with the analyst community evolves and you start to see the value, you’ll invest in relationships that can offer you clear ROI. You get much deeper insights and guidance and make continuous pivots and adjustments to your business. And that leads to more growth.
Another client is a tiny, innovative startup that solves employee engagement challenges. Because of the disruptive nature of the approach, analysts were extremely interested and we briefed many of them. Without spending a dime, the vendor amplified its message, received coverage, and was featured on an analyst podcast. This is an example of the success that can be achieved with very little investment.
Take advantage sooner than later
AR is an essential tool that is generally underutilized and poorly understood. It has the potential for a tremendous return on investment and is an essential weapon in the battle for market share. Use this weapon when times are good. Use it even more when money is tight and in a down economy. You won’t regret it.
Robin Schaffer, Schaffer AR, has a long history of providing analyst relations services to vendors, large and small. Additionally, her team focuses on the unique value of industry analysts to the startup/scaleup community, helping emerging vendors gain tangible results. She is the author of Analysts on Analyst Relations.