Thursday, June 21, 2007


Large IT vendors continue to blunder in targeting the small business market.

ConnectIT, an email newsletter for the computer channel community published by Richmond Hill, Ont-based Integrated, takes IBM to task for not respecting the uniqueness of the SME market. A June 20 story by Paul Weinberg quotes Wayne Kernochan, senior IT analyst at New Hampshire research firm Illuminata Inc., as saying, “I continue to sense that some vendors don't feel the SMB market is worthy of focus."

He noted that IBM has only managed "modest success" in its push with SMB-targeted products and services, because it has concentrated on the upper level of SMB (which includes far fewer firms than the small-business mainstream).

Kernochan also points to IBM’s Informix division, which he says pumped one release of database software “indiscriminately” into the channel without distinguishing between large enterprises and SMBs. As a result, "The SMBs didn't see much value in it."

Neglecting the small truths of the small business market can be expensive. Kernochan says Informix took six months to recognize its error, “but by then the financial damage to the company had already occurred.”

Although big companies say they value the small business market, he urges IT vendors to do more to reach that type of customer. "Vendors have to figure out how to get at that market in a cost-effective way. They tend to focus their innovation efforts on the large enterprise market."

Kernochan urged IT vendors to broaden their channel coverage beyond VARs and resellers, and reach out to SMB-oriented independent software vendors (ISVs) or solution providers.

He says technology products for small business have to be simpler to use and require less administration. And he warns that small business’s dissatisfaction with the IT industry is “getting higher and higher.”

This article suggests that the solution for big companies such as IBM is the same as that for everyone targeting small business. Acknowledge the special characteristics of this market. Don't dumb your products down: just make them easy to sell, easy to understand and easier to use. Recognize that these customers are intelligent professionals, but not specialists.

And understand that no matter how big you are, you only have one chance to prove yourself.

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