Paper Topic: Purchase Decision Criteria for Cloud Computing

I plan to explore the purchase decision criteria for cloud computing decisions.  I am curious as to whether the criteria are different between small businesses and enterprises (as they have been with software and hardware in the past), or if the economics of cloud computing make the purchase decisions more similar.

This topic is interesting and relevant to me as I plan to move into the marketing world at Microsoft—specifically working on Windows Azure and other cloud computing related products.  As this is a relatively “new” offering (at least in terms of how the products are now being portrayed and in terms of wide acceptance of cloud computing), I believe this topic is still in its infancy and has yet to be explored.  It is likely that the larger, established companies (like Microsoft) will attack the market at least in a somewhat similar manner to their successful past strategies.  Therefore, I hope to look into this from an outsider’s perspective before joining the company and falling into the trap of doing what has always been done without any good reason for doing so in what should be a new field.

Designing valuable customer experiences for a different type of customer base and a new product offering will be extremely important in the long term.  Microsoft (and the entire industry) believes cloud computing to be their highest growing revenue source over the next few years.  If companies do not accurately assess their customers’ needs and address them, they will quickly fall behind during a growth period.  That lost opportunity may not be something easily regained in the coming years, so it is extremely important to get it right now.

In “SMB and Enterprise All-Up Survey Findings” by Microsoft, they determined that 41% of Enterprises companies have at least one cloud project planned or underway, while Small and Medium Businesses (SMBs) are only at 16%.  So, SMBs haven’t embraced the business opportunity yet.  Additionally, Enterprises are more likely to be working on multiple cloud opportunities.  These facts will certainly change purchase decisions.  When looking at purchase decision makers, 55% of SMB IT decision makers claim to be primary decision makers, while responsibility in Enterprises is much more distributed across organizations.  Finally, only 20% of SMB IT decision makers claim to know cloud computing fairly well, while 41% of those in the Enterprise world claimed the same.

These are just some of the facts from a useful article.  I am sure there is more research that will help me address questions for both Enterprises and SMBs, including:

• What are the purchase decision criteria for cloud computing?
• Who are the decision makers?
• How large of a budget do they have available for a single cloud computing project on a per-user basis?
• What types of projects will differently-sized companies address?

Source: http://www.microsoft.com/presspass/download/features/2011/01-12CloudSurvey.docx

Social Media

When looking at our current state of Social Media, I think the majority of questions, polls, and other devices used to gain attention and “likes” are generating poor data.  Companies seem to be concentrating more on generating “likes” or something similar in order to tell their bosses or shareholders that they have X number of “likes”, which “typically” translates into Y dollars.  Instead, they should be working at generating affinity and showing them how to “like” their page—because generating somewhat fake numbers doesn’t drive sales in the same way as an organic “like”.

American Express has done a great job of integrating their social media with my life, and I believe that is a way to be successful.  They have made it easy for me to save money by integrating Facebook with my credit card, and they are using data from my Facebook page to help determine where I might like to use that credit card.  Companies must find ways to make it easy to use—people will not continue to come back or share with their friends (which is obviously the biggest key in a social network) unless the benefits are clear and easily realized.

Things a company should know about my social media use in order to help their brand:

•          How often I post
•          How many friends I have
•          How often my friends “like” or comment on things I post (i.e. if they read them and if my posts are valuable)
•          What brands I identify with
•          How much money I make
•          What my shopping habits are like
•          What affinity groups I am in
•          What types of events I attend

Extracting this information probably isn’t all that difficult.  To me, the more difficult problem is using the information effectively.  I think companies have much more of a problem interacting with people in a way that is social, personal, and brand-building at the same time than they do figuring out who to interact with.

Social Media has obviously been an exploding field over the last 15 years or so.  In that relatively short amount of time, the ways in which people have interacted with and engaged with the different social media outlets has changed dramatically—from online forums to Six Degrees to blogging communities to online gaming all before the ones we think of today (Friendster, LinkedIn, MySpace, Facebook, Twitter, etc.).  Since it, as a field, is something that is based on emerging technology, I expect that trend of change to continue.  Therefore, we should not expect social media, over time, to become stagnant—even in terms of a channel or method of use (though it is certainly tempting given Facebook’s massive market share and popularity).

This idea has numerous implications.  First and foremost, companies currently dominating the market (Facebook, Twitter) must constantly innovate—even more so than a typical technology company.  Startups, for the most part, are not trying to duplicate Facebook’s model and beat them.  Instead, they are trying to find the next great social outlet and beat Facebook to the punch.  For example, I don’t think Social TV necessarily has the ability to become a dominant, life-changing outlet in the social space—but if a company like Miso is integrated with cable set-top boxes (as it has already started doing), and if those set-top boxes begin to control entire living rooms or households, the story could very quickly change.

Additionally, marketers must determine whether this constantly evolving technology is something that will be able to appeal to the masses over time or not.  It seems like social media is something that is more often associated with younger groups—at least early on in a platform’s existence, and at least in some of its more sophisticated uses.  If technology constantly changes the way we interact with social media, there is a chance that we continue to freeze out older populations to these new channels.  Typically, the older people get, the more resistant to change they are.  With TV and radio as the typical advertising outlets over the past 75 years or so, we haven’t had to deal with changing outlets and that effect on the general population.  It may help keep slow-moving social media companies in business (i.e. if Facebook is slow to adjust), or it may counteract the evolving technology directly and work against the need to innovate.  Platforms may need to stay a bit stagnant in order to be attractive to the masses.

Third, marketers must not put all their eggs in the current social media basket.  That is, their marketing strategies that use these different social media outlets must be adaptable to vastly different ones that may come up in the future.  Or, if not, they must be prepared to scrap ideas that may currently seem invincible in favor of new, untested ones as new technologies emerge.

Persona - Monica

Monica is a 33 year old female who lives in suburban Los Angeles.  She is married and has 2 kids—a 3 year old boy and a 1 year old girl.  She grew up in New Jersey with her immigrant parents and a younger brother, and they were surrounded by numerous uncles, aunts, and cousins who lived in the same neighborhood.  After finishing college at a small school near home, she moved to LA.  Soon after, she got married.  While she and her husband initially lived in a more urban part of LA, they moved out to the suburbs as they prepared to start a family.

1. What does she think or feel?

Monica cares most about family.  She thinks about her children and husband first, and she is also a role model for her brother and numerous younger female cousins as the first in a family with many women.  She always needs to have something to do—she doesn’t deal with downtime for very long.  She is preoccupied with making sure her children are taken care of while also making sure she is successful at work.  She worries about her parents, grandparents, and in-laws as they all get older.  She also worries about managing her time commitments between her family and her career.  She aspires to be an ideal mom, wife, and career woman all at the same time, while also helping everyone in her extended family.

2. What does she see?

Monica’s environment is filled with family.  Her parents, in-laws, brother, and cousins are in and out of town constantly.  She has a nanny that comes daily to take care of her children, and that can be a source of stress at times.  She works at a large CPG company in a marketing capacity with very passionate employees who are excited about their company.  She sees her friends on a weekly basis, and most of these friends have children as well.  She has moved from being a more impulsive and free-spending shopper to a slightly more money-conscious shopper over time, especially with the addition of children to the family.

3. What does she say and do?

Monica’s attitude in public is confident.  She always appears to know what she’s doing and where she’s going.  Her appearance is generally fashionable.  While she was always current with fashion trends, she is now desperately trying to keep up with them—she lags behind due to the time she spends with her children and work, as well as weight gain during pregnancy changing clothing for periods of time.  Overall, her behavior towards others is extremely pleasant.  She is outgoing, and at a party, she enjoys attention from others.  At the same time, she doesn’t necessarily seek it out in a group; however, in a group of friends, the attention often finds her anyway given her outgoing nature and overall likeability (and she doesn’t shy away from it).  Additionally, her behavior towards others involves going out of her way to help her family and best friends in any way possible.

4. What does she hear?

Monica is an attentive listener, especially when it comes to important issues.  She is a sounding board for friends, siblings, cousins, and her husband, and they all see her as a problem-solver.  She relishes this role and is successful at it.  Her conversations with her friends typically revolve around things related to their children (schools, sleep patterns, feeding patterns), work-life balance, and their next girls trip (always discussed, but never happens).  Her conversations at work are strictly work-related (clients, technology, sales).  At home, she discusses work, kids, vacations, family, economy/politics, and current news trends with her husband (probably the biggest influence in her life).

5. What are her pain points?

Monica’s pain points center around people as much as the rest of her life does.  She wants her children to have the ideal life, go to great schools, and have good friends.  She will do whatever necessary to make sure that happens.  She also wants to make sure everyone in her family is healthy and as successful as possible—whether that means mentoring her cousin, making sure her parents are happy, or giving advice to her in-laws.  At home, she wants to make sure her nanny gets along with her entire family while also performing her job adequately.  At the same time, she worries about her husband’s balance between work/travel and being at home with the family.  Monica’s own career comes last amongst these pain points, but it is still important to her.  She has a drive to be successful rather than simply making money to help support her family, but she is not willing to travel for work or sacrifice family obligations in order to do so.  Overall, there is a theme to her pain points, and it is balancing everything in her life.

6. What does she hope to gain?

Monica wants everyone important in her life to be happy.  She wants her children, husband, and extended family to have happy and successful lives.  She wants her kids to grow up in a healthy environment and have as many opportunities as possible.  She wants to be successful in her own career, but not at the expense of her family or anything at home.