Software firms learn best routes to market

Trade

1 April 2005

Software firms need to be more flexible with their overall sales and marketing strategies if they want to maintain or even increase revenues, delegates at the Irish Software Association’s 2003 annual conference were told.

The conference, which took place last month at the O’Reilly Hall in UCD, featured speakers from a number of Irish software firms, including Performix, AEP and Sepro.

The theme of the conference was on generating revenues and increasing sales — a polite way of saying that the industry has lost its edge and needs to improve its sales and marketing skills.

Delegates heard presentations from a number of senior Irish software executives on how they developed successful sales strategies.

Noreen O’Hare, CEO of Sepro, a firm that makes billing software for the wireless sector, said that companies needed to be sure of the kinds of customers and sectors they wanted to target. The company had considered the wired market but was turned off by the e-business hype surrounding it. They also considered focusing on tier one customers but the amount of time needed to reach these customers would have be off-putting to its investors, she said.

‘We decided to focus on tier two and tier three players because the sales cycle would be shorter and we would be able to show a quicker return to our investors,’ she said.

However, she added that a laser-like focus could distract from other opportunities and maybe even lessen the entrepreneurial spirit. ‘Strategy is a guideline and not a straightjacket.’

Cathal McGloin, CEO and founder of Performix Technologies, said then when considering marketing strategies, companies could consider either direct sales or channel partners to reach customers, but even the best marketing plan would not ‘survive the first meeting with the customer or the first scrape with a competitor’, he said.

He said that in attempting to break into foreign markets such as the US, it was important to invest in the right channels and choose partners carefully.

These points were echoed by Pat Donnellan, CEO of security systems company AEP Systems, who admitted to making mistakes in hiring inexperienced sales staff: ‘Don’t trust resumes or CVs or references.’ Instead find a contact who knows the candidate and seek their assessment of the said individual, he said.

One of the company’s most effective routes to market was the acquisition of Baltimore’s hardware division, which secured for it a blue-chip customer base and well-developed sales and reseller channels.

Another religion for AEP today is only ‘to sign with partners who are still in the game’. Other tips he proffered included looking at market data with a sceptical eye; go after an untapped market with no established leader; and do not spend too long on a development phase.

Dr Mike Lynch, CEO of software firm Autonomy said that while Ireland has a software sector that is envied by many other countries, it needs to emulate the American approach to selling. ‘If you examine the great American IT companies, their technology may not be the best but their marketing is superb.’

The conference also featured a surprise appearance from Chris Horn, who stepped in to replace former Iona Technologies CEO Barry Morris, who resigned last week and had been due to deliver the second keynote address.

Horn offered an update on the recent management changes at Iona, but also said that as part of his new strategy, the company would invest $75 million in employing small teams of people, including ex-Iona staff, who could come up with new ideas and develop them for the company.

22/08/2003

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