How do tech marketers pinpoint true decision makers in SMB? By understanding what defines an SMB and who’s really calling the shots.
For tech marketers, it’s an all too familiar story: You’re faced with a staggering number of companies in the SMB space and the daunting task of reaching every last one of them. As a result, your company often goes to great lengths to ensure they’re “targeting SMBs.” There appears to be a common misstep in how companies have been carrying out their marketing approach: They assume that reaching out to the CIOs of SMBs will do the trick. Sure, there are a few exceptions, but when all is said and done, there are just not enough CIOs of SMBs to warrant spending time and resources on a lengthy marketing campaign.
What actually is an SMB? And who manages their $800B annual IT wallet? Since no two companies targeting SMBs define them in the same way, let’s clear the air with a simple definition: SMBs are companies having fewer than 1,000 employees.
This leads us to a few global stats:These 7M are the IT decision makers who are purchasing tech for SMB-size organizations. This means that IT decision makers manage purchasing for over 197M employees inside of 18M companies worldwide. That’s an estimated $800 billion yearly spent on IT and some serious buying clout.
Where to begin? Wrapping your brain around the scale of the SMB market is a great starting place for tackling your new marketing game plan. So first things first: let’s level set on what we mean by organization size.
The Home Office Market: (1 to 10 employees)
Starring: Your Friendly Neighbor, Fred
At the lower end of the SMB market, we typically find 1 to 10 employees often referred to as small office/home office (aka SOHO). These folks tend to purchase products from mass retail outlets (Best Buy/Wal-Mart)
or online retail stores (Dell.com/Amazon.com) and then often seek out help from IT-savvy friends or family members to set up and sometimes maintain their computers/networks.
The ‘S’ of the SMB Market: (10 to 250 employees)
Starring: The MSP & the IT Generalist
Picture your small neighborhood insurance office or vet clinic. These are the typical small businesses that make up a large part of the workforce around the globe, and where actual IT budgets (albeit small ones!) start to take shape. Because they lack the buying power of large companies, they’re extra careful about the dollars they spend. Don’t look for a large IT department here – these organizations usually only employ between 1 to 5 full-time IT pros. Not surprisingly, MSPs and VARs play a large role in this segment by complementing technology infrastructures or even running all of IT for them. That also goes for purchasing. As a large number of products and services are acquired through VARs/channel vendors, they trust these partners and have cultivated very strong relationships with them.
The ‘M’ of the SMB Market: (250 to 500 employees)
Starring: The IT Guru
As smaller companies evolve into bigger players in their industry, they find themselves working harder to compete in the medium business space. With an average, rather sizable IT budget of over $1M annually, these SMBs have “staffed up” with an IT department of 3 to 10 employees and sometimes even a VP of IT. They purchase large amounts, if not all, of their products through VARs and DMRs.
The Large SMB Market: (501 to 1,000 employees)
Starring: The VP of IT
The SMB “bulls-eye”: The fewest number of companies boasting the largest IT budgets with IT organizations ranging from 5 to 20 people. A VP of IT is not uncommon here but, as is the case in the medium space, these VPs are known for getting their hands dirty alongside their staff as they help put out IT fi res within their organization. SMBs in this space are using VARs and DMRs almost exclusively and this is where we start to see solution-driven IT deployments. These IT departments have larger-scale needs that may require on-site contractors and special employees who set up/deploy systems and move on to another large company opportunity.
The Enterprise Market: (Over 1,000 employees)
Starring: The CIO
This is where the big dogs play, and they’re easy to track down and network with. Sadly, this is where most IT vendors focus their efforts, leaving the IT pros of true SMBs largely ignored. No love for the little guy! Yeah, the CIO is here (as is the CISO, CTO, etc.), but then these are not SMBs by any measure. Not surprisingly, tech vendors work directly with these heavy hitters to purchase products, negotiate price, service levels, etc.
What’s a tech marketer to do now?
Even as IT organizations grow (in staff and responsibilities) the decision makers are “downstream” where you’d like your brand to be. Yes, the CEO, COO and sometimes the CIO are the ones who write the check, but don’t forget: While the regular guys and gals in the IT department may not have the power to say “yes,” they most certainly do have the power to say “no” and are usually the ones who shape the purchase discussion. Here’s what not to do: Focus on the CIO as the only decision maker and watch your sales plummet.
Just pay attention to the large number of voices and influencers in these IT departments when marketing and selling tech products, services and solutions. Voila: tech marketing at its finest! Through IT communities, tech conferences, and informative newsletters you can connect with these key players, speak to the C-Level suite, and make your marketing and sales efforts get more done.
