Advisory Insider: These Assumptions Can Derail Your Journey to Next-Phase AR

Disconnects, misunderstandings or blind spots into how analyst and advisory organizations work can block the path to the future state of AR

If you don't know where you are going, any road will get you there - Lewis Carroll

You can’t really know where you are going until you know where you have been - Maya Angelou

I will add one more to the list ….

If you don’t know where you are, no map is going to help - Bill Gannon

The end of a calendar year is typically a time of introspection for businesses and serves as the trigger to launch plans for what the next great thing should be.  Budgeting and business planning starts.  New visions and strategies are germinating.  New messaging and branding are developed.  New markets are defined.  Roll-outs are planned.  Go-to-market programs are initiated. 

The ideation process is as true for the AR role as any other.  As such, there is a lot of attention right now on what the next phase, form and focus for AR could be.  

• How can AR elevate its relevance and strategic importance to the business? 

• How should AR evolve to meet the demands of rapidly changing vendor organizations? 

• How can AR contribute more value in global markets rife with turmoil, upheaval and economic uncertainty?

Myriad articles, blogs and twitter feeds have popped up recently discussing AR’s transition to Influencer relations, category creation, market relations and stakeholder relations. All can be valid and worthy future destinations for AR professionals and programs. There is one overriding problem though:

Before you embark on a journey of change, you need to know where you are starting from.

And here is some tough love for AR – many of the presumptions you have about the advisory organizations with whom you engage are incorrect.  Therefore, your starting point – the fundamental suppositions that you have of your role, business and priorities -- may be different from what you think because your understanding of how advisory firms operate may be flawed.  This means your path to the next phase of AR will be more haphazard and/or treacherous.

Gaining a clearer understanding and more accurate perspective of how analysts and advisory firms work is critical. In 35+ years in the advisory services market I’ve witnessed several AR/Vendor assumptions that don’t map to the reality of how advisory firms work.  Here is an insider’s view on a few of the most common misconceptions that AR teams absolutely can address.

1) The volume of research published is an analog for the influence analysts and advisory firms wield. 

Share of voice, when measured by how much analysts publish, widely misses the mark as a metric of analyst influence, impact and value.  Analysts write, blog, consult, present, talk and tweet.  Published research rarely exceeds 25% of the total content an analyst generates in a year and never fully accounts for the hundreds of hours and mountains of research they develop in preparation to engaging 1 on 1 with buyers during their decision cycles. 

It is true that the major players account for less than 20% of total industry published research, but that fact isn’t really relevant.  The right measure is, of the $4T IT/Services market, how much influence do they have?  A smaller firm producing less written research, but with a tighter focus, can have as much or more impact in its target market than one of the big-3.  Presuming you can identify and prioritize advisory firms based on a single metric, like written research, is faulty and misses critical context.  It would be like saying that Tom Brady, Patrick Mahomes, Josh Allen and Aaron Rodgers are just 4 quarterbacks among more than 20,000 that play American Football in the US and therefore, sports media should allocate TV and print coverage appropriately.  And the same error could be made on other extreme by saying Brady, Mahomes, Allen and Rodgers should get all the attention – when there may be hot new talent rising elsewhere.   You need your own metrics and measures to determine where you place your emphasis and investments.

So, what should you do?    Ask for greater transparency from your analyst targets.  Learn how they spend their typical day, week and month?  It is not just about their research calendars but also how much time are they building content versus working directly with buyers?  How do they engage buyers (1-1, webinars, consulting projects, blog, video, twitter, industry events).  Ask your clients about which analysts they most frequently work with and trust.  Work with your business leaders so they fully understand the scale, scope and channels analysts use to influence your buyers. Multi-format approaches from analysts will become more and more prevalent as analysts write shorter research notes, produce more packaged video content, engage in more 1 to 1 consultative sessions, tweet and blog more.  Analysts are moving away from reports that provide old-school thud factor.  Therefore, research content becomes more bite-sized, dynamic, customizable and serves as a way to get buyers to engage in a more 1 to 1 fashion where true analyst value can shine.   Build your own scorecard where published research is just one metric. 

2)  Analysts need your briefings/insights, or they could not produce their research.

Deciding to work with an analyst firm is a major time commitment.  Even the largest of large vendors can’t do it all.  They can’t participate in every research effort; they can’t work with every analyst; they can’t support every briefing their firms request.  The workload on AR is compounded as requests pour in from advisory firms to complete mock RFPs, complete surveys, identify client references, conduct briefings, etc.  AR’s frustration about what can seem like capricious and unreasonable deadlines set by analysts is understandable. They can’t do it all.

The knee-jerk reaction from AR may be to push back – which is reasonable.  However, presuming that your participation is a critical lynch pin in an analyst’s ability to produce cogent and insightful market analyses is incorrect.   Participation is your choice, but completing their research is theirs.  And they will complete their research one way or another.

There are two streams here.  The first is briefings.  In the 5 advisory firms where I’ve worked, briefing availability has never been influenced by vendor spend levels.  Briefings are a completely voluntary activity for analysts.  They can choose to engage vendors via briefings or not based on their availability, need or desire.  You can choose to proactively drive briefing requests or to respond to analyst requests for a briefing – or not – as well.  You may make it slightly more difficult for the analyst if you withdraw from their research efforts, but it won’t shut down these efforts.  AR can make analysts’ jobs easier, and you can give them a far richer perspective of your strengths in the market, but you won’t shut them down by withholding cooperation.

The second stream is the seemingly never-ending array of mock RFPs, surveys, capability templates, references and financial disclosures that analysts ask vendors to complete.  Again, the vendor can choose to cooperate or not.  Regardless, if the analyst intends to include you in a research analysis, you will be included whether you provide the information or not.  Analysts can rally significant internal resources and teams to capture RFP and vendor data from secondary sources in cases where vendors chose not to participate or could not meet the deadlines imposed.  Analysts regularly do their own customer/market research, tap other (non-AR contacts) in the vendor, talk to vendor’s customers and extrapolate data from other industry sources, etc.   They’d prefer to get data, insights and inputs straight from the vendor, but in the end, they use multiple vendor-independent sources anyway to support and validate their research efforts.     

So, what should you do?  When it is a priority for your firm, use briefings and research participation templates (RFI, surveys, etc.) as a way to have your voice heard.  Don’t assume that the deadlines you are given are immovable, however.  If you chose to participate and the task of response is too onerous in the timeframe given, push back.  My experience is that analysts don’t purposefully impose deadlines that make vendors apoplectic.  They regularly trade off longer deadlines for deeper, more accurate and complete information.  Be clear about what you can provide and when and what you CANNOT provide (i.e., sensitive financial breakdowns).   And when you decide to participate in a research effort, think carefully about what specific strengths and capabilities you want the analyst to remember and what you want them to repeat to buyers via their research and inquiry.  The benefit of participating is that you get to tell your story in your words.

3) Preparing your executives for a briefing is just like preparing them for other market-facing presentations.

An analyst briefing is a unique communication platform and interaction.  The base content for a briefing may be similar to that used in prospect presentations or industry keynotes.  However, how the data/analysis is consumed and then applied by analysts is very different than how a prospect, industry editor, or trade-show audience engages.  I’ve seen vendors tack analyst briefings to the end of a road-show – and seen it fail spectacularly. 

Look at the briefing through the prism of “What do you want the analyst to remember and then to repeat to buyers?” Succinctly, what message do you want them to share via research, or more importantly advisory sessions with buyers?  This is true regardless of whether you prompted the briefing or if the analyst requested it.  An individual analyst may advise and consult with 500 or more buyers via 1 on 1 sessions a year influencing their budgets, spend and vendor selection in ways far more targeted and personal than how tradeshow, user conference or even vendor prospect meetings do. 

Sudeshna Mukherjee, AR lead at Mastek, published some great thoughts on this in LinkedIn (link below)

So, what should you do?  As you work with your executives in preparing for a briefing, read the latest published report(s) from the analyst.  Know their point of view and where it aligns or differs from your perspective.  Understand that the briefing is primarily a listening session for the analyst.  Briefings are not a two-way discussion.   Take a look at the LinkedIn posting from Sudesha regarding briefing preparation.  https://www.linkedin.com/posts/mukherjeesudeshna_analystrelations-publicrelations-ar-activity-6987380045929435136-I7Rg?utm_source=share&utm_medium=member_desktop

4)  More spend moves the dot in an MQ, Wave or other analyst assessment. 

This is very rarely an AR point of view but is one where AR may not effectively derail it from agitated senior executives.  I once had an executive tell me that, “maybe I can’t change your perspective on ability to deliver, but I sure as hell can buy my way into a better vision rating.”  There are perpetual whispers – if not outright accusations – that pay for play is happening.

If an advisory salesperson could sell the dot – either the inclusion of a dot in the chart or the location of that dot in a higher and/or more rightward position – you’d see a lot of young advisory salespeople retired on beaches in exotic locations.  Nothing triggers analyst annoyance or career-ending attention from the ombuds/compliance/ethics team faster than even a hint of a salesperson trying to influence an analyst’s independence.  There is nothing more valued and protected as part of an advisory firm’s brand than its independence.    

Ironically, the executives who I’ve seen claim that pay-for-play exists have been those who spend a lot, and still don’t get the dot positioned where they want, which would seem to contradict their premise.  So, which is it?  That the dot can be purchased, but just NOT with their dollars?  Or competitors can buy a dot even if they spend less?  The dot, wave, etc. is not for sale.

So, what should you do?  Help your executives understand advisory business models and how analysts work.  Help them understand how advisory firms gain Wall Street valuations and why they earn the multiples they do – and why this acts as a major check against selling positive coverage.  Analysts may not always get it right (in an executive’s mind), but they are not for sale. Provide upward coaching and set executive expectations.   For advisory firms, no vendor contract is worth the risk of even the perception of crossing the line of independence. 

5)      You are THE critical customer of the analyst or advisory firm.  

The most vital analysts with which you want a relationship are those with the closest associations with buyers.  If the analyst has the ear of the CIO and the business teams that approve spend on your solutions, you need them in your feedback loop.   These analysts will yield that most tangible results for your AR programs.  These analysts need to be your early warning system and part of your advance scouting team. 

In a market where competitive, geopolitical and economic change is accelerating, you need as much time as possible to prepare for tectonic shifts.  You need a clear a view into future opportunities.  Analysts who are embedded with buyers are your best resource for these insights.  Of course, while you gain the most value from these buyer-focused analysts it often means they will have less time for you – and thus the conflict builds because you can’t access the analyst the moment you need to.

A mindset where a vendor thinks, “I spent a lot with your firm so I deserve to be your top priority,” and where vendors get annoyed when the analyst is unavailable or where the vendor believes their firm is not the gravitational center of the analyst’s thinking misses the point.  You are A customer of the analyst, not THE customer.  If an analyst places your relationship above the relationships they have with buyers, then you probably have the wrong analyst.  The best analysts focus on business outcomes of buyers as their priority and then on the technologies that enable those outcomes.

Clearly there are analysts who have the right skills, experience and demeanor to provide advice and counsel to your executive teams regarding market strategy, messaging, positioning, and other go-to-market initiatives.  But those that are your most valuable targets acquire those insights by working with buyers and understanding the voice of the customer.  You want your analysts to put you second on their priority list (behind buyers) and then to apply their customer insights specifically in the context of your go-to-market strategies and challenges.

So, what should you do?  AR teams need to better understand how analyst roles, responsibilities and workflows have changed and adapt their interaction plans accordingly.  What analysts produce (written research, blogs, video, conference content, 1 to 1 preparation materials, etc.) and how their areas of responsibility are bifurcated across “write/produce research” versus “speak and engage buyers” will drive new AR engagement strategies.  Understand and empathize with the demands on the analyst for content creation, client advisory, and what they need to do to grow their expertise, personal brand and market visibility. AR teams that adapt to the how analysts work will dramatically outperform peer groups.

The AR role is on the move.  But so is the analyst role.  Both roles will be redefined, reshaped and expand into new areas at a time when markets are operating in a maelstrom of geo-political change, conflict and economic turmoil.  The current position of AR in the market – vis-à-vis how it engages analysts and advisory firms – may have faulty presumptions that will act as a drag on its ability to achieve a new future state. 

So often today, AR is in a winless situation ... (1) AR gets faulted when things go wrong – but rarely gets credit when business successes are achieved as a result of advisory firm engagement; (2) Vendor leadership doesn’t often prioritize AR in the same way they prioritize sales enablement, marketing communications, or other revenue generating initiatives and fights for funding year-after-year;  (3) Executive leaders believe favorable analyst coverage can be purchased and get more critical of AR and advisory investments when analyst coverage doesn’t jibe with executive expectations, (4) AR effectiveness/value is not always tangible or directly measurable so defending investment levels is a constant challenge.  

A deeper understanding of the business of analyst firms will show the path toward the next iteration of AR much more clearly.

This is the fourth blog entry on Analyst Relations from the perspective of an advisory firm insider.  Below are quick links and overviews of the other blogs I’ve written:

1. The first blog covered the impact of recessionary pressures on analyst firms, how they react and what it means for IT vendors.   Substack Link: (Your AR/Influencer Strategy Is Not Ready for 2023 (substack.com)
   

2. The second looked at AR mindsets and revealed a gap in thinking and a blind spot for better aligning with analysts and influencers – namely strategic selling skills.  Substack Link: (For AR Leaders, Strategic Selling is a Blind Spot (substack.com)
   

3. The third examined how AR can drive new areas of value, interaction and impact (without necessarily spending more money).  Substack Link: 9 Reasons AR Should Think About Their Relationships with Advisory Sales Teams (substack.com)

Another helpful analysis of how AR can drive more value was published by CCGroup  Ten ways that analyst relations can build trust and improve analyst success (ccgrouppr.com)

If you like what you see, or disagree with these points of view -- comment or DM me in LinkedIn.