The year 2021 was mixed for businesses in terms of digital transformation. While many companies forged ahead with their digital transformation plans, some of them suffered various setbacks driven by pandemic, virtual, and supply chain issues. However, businesses continue to forge ahead with their digital transformation initiatives and tech investments. While the tech investments are expected to increaseOpens a new window this year, there is an increased proliferation of tech-savvy business units taking on more technology-related responsibilities.
In such a situation, IDG’s recent study tried to find the role and influence of technology leaders in purchase decisions. The study also helps tech marketers identify what drives the purchase decisions and what information sources decision-makers look at.
A major finding of the IDG’s 2022 Role & Influence of the Technology Decision-Maker studyOpens a new window was that IT leaders are in control of critical decisions regarding corporate standards and governance. The study also showed that decision-makers continue to be open to new vendors. Here are the findings in detail.
IT Leaders Plan To Increase Tech Investments
The study found that 51% of IT leaders plan to increase their IT budgets this year compared to last year. The spending plan is most aggressive in the high tech vertical, followed closely by the telecom and retail/wholesale/distribution verticals. In contrast, only 29% of educational institutions expect to spend more this year. Further, about 52% of respondents plan to increase their investments in software, while 43% plan to invest in hardware and 50% in services.
A significantly higher percentage of financial services and manufacturing companies are increasing their investments in hardware when it comes to industries. Educational institutions plan to increase their software spending, albeit less than other verticals. About 70% of retailers plan to increase spending on services. This could indicate that retailers are spending on cloud-based services while financial services and manufacturers may spend on smart devices and artificial intelligence (AI) machines.
See more: What Should Be the CMO Role In Tech Buying Decisions?
Internal and External Factors Affect Decision-making
So, what are the factors affecting tech strategy and purchase decisions? About one-third of respondents said they intend to maintain the status quo. One-third said they would respond to internal events, and about 29% said they would respond to external influences. Internal events include process changes, re-organizations, and internal skills shortages. External factors include customer requests, market changes, and competitive threats.
IT Leaders Are Open to New Vendors
More IT leaders have been showing openness to buying solutions from new vendors over the last three years. In fact, 45% of respondents said they sought or will seek a new vendor. Some of the reasons IT leaders are open to new vendors are:
- Current products/services do not meet the business needs anymore
- The cost/level of investment needed by the current vendor has increased
- Customer service has become poor
The percentage of leaders who cited these reasons has gone up since 2019.
The message to vendors is clear: protect your existing customer base, especially in high-growth industries. Also, IT decision-makers were more likely to seek a new vendor in data/analytics, non-SaaS enterprise software, IoT devices, and mobile apps. This also shows that there is lesser loyalty in volatile markets.
Marketers Should Know the Decision-Makers
The study found that the average length of the tech purchase process had increased since 2019. One reason for this was the growth in the buying committee. The average size of the buying committee had risen to 20 in 2021 compared to 16 in 2017. The largest committees were dedicated to decisions around IoT (25 people), cloud (24), and enterprise non-SaaS (23). The study also found that the active participation of “citizen IT†or non-IT decision-makers has also increased, given that more organizations are supporting citizen IT development.
Having said that, IT leaders are moving with caution with the involvement of citizen IT as they are concerned about security/governance, the time needed to educate business users, and integration with existing systems and applications. Nevertheless, non-IT leaders are actively getting involved in decision-making.
IT Leaders Consume Content From Trusted Sources
So, what information sources are IT leaders referring to before making a decision? More than three-quarters (76%) of IT leaders consume content from known and trusted brands as they are confident about the time being well-spent. Many of them also spend time on technology content sites that cover news and how-to information. This is followed by white papers and, to a lesser extent, information from tech vendors, webcasts, and peers outside the company. At the same time, it was found that 15 different information sources, including newsletters and online communities, influenced at least one-quarter of decision-makers.
Top content sources IT decision-makers consume
Source: 2022 Role & Influence of the Technology Decision-Maker studyOpens a new window
Different sources also had different levels of importance depending on the decision maker’s stage in the buying process. In the early stage processes, technology content sites had the highest priority. When it came to selling their decisions internally, technology vendor websites came on top. Technology vendor websites are also influential in the authorization and the purchase approval stage, followed by content sites and peers inside the company.
One thing that emerged from the study was that technology vendors had gained influence this year, as they were among the top sources of information in the final three stages of the purchase.
See more: 5 Factors to Consider Before Purchasing An Application Performance Monitoring Platform
Visual and Audio Media Grow in Importance
The average number of content IT leaders downloaded also went up to six compared to five in 2017. It was also found that product reviews, case studies, third-party market research, and videos related to third-party vendors also significantly influenced decision-making. Events were another influential source of information. Visual and audio media are also growing in prominence. For example, webcasts are taking over some of the functions of events. Podcasts also went mainstream, and online video is another primary information source, watched by a whopping 96% of buyers. The most popular type of video content was in-depth product reviews, followed by analyst/research reports and how-to content. In contrast, leaders listened to podcasts primarily to learn about new technology.
Vendor Content Grows in Importance
A few things emerge from this study. Firstly, while IT heads are still the key decision-makers when it comes to buying new tech for the company, the participation of citizen IT professionals has grown. This means marketers will have to tailor content for the appropriate target audience instead of a single decision-maker. Secondly, decision-makers have continued to visit their trusted sources to make decisions. With vendor websites growing in prominence, they will have to become a trusted source of information.
Further, with fast-changing markets, decision-makers have started moving away from technology and vendors who no longer serve their purpose or provide the right experience. They are open to exploring new vendors. As such, vendors must continue to innovate and deliver excellent customer experience. The preference for the type of content, too, is evolving, with videos, podcasts, webcasts, and events gaining prominence.
Ultimately, vendors able to provide the right solutions to their customers, build trust, provide excellent experiences, and high-quality and informative content in various formats at the right stage will continue to reap massive rewards.
What steps have you taken to attract more tech decision-makers? Share with us on FacebookOpens a new window , TwitterOpens a new window , and LinkedInOpens a new window .