Lustratus REPAMA - Strategic Marketing Analysis

Updated High Performance Messaging Report

Just a quick note to say that the updated High Performance Messaging REPAMA Segment Analysis Study has been uploaded to the Lustratus site.  It now contains the reverse-engineered product marketing strategy for TIBCO’s Messaging Appliance P-7500.  Existing customers and Lustratus research subscription holders will already have been contacted with details of free upgrades. 

Following on from the blog entry I made when the first version of the report was released I thought I’d show the updated value proposition below.  As I mentioned in a previous blog entry TIBCO’s primary competitive focus is very unusual – it is TIBCO Rendezvous - one of its own products.  The different approach to the market doesn't stop there as you’ll see from the report extract below.  TIBCO also plough its own furrow by taking a different proposition to the market when compared with most of their competitors.  This one based around green IT and data centre costs (in addition to the obligatory low latency = competitive advantage proposition).

For more information on the REPAMA methodology visit here.

Danny Goodall.

An ESB is an ESB is an ESB - n'est pas?

As the saying goes, if it looks like a fish, smells like a fish and tastes like a fish then the chances are that it is a fish.  Likewise by any measure the products in the recent REPAMA study into the ESB market segment certainly appear to be ESBs but why then is none of the vendors content with describing their products simply as an "ESB".

As the REPAMA Marketing Element Distribution (MED) chart below shows, the ESB vendors in the study (Microsoft ESB Guidance 1.0, Oracle Service Bus, Progress Sonic ESB, TIBCO ActiveMatrix Service Bus) used the following adjectives, qualifiers, modifiers and euphemisms to describe the offer category of their "ESB".

• A loosely-coupled messaging environment
• A comprehensive Enterprise Service Bus offering
• Architectural guidance, patterns and practices
• Messaging-based Enterprise Service Bus
• Enterprise-class SOA Enterprise Service Bus
• High performance, scalable SOA integration backbone
• Lightweight Enterprise Service Bus
• Mediation Layer
• Enterprise Service Bus

Words are wonderful things and marketing organisations as experienced as these wouldn't use words without a reason.  As mentioned previously in this blog entry, when a category becomes as ultra-competitive as the ESB space, vendors will attempt to segment and re-segment the market on their terms and the product category is the first place they start.  

As a result, there is a raft of valuable competitive intelligence in this simple list of words above (visualised by wordle.net).  Why is each vendor modifying the product category in this way?  Answer that question and you'll gain an insight into the particular position within the ESB segment that each vendor is trying to own.

Danny Goodall.

Enterprise Service Bus (ESB) REPAMA findings published

Just a A quick note to say that the REPAMA Segment Analysis Study into the Enterprise Service Bus (ESB) has been published on the Lustratus.com site.  The ESB is a segment that Lustratus knows well as we've carried out strategic marketing work for most of the key protagonists at some point.  That said, there were a number of surprises - chief amongst these was some of the competitive differentiation strategies that we saw as well as the markedly different approach taken by Microsoft.

The study reverse-engineered the go-to-market strategies of the following vendors and products:

• Microsoft ESB Guidance 1.0
• Oracle Service Bus
• Progress Sonic ESB
• TIBCO ActiveMatrix Service Bus

In reaction to client feedback, we've published two sets of reports with this particular study   I've created a summary report that contains a management summary of the state of vendor marketing strategies in the ESB market segment as well as the results of the full-blown REPAMA Segment Analysis Study. 

Danny Goodall.

TIBCO eats itself

Cannibalization.  You don't get to see that very often unless something strange has happened.  No, I'm not talking about the act of eating the flesh of the same species.  Instead I'm referring to where a vendor eats into its own sales by promoting one of its products ahead of another in the same market.  It is highly unusual for a vendor to be willing to sacrifice sales of one product line to increase another.  In my experience these things usually happen through some form of mistake or oversight in planning.  However, that doesn't appear to be the case with TIBCO's recent announcement of the TIBCO Messaging Appliance. 

As we suggested in our report The High-Performance Messaging Arms Race, we thought that the introduction of hardware into this market would have an impact.  And that certainly appears to have been the case.  In light of TIBCO's new product introduction I'm in the process of updating the REPAMA SAS on High Performance Messaging (where we looked at the marketing strategies of 29West's LBM, IBM's LLM and Solace Systems' Content Router).  As regular readers will recall, one of the key elements of the reverse-engineered positioning statement that we use with the REPAMA methodology, is the UNLIKE section.

UNLIKE (primary competitor or alternative)

This element of the positioning statement is usually used to aim the full power of the vendor's USP at a specific competitor.  However, in my early findings for the TIBCO, the UNLIKE element for TIBCO's Messaging Appliance appears to be:

UNLIKE TIBCO Rendezvous

That's right.  TIBCO sees the Messaging Appliance's primary alternative as TIBCO Rendezvous.  Which begs the questions; why aim the full power of this new product at an incredibly successful existing product?  Why is TIBCO happy to cannibalize sales of Rendezvous for the benefit of the Messaging Appliance?  It appears that the answer could be three-fold. 

1. TIBCO no longer believes in the proposition for Rendezvous (in software). 
2. Extreme competition exists from other software vendors that are able to simply replace Rendezvous and perform far better.  
3. As referenced here in SDTimes, TIBCO sees the advantages of blurring the CapEx/OpEx boundaries through the love that keeps on giving - the annual lease. 

So whilst self-cannibalization of sales is usually the by-product of poor planning, here it appears to be TIBCO's only choice.  Either way it's a risky strategy and represents a big opportunity for software vendors that are able to do what Rendezvous does (IBM, 29West, etc.) and is also a pat on the back for Solace Systems - who had more than a little hand in the production of TIBCO's Messaging Appliance.

Danny Goodall

P.S. Apologies for the image at the top but I usually like to select an image that matches the blog subject.  But having image Google'd "cannibalism", I just couldn't use any of the images!

An "average" marketing strategy

Mean.  It's a great word isn't it.  But what does mean, mean?  If you see what I mean.  It's either hateful, the intended meaning of something or, as I want to use it here - an average.  In this case it's the "average" marketing strategy for a specific marketing segment.  What would be the value of knowing the "average" marketing strategy for any number of strategic marketing elements for the segment in which you compete?

i.e. on average for your market segment who is the ideal target customer organisation? On average what job roles do your competitors target? On average which vertical markets are favoured? On average who does your competition see as their primary competition? etc.

(click the image for a larger version)

(click the image for a larger version)

(click the image for a larger version)

The above Marketing Element Distribution(TM) charts are taken from a recent Lustratus REPAMA(TM) Segment Analysis Study into High Performance Messaging.  The study compared the marketing strategy of IBM's WebSphere MQ Low Latency Messaging (LLM), 29West's Latency Busters Messaging (LBM) and Solace Systems' Content Router.  Whilst the study contains full details for each of these vendor's strategies, the calculated "Market Mean" reflects the mean value of each of the marketing elements across those 3 vendors.

Lustratus produces this intelligence as part of the Lustratus REPAMA Segment Analysis Study and we obviously plot the positions of each of the vendors in addition to the mean, but this is relatively simple exercise to conduct for yourselves.  The question is what do you do once you know the mean?  Do you look to be outside of the mean?  The religion of "differentiate or die" suggests you probably do.  But the idea that what "most" of your competitors are doing must be right, suggests that you might want to simply track them.  Look at the Vertical Market Segmentation chart above and ask yourself whether you want to aim outside of Financial Services?  Well it might be an uncontested space, but at the same time their might be a lot of tumbleweed.

The answer of course is that whilst you can compute an "average" marketing strategy, the right strategy for your organisations depends on many factors.  Aiming at the average vertical market and at the average ideal customer might be valid strategies because it suggests that is where the rest of the segment feels there is opportunity.  But if you attack these prospects with "average" messaging and "average" differentiation it will be death by a thousand ho-hum cuts.

Either way, knowing what your competitors are doing is a good place to start.

Dan.

Running the REPAMA rule over mainframe SOA

I've just finished the REPAMA Segment Analysis Study and Marketing Efficacy Assessment on High Performance Middleware.  It's just going through our buddy checking process at the moment so now I can get on with the next project.  We're about to start looking at vendors of integration and SOA solutions on the mainframe with the REPAMA methodology. 

It's really interesting (well if you're a marketing analyst) when you start a new project.  You have to leave a lot of your preconceptions behind.  If you're reverse engineering the marketing strategy from a vendor's go to market material, it's quite wrong to form firm opinions about the results before you even start the analysis. 

I mean, if I were to ask you who you think would be the typical target organisation and audience for a vendor of mainframe integration and SOA solutions, you might think that they'd be in the picture above. 

That said, from the work I've done so far this image couldn't be further from the truth.  The mainframe; the only truly secure and reliable platform for some organisations, or the incumbent legacy platform that it isn't cost effective to move away from for other organisations.  Either way it's a bottleneck for truly effective SOA projects. 

With so much data of record and critical processes residing on the world's mainframes, an organisation's ability to bring the mainframe into broader integration and SOA projects in as quick, simple and cost effective way will determine the success or otherwise of many broader, non-mainframe SOA projects. 

The mainframe is now at the hub of many SOA projects as is the software that makes it possible to securely integrate the mainframe world into "mainstream" enterprise computing.

Anyway the vendors on the long list so far include:  

IBM (CICs, IMS, WebSphere, RD for System Z)
DataDirect’s Shadow (Progress Software)
GT Software’s Ivory
SOA Software’s SOLA
Hostbridge
Software AG
Microfocus
Rocket Software

Some of these might not make the cut as we're aiming to look at about 4 of them in total.  I'll keep you posted on the early findings over the next couple of weeks.

Dan.

"We all target the same prospects"

I hear this a lot in the high-tech marketing world.  Organisations tell me that when they are prospecting they and their competitors target the same organisations and the same people. 

I want to highlight how assumptions like this can be very dangerous in competitive marketing.  It's lazy to assume that your closest competitors are saying the same thing to the same people as you are targeting.  

Sure there are major similarities in most highly competitive markets but when Lustratus studies the protagonists and their relative offerings in detail we always find significant clear blue water between them.

We developed the REPAMA methodology to bring a little clearer insight into competitive marketing.  We've recently completed a REPAMA Segment Analysis Study (SAS) on a subset of the High Performance Messaging market.  There are some really interesting things going on at the moment in that market.  Some really clever software and network architecture techniques are being used to remove the delay between one application sending a message and another application receiving it.  In addition dedicated FPGA hardware is now being used to replace software servers.  The primary beneficiary of this capability (minimizing the delay) is the financial markets where saving time exchanging information can literally translate to millions of dollars lost or gained.

We were asked to look at IBM's WebSphere MQ Low Latency Messaging (LLM), Solace Systems' Content Router and 29West's Latency Busters Messaging (LBM).  Prior to starting the analysis we were led to believe that "we all target the same prospects".  Whilst it is true that there is massive similarities between the strategies of the respective competitors, there is also significant, subtle as well as not so subtle difference. 

The image above (click for a larger image) shows the ideal target customer as inferred by the language of the vendor in their outbound marketing activities.  This puts a lie to the argument that "we all target the same prospects".  In reality, there is a great deal of similarity in the industry of the target prospects (with the exception of the channel business of Solace Systems) but the specific targets differ significantly from company to company.  Relying on a lazy assumption would almost certainly result in ceding market opportunities to the competition.

OK so I'll close out with two very interesting charts (well they're interesting if you're a marketing analyst). 

The image above (click for more detail) shows the features and benefits that they various vendors ascribe to their products and services.  As you'll see, there is a high degree of correlation between them.  In fact you would assume that when they are in front of a prospect, each of these individual companies would be saying much the same thing and that their arguments would be indistinguishable from each other.

That may well be true whilst they are talking about the technology and its features.  There is certainly a high degree of correlation.  However, once the vendor interprets these features into benefits that the business would enjoy, the picture shows a different story. 

Here, in the diagram above (click for more detail), we can see significant differences in the value ascribed to the respective products by their respective owners. 

What does this tell us?

Well if the vendors sell on technical features to technical people then there are similarities that will likely only be resolved by comparing the products in detail and perhaps looking at the specific performance through benchmarks or evaluations.  However if the vendor sells based on the value of the technology to the business in business terms, then we can see that the vendors are very different in their approach.  As part of the study we also infer the place where the vendor looks to start the sales process as well as their likely commitment to value-based selling.

So "we all target the same prospects" might be true in once sense but it takes a detailed analysis of the picture to really infer how organisations actually take their products to market. 

Lesson?  Never assume that you know what your competitors are doing just because you know what you do.  They will be different.  Better?  Worse?  Well that depends. But knowing that there is a difference is the first step in building a "better" story and selling more. 

And remember "different" makes it easier for prospects to make decisions.

Dan.