If you are the CMO or CEO of a technology company, you might be interested in learning that the recession, depression or slowdown in the economy is real, unless you are targeting the federal government, the single largest IT client in the world. No matter the size of your organization, you owe it to your boardroom to map out a strategy to identify the marketing opportunities that exist in government IT and ensure you get a piece of that pie.
What is so alluring about marketing to the government?
1. Common sense: Uncle Sam pays its bills on time. By law, the U.S. Government must pay you by Net 30 or pay a penalty. Imagine that at a time when some large Fortune clients are paying you Net 120 or not-at-all!
2. Uncle Sam is on the hunt for innovative technologies in many areas including but not limited to information security, healthcare records data management, Green IT, enterprise resource planning, telecommunications, and SAS-based solutions that can help achieve the government’s goals and objectives.
3. Getting in is difficult, so once you’re in and got a customer in the form of a government agency, and you perform well, the life time value of your government customer is measured in five year commitments. Imagine this, a client that is willing to make a long-term commitment to you if you keep your promises!
4. Limited competition- it is a national fallacy that only ‘inside the beltway’ companies can succeed in marketing to the government. Everyday, new software companies find ways to create government marketing channels by using smart and strategic channel developments that produce major results and long-term sustained revenues you can rely on.
5. Software is rarely bought as off-the-shelf as it needs to be mass-customized to specific applications; therefore, the government is on a constant pursuit of ways and means to write unique business processes. Most outside the beltway software companies believe the opportunity is to sell ‘seats’ while in reality some large systems integrators are reselling their wares for much higher margins by renaming their boxes in larger solution context which the government loves to buy.
6. The government is not one buyer; it is a force-multiplier of thousands of programs and agencies that have independent purchasing power. For example, GSA, the designated purchasing agent for government agencies accounts for only a portion of the overall purchases of products and services for IT. In reality, the Department of Defense, Department of Homeland Security, the TSA, CIA, and even Department of Interior have their own purchasing offices that compete for procurements everyday and award multi-million dollar contracts to the qualified marketers.
7. The government might have legacy IT systems, but it is on the cutting-edge of almost every technology one can imagine. Recent examples include developing interactive multimedia games for simulation training for soldiers, testing multiple biometric scanning techniques for access control, and continuously testing intrusion detection and soft-fire walls in reinvention labs designated by the government. Moreover, even web 2.0+ and social networking applications are being used at government agencies to promote specific issues. DARPA, a DOD technology reinvention program, is one of them. So bottom line: assuming that the government is an old building that is not being upgraded, is dead wrong and might account for 20-50% of your bottom line.
How do you find out what the government spends money on? Government spending has been focus on fulfilling three mission areas identified in the Presidential Management Agenda (PMA) of current and past presidents:
1. Empower government agencies with better Business Process to help make it more efficient.
2. Become a better customer-service provider to Public Citizen and promote visible accessibility to public records via electronic records management.
3. Create visible accountability by reducing disparate systems and centralizing functions and producing reports that show better service.
There are several great resources I’d recommend as links to Doing Business with Uncle Sam for novices or for advanced marketers that wish to get it info from the ‘source’:
1. WHAT DOES THE PRESIDENT WANT? To Learn what the Government’s Spending Agenda from which OMB develops a budget on behalf of the President, visit http://www.whitehouse.gov/omb/budintegration/pma_index.html
This site publishes what the administration considers to be top priorities. It helps you, as a marketer; identify ‘where the wind blows’.
2. WHAT IS THE GOVERNMENT’S BUDGET? To learn what each government agency is budgeting, post congressional approval, you can visit http://www.whitehouse.gov/omb/budget/fy2009/
This site help marketers identify specifically what the government agency needs in broad terms and how much ‘spend’ is allocated toward your area of service or product.
3. WHAT IS MY COMPETITION DOING/ WHAT IS MY MARKET SHARE? To learn what is the ‘market potential’ of each line of business that government purchases, you should definitely pay a free visit to www.gsadvantage.gov and look for GSA Sales Query section.
4. WHAT DO RFPS LOOK LIKE AND WHAT IS SPECIFICALLY THE GOVERNMENT AWARDS TO CONTRACTORS? For free, you can visit www.fedbizopps.gov and find out what specific awards the government awarded and to whom, which gives you a feel for the specs of what an opportunity might look like. Most importantly, as public information, you can learn who your competitors really are and even who are the contracting officers at a specific government agency you’re interested. Two great recent articles that covered the Government vertical market are BtoB Magazine and DirectMarketing News. You will find these two articles current and useful in understanding the basic premise of this market.
1. BtoB Magazine: 2008 Government Vertical Primer: http://www.btobonline.com/apps/pbcs.dll/article?AID=/20080505/FREE/949739788
2. Direct Marketing News: 2008 Government Vertical Primer:
About the Author: Gal Borenstein is the CEO and Chief Strategist of The Borenstein Group, a leading integrated marketing communications firm dedicated to B2B and B2G marketing. Borenstein has over 20 years of technology marketing and communications experience and has been personally involved in the development and/or dissemination of over 100 B2B and B2G brands, including ADT, Marconi, Learning Tree International, IBM, US Army, Nextel Online, Dominion Telecom, Airbus North America, and others. Based in Washington, DC, he is an expert in communicating within B2G vertical markets such as telecommunications, software, biotech, manufacturing, and defense/homeland security. Gal holds a B.A. in Communications with honors from Temple University and a Master’s degree in Business and Telecommunications Management with honors from George Mason University. He is the founder and chief strategist of Fairfax-Based Borenstein Group and is also a member of Global Fluency, the Chief Marketing Council’s (CMO Council) agency. He may be contacted at www.BorensteinGroup.com or 703-385-8178×205.