On Monday the 31st, Zack Urlocker a blogger/columnist for InfoWorld had a nicely provocative headline Other Underreported Stories: Analyst Integrity? Of course, the rumors – urban legends – about pay-for-position or pay-to-play have been around forever. In general, these rumors are just that. The easiest way to dismiss them? Common sense.
To his credit Zack discounts these rumors using his long personal experience. However, I look at it as a matter of common sense. Firms like AMR, Forrester and Gartner (as well as deceased firms like Giga and META) get the majority of their revenues from the end user (aka IT buyer or corporate IT manager) community. For Gartner, it is at least 75% of its total. So why would an analyst firm put at risk this much revenue to get a few incremental dollars out of some poor vendor by selling their integrity? Well, common sense tells me that while there might be a desperate firm employee or so over the years that might try this gambit to make their sales quotas, the firms’ executives and analysts would never be so stupid.
The whole pay-to-play rumor is so persistent that it became one of the myths that I wrote about in Analyst myths revisited – “Analysts know everything” still #1 for IT managers and vendors. I have talked to many, many vendor executives in the last nine years that believe this but never have had any proof. It is also not a matter of not wanting to share the details for fear of analyst retaliation, because the circumstances were such that the executives were giving me lots of other more damning information. No, it was because none of them had experienced it directly. It was always “well, everybody knows” or “I know someone who…” These are classic urban legends characteristics. When I explained the common sense reason why analyst firms would not do this, they almost always calmed down and looked at the situation in a new light.
The real issue is one of perception caused by analysts that are not sensitive to vendors’ feelings. Our SageNote™ “What You Heard versus What They Said” addresses how analysts accidently give the impression that a timely subscription contract or analyst consulting day could solve the vendor’s position problem in research. I experienced this at a vendor I worked at (and nearly two years after writing that SageNote). I had arranged a telephone briefing between a marketing director and a senior Gartner analyst. Several times during the briefing the analyst said “if you would only work with me earlier I could help” or something similar. After the briefing, I literally ran to the marketing director’s cubicle because I suspected she misinterpreted what the analyst said. As I skidded into her cube I could clearly see she was fuming. Yes, she thought that the analyst was trying to extort money out of her budget. When I explained that the analyst – someone who had an office close to mine at Gartner so I knew he has high ethics and integrity – knew that our employer was a client. He was merely trying to get her to use the services, i.e., inquiry, that the company already bought. There were two mistakes by the analyst. The first was not positioning his statements with “…as someone who is already a client…” so as to make it crystal clear that he was not expecting new purchases. The second was being insensitive to the fact that unless a vendor staffer was an Advisor seat holder, they could not do client inquiries with the analyst regardless of the size of the overall contract. This particular marketing director was not a seat holder, so she was faced with spending a sizable sum to buy an Advisor seat in order to access this analyst’s help – something that the analyst did not know nor made any effort to find out.
If you would like a copy of our SageNote “What You Heard versus What They Said”, please drop us a line at info [at] sagecircle dot com and we’ll be happy to send it to you.
BTW, I am not including the so called “whitepaper for hire” firms in this discussion. They clearly have a business model of writing favorable whitepapers on contract that is very much in the open.
Bottom Line: The whole pay-to-play is a dangerous urban legend that vendors should not buy into. That is not to say that spending money with analysts is not useful. Having a subscription gives you inquiry access to analysts, which is a valuable AR tool, but one that you have to use. Merely writing a check to an analyst firm will not get you any movement in research. It is what you do after writing the check that counts.
Question: Have you ever personally received a direct and explicit pay-to-play pitch by an analyst firm representative, analyst or sales? If so, please contact SageCircle to chat. We will keep all information strictly confidential.
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