SMALL IT FIRMS OUTSOURCE MARKETING

P P Thimmaya & J Padmpriya, Bangalore, September 08, 2008
The Economic Times

Indian technology firms, which have cracked the software codes, are now ready to learn a few marketing mantras and may actually be practicing what they preach. Small and medium firms are seen outsourcing some key marketing functions like making pitch documents, lead generation, power point presentations and even reverse outsourcing (where they appoint a local agency to market their products and services in the US).

Demand is coming from startups seeking to attract potential buyers and investors and those who are looking at sustained growth. Many VCs and PE players are also approaching outsourced CMO (chief marketing officer) or such outfits for their portfolio companies.

A cluster of service providers are mushrooming to capture business from small enterprises, who either lack the bandwidth or cannot afford a high-cost, full-time marketing resource. CMO Axis, co-founded by Vinod Harith, till recently global head of marketing communications for Wipro Technologies, offers to build and run a company’s annual marketing calendar. “We also work for large companies and free management time by taking over functions like blog and website management IT presentations, powerpoint repurposing,” says Harith.

In the same space is Vijay Menon, a freelance CMO, formerly vice president, marketing at QuEST and Infosys BPO. Menon says, these enterprises may not be able to derive benefits from hiring a full-time CMO, who may come at a salary level bill of up to Rs 50 lakh per annum. Obviously, “during a downturn everybody is cautious of hiring a high-cost professional,” one industry player said.

However, Srini Rajam, CEO, Ittiam Systems, makes a clear distinction between marketing and branding. Marketing becomes the fulcrum of any organisation in deciding the road map as well as the genesis of product and services. Some parts of branding activity could be outsourced especially when a product is being taken to the market, he adds.

Gaurav Gupta of Everest Group, says, “it is a long way to go before sales force is outsourced as most companies like to be in control and have their internal systems in place. Outsourcing is catching up in telemarketing and analytics, particularly in financial services sector like credit cards, insurance and the like. Even captives of i-banks, for instance, bring to offshore tasks like pitch documents, power points, analytics and marketing support, he says.

Globally, there is a case for outsourcing for companies in the $20 million-$100 million range and the biggest challenge for them is lead generation and building a brand. The challenge in the marketing outsourcing service provider space in India stems from lack of integration between analytics, market intelligence and marketing functions, says S Sabyasachi, senior director, neoIT, an offshore advisory firm.