IT Purchase Trends in Indian Enterprises

There are many different ways of measuring growth. One is to look at the

actual number of units sold of a particular product. Another is to look at the

actual sales figures, and son on. But the key ingredient required to achieve any

of these figures is only one: intention to purchase. Unless the buyer is

convinced or feels the need to purchase a product, there can be no sale. This is

the fundamental principle that we've analyzed to determine the likely growth in

various enterprise IT categories in the near future. The good news is that more

CIOs intend to purchase IT products and services in the near future as compared

to last year. This growth is 25% on an average, which is remarkable.

Let's analyze this more deeply by looking at the first graph that maps

intention to purchase vs. current ownership. You'll find a very interesting

trend here. The pink line maps the current ownership figures of various brand

categories amongst the CIOs we surveyed this year for the Most Wanted IT Brands

survey. Here, you'll notice that ownership of office PCs is the highest, while

that of ERP software is the lowest. This is obvious, because PC penetration is

much higher than ERP. Now look at the blue line, which maps the intention to

purchase of various IT decision makers for the different categories. Notice

anything interesting? The intention to purchase is much higher in areas where

the current ownership is low. For instance, 44% of the CIOs we surveyed already

had ERP, meaning there were another 66% who didn't currently own it. That's why,

there's considerable intention to purchase ERP software amongst this community.

Likewise, current ownership figure of office PCs is 100%, meaning most CIOs

already have PCs in their organizations. Therefore, the intention to purchase

more office PCs is not as high, and arises only when the organization expands or

upgrades existing machines.

There are however, a few anomalies here as well. Not every product category

depends upon current ownership, or the lack of it. In Application Servers for

instance, current ownership is 64%, and yet the growth in intention to purchase

for the same is only 40%. Though it's good news for app server vendors if 40%

more CIOs intend to buy their products, the growth is not as high as ERP

software. Similarly, you'll notice that 97% of the CIOs already own laptops, and

only 3% don't, and yet 40% more CIOs intend to purchase laptops as compared to

last year. Similarly, we've included all brands we had tracked last year as well

as this year to get an idea of the growth in intention to purchase. The second

graph makes things more clear. ERP is expected to be the highest growth area,

followed by CRM, HRM, Structured cabling, and wireless access solutions. The

number of CIOs intending to purchase products in these segments has increased by

more than 90% as compared to last year.