by September 6, 2008 0 comments

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.

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