How to Use CIO Confidence to Build Sales Opportunities

By Geoffrey James

According to Forrester, a major market research firm, CIOs are primed to buy software this year and many are expecting to over-spend their IT budget. This offers an extraordinary opportunity for software sales over the next eight months.

Every quarter for the Cambridge, Massachusetts-based firm has polled approximately 200 CIOs of North American companies to measure their confidence in the health of their industries, businesses and IT spending. Here are three trends from the most recent study, followed by some suggestions about how you can take advantage of this valuable information.

1. CIOs are more confident about today’s business climate. Of the polled CIOs, 57% cited a strong or very strong current business climate, compared with 36% who responded similarly in Q1 of 2004. CIOs at companies with at least 5,000 employees felt most positive about today’s business climate, a finding consistent with the Q4 2004 poll.

2. CIOs are mildly uneasy about the future. Only 3% of those polled expect a more challenging business climate by Q4 of 2005. Only 14% of these executives, however, expect significant improvement by that time. This compares unfavorably with 23% in Q4 2004 and 18% in Q3 2004.

3. Many IT groups expect to spend more than their budget. Fully 45% of polled CIOs expect to spend more than their 2005 IT budget or at least find new sources of funding. This compares favorably with last year’s figure, which was only 25%. Interestingly, smaller enterprises – those with 1,000 to 5,000 employees – said they are most likely to spend more than their planned IT budgets.

Here’s how to use this information.

  • Summarize the information above in an email and send it to your IT customers. In your email ask them whether they agree with that assessment and whether the information reflects their personal experience and opinion.
  • Examine the responses of customers who respond positively to your email. If the company has more than 5,000 employees look for signs that a positive attitude might translate into a willingness to buy software now rather than latter. If the company has 1,000 to 5,000 employees look for signs of a willingness to overspend its current IT budget.

  • Adjust your next sales call to match your assessment of each customers’ attitude toward their industry’s health. Use the email as a subject for further discussion. When appropriate, segue into specific sales opportunities that match the customer’s overall level of confidence in the future.