Year: 2012 (Page 4 of 7)

IT Spending in the Financial Industry

August 14, 2012 / hhenry / 0 Comments

In a previous post, we looked at IT spending across the landscape of all major corporate industry verticals of The Global 5000 sized firms and noted that the Financial markets lead the way in terms of spending on IT products and services. Finance covers a wide swath of companies and market niches so we are drilling down a bit further here to look at countries, sub-segments of finance and some specific company examples.

The major powers in the world are naturally where we find the biggest finance spenders. In this case, among Global 5000 companies the largest firms are US, UK, Japan, France, China and Germany. Finance organizations in these 6 countries represent approximately 60% of the finance IT spending market. While many like to rush into new markets to be present when emerging growth starts to ‘pop’ focusing on the big players can obviously pay dividends.

Withing the finance sector, there are many types of organizations that specialize in various products and services. Looking at the 2 largest – banking and insurance, those verticals represent over 70% of the financial IT services market and banking is 50% larger than the insurance market. These two areas dwarf other niches including brokerage, private equity, holding companies and other investment services firms.

Looking closer at banking, US, France, China, UK and Spain are the countries with the largest IT spending. Drilling down further, we find the top 5 banks by IT spending metrics are:

BNP Paribas SA
Banco Santander, S.A.
Bank of America Corporation
HSBC Holdings
Industrial & Commercial Bank of China (ICBC)

In the insurance portion of the financial markets, the major countries leading the way here are: US, Japan, France, Germany and UK. Using the same type of benchmarks applied to insurance company revenues, the Top 5 Global 5000 companies would be:

AXA Group
Allianz SE
Assicurazioni Generali
Nippon Life Insurance
Meiji Yasuda Life Insurance

As you look at market planning and forecasts for serving the financial sector, lining up these segments, countries and individual companies with your own internal systems will help point you in the direction of some of the big spenders.

Gilbane Conference schedule posted

August 7, 2012 / Clea Durrell / 0 Comments

We have published the conference schedule for Gilbane Boston. We’ll be publishing detailed conference session descriptions with speakers in the next week or so including details on the keynote sessions. It is very tempting to provide more details right here but we are still in the process of a few speaker placements we want to finish up first.

The pre-conference workshop schedule, including detailed descriptions and instructors is also available. If you registered for a conference pass that included a workshop before the workshop options were available, you can make your choice now and contact customer service to have your registration updated.

IT Spending by Industry … a way to estimate market potential

August 6, 2012 / hhenry / 0 Comments

Nearly every organization likes to measure its activity and spending by comparing themselves to other like firms in their peer group. Over the years, IT spending has been one area that companies always try to measure this way.

The vendors who supply IT products and solutions have used similar metrics to help define market segments and accounts that may spend more than others and be more attractive candidates.

We took this concept to the companies in The Global 5000 — the 5000 largest companies in the world that are both public and private, across all countries, all industries. Using available research data we find IT spending as a % of revenue that can range from less than 1% for the construction industry to 6% in the financial services industry. The next step was to apply these IT Spending percentages for each industry sector to each company in the database.

Adding up the totals across the database, we find a total of $1.4 trillion is spent on IT products and services by the 5000 largest companies in world. Looking geographically, the countries with the largest amount of IT spend are the 3 largest by GDP as we would expect — US, Japan and China. Those 3 countries represent 52% of the large company spending in the world. Taking this a step further, if you are a provider of IT products or services and participate in markets around the world, a good metric for your business would to have 50% of your revenue coming from these 3 countries.

Looking at this from an industry perspective, the largest spending industries are Financial Services, Oil and Gas companies and the Telecommunications segment. That’s where the money is.

When we look at key industries within various countries the data does show some key differences. For example, in the US, Health Care and Retailers come up strong in the top industries. In Japan, Autos and Industrial segments rise to the top. All of these metrics are worth considering as companies look to decide what markets, industries and geographies to focus on.

We’ll look to explore more details on IT spending by industry and country in the coming posts.

For more details on The Global 5000 database — click here

Harry Henry’s Global 5000 Insights

July 31, 2012 / Frank Gilbane / 0 Comments

Colleague and market research expert Harry Henry is filling a hole in the company research market with his Global 5000 database of the 5000 largest global companies, including both public and private businesses. This is already an important resource for marketers who need to understand global market opportunities more than they ever have before – and that most likely means you, since most of our readers are from mid-to-large size companies who either are or should be growing their international business.

While we focus on the information technology strategies for reaching and engaging with customers and colleagues everywhere, you still need to decide which markets and regions, which industries, and which leading companies to target for growth. Harry has generously agreed to provide regular posts providing insights from his database to help inform those decisions.

Read Harry’s first post China Eyes Canadian Energy Resources. You can follow Harry’s posts on this blog at https://gilbane.com/author/hhenry/. Or you can reach him directly.

China Eyes Canadian Energy Resources

July 31, 2012 / hhenry / 0 Comments

One of the interesting news announcements this week, was about CNOOC of China buying Nexen of Canada – an energy exploration company. CNOOC is a $38 billion company and Nexen reported revenues of $6.3 billion in 2011.

For any company looking at global markets, there are some interesting developments wrapped up in this announcement.

This is a major step for a Chinese company, a major step in the energy industry and a major step for Canada. Consider a few facts compiled from our Global 5000 database.

Canada’s energy assets are substantial. Looking at Global 5000 companies in Canada, right behind Financial Services, Oil & Gas and Mining are the next 2 largest industries representing 27% of the largest companies in Canada. So, as the world thirst for natural resources and energy continues to climb … Canada will get more attention.
Looking at growth rates over the past few years, China has grown faster than the rest of the market. So has the Oil & Gas industry as well as the Mining industry. The total Global 5000 grew 11.4% in 2010 and 12% in 2011. China based Global 5000 companies grew 33.5% and 30% in 2011. Oil & Gas firms reported growth of 22% and 24% for those same years while mining companies grew even more at 40% in 2010 and 30% this past year. So, this deal hits right at the heart of a number of growth segments.
This is a second big deal by a Chinese company in the North American market — see our article earlier this year on the Chinese bank ICBC entering the US market via an acquisition.

The bottom line here is that China’s economy is huge, its growth — even at lower rates — is still a huge differential and it has a continually increasing need for energy resources. Canadian companies have those resources so we can expect more deals and activity.

For more information about The Global 5000 and companies like these that are included, visit the database page.

Welcome Social Media Marketing Manager Mary Stevens!

July 31, 2012 / Frank Gilbane / 0 Comments

We are very pleased to welcome Mary Stevens to the Gilbane Conference team as Social Media Marketing Manager. Mary is already active on our social channels and someone you’ll be hearing a lot from as conference activity ramps up.

In addition to keeping our social channels updated on conference and related activity Mary is a resource for conference attendees, sponsors, speakers, fans, who follow or want to engage and network with the Gilbane conference community. She’ll be updating you more specifically on what that means to you, but in general, she’ll be facilitating communication, conversations, and networking among all stakeholders. For example, we’ll be publishing speaker social media links to help attendees learn more about our speakers in advance of the event.

Mary can be reached via email; she can be found on our Facebook, Google+, LinkedIn pages and groups (buttons below); you can follow her posts on this blog (none yet!); and you can DM her at @gilbane or @gilbaneboston.

Follow the Gilbane Conference!

What technologies is marketing spending on?

July 18, 2012 / Frank Gilbane / 1 Comment

Spencer Ante reports in today’s Wall Street Journal that As Economy Cools, IBM Furthers Focus on Marketers. The title and the short article are focused on IBM’s well-known emphasis on marketers, but the article is of more general interest in driving home the extent of one trend in corporate technology spending – the growth of marketing spending on technology – and provoking a number of questions about what it means. At only 600 or so words the article may be useful for some of you to forward to others in your organization that would benefit by thinking more about the effects of this trend.

The article quotes some recent Gartner research that marketing budgets are roughly 3 times IT budgets as a percentage of revenue, and grew between 2011 and 2012 while IT budgets shrank. Current marketing and IT budgets are both expected to increase, but with marketing budgets increasing at twice the rate of IT budgets – 9.0% vs 4.7%. Gartner has also predicted CMOs will have more control over technology spending than CIOs by 2017. Also, “In total, Gartner says companies spent up to $25 billion worldwide on marketing software last year, up from about $20 billion the previous year. Overall corporate software expenditures totaled $115 billion…”. These are impressive numbers, and our own experience based on discussions with our conference attendees, consulting clients, and other analysts and investors, suggests a broad consensus with the trend. Certainly IBM is big believer.

But the next level of detail is even more important for technology vendors and all CMOs who want to benchmark their competitors spending and strategies – for example, what are CMOs spending money on? what should they be spending on” and how do they organize their infrastructure to learn about, purchase, and manage new marketing technologies, and work with IT?

A vocal segment of the technology press suggest that the future of marketing is all about “social”. A favorite prediction of analysts is that the “Web is dead” and the future is all about mobile. Savvy marketers are beyond such oversimplifications. As important as social and mobile are, I think it is safe to say they are still a small percentage of the $25 billion Gartner number. I would love to be enlightened by anyone who has more details on what the percentage is, and what technology categories others think will benefit most from the increase in marketing spending.

Why is this?

Part of the reason are expensive legacy systems and infrastructures. But a bigger reason is that everyone (not just marketing) is learning. Most of the new technologies have some learning curve, but are not rocket science. The really steep curve is learning how to integrate and utilize new technologies, and especially data they provide, effectively – and that is something we all: technologists, marketers, analysts, will be learning about for awhile.

Learn more at Gilbane Boston.

Our new Gilbane Google+ page

July 16, 2012 / Clea Durrell / 0 Comments

We will be more active on multiple social channels for the Gilbane Conference this year. In addition to Facebook we also have a new page on Google+ for those who prefer it.