Cisco has been a world-class leader in networking equipment for the IT industry

Question

Cisco has been a world-class leader in networking equipment for the IT industry for many years.In the past 10 years they have become one of the industry leaders in company acquisitions to expand their market presence with industry solutions, unified communications and collaboration, servers, video technologies, phones, telepresence video conferencing, home networking devices, cable TV converters, digital video surveillance, and many advanced technologies. Cisco is viewed as one of the most admired companies in the world with a very visible CEO, John Chambers, who has made it clear that the future is in networking and the merging of data, video and voice technologies. However over the past couple of years they have had their share of “set backs” with items like their video camera, their tablet and others. Take a look at Cisco’s marketing strategy and discuss how they are changing their market position to become a leader in all of the above areas and how technologies like “unified communications and collaboration” and other new areas on which they are focused will give them access to new markets and new customer segments.Also what changes have they made in their public image to reinforce their leadership in the marketplace?

Will their marketing strategy support their drive for growth?

Explanation / Answer

Cisco Systems is the global leader in computer networking for the Internet. Its networks form an integral part of education, government, business systems and home communications. Cisco hardware, software and service contributions are used to establish the Internet solutions that make complex networks possible, enabling easy access to information anywhere, at any time, by individuals, organizations and countries. Cisco has pioneered the utilization of the Internet in its own business practices and provides consulting services based on its experience and expertise to support other organizations around the globe.

Marketing strategy:

Cisco's strategy is made upon four pillars:

Different strategy:-

MOVE MARKETING FROM PROMOTION TO ENGAGEMENT

Overtly self-promotional marketing content will do little to engage the modern buyer. Try to engage the modern b2b buyer with thought-provoking content mapped specifically to the buyer’s journey.

MAKE CONTENT KING

Cisco’s marketing strategy is based on powerful, value-adding content. When Blair become CMO in 2011, she immediately placed content at the core of Cisco’s marketing strategy.

SHIFT TO A CUSTOMER-CENTRIC MINDSET

Customers won’t care about the features o your product unless it benefits them in some way. Blair and her team “constantly obsess over the customer” assessing their needs, goals, and the right opportunity to present content.

ALIGN SALES AND MARKETING WITH SALES ENABLEMENT

Aligning sales and marketing can be difficult admits Blair. Sales and marketing speak different languages. In 2011, only 20% of the leads generated by marketing were accepted by sales. To improve these numbers, Blair focused on the company’s sales enablement function ensuring winning content and working processes were set in place.

Relationship Strategies

The market-driven concept suggests that putting the customer first in all aspects of an organization results in satisfying all stakeholders, which challenges the belief that multiple stakeholders often have conflicting goals. Market-driven organizations use relationship strategies to form partnerships and alliances with stakeholders to create synergy and minimize or eliminate conflicting goals.

Capturing Market Transitions

Cisco's success also comes from capitalizing on market transitions before they occur. Their goal is to capture these market transitions faster than their competitors by identifying the technologies which play a crucial role in the future of communications and Information Technology.

Acquisitions and partnerships, have been, and remain a core competitive differentiator for the company and a compliment to Cisco's strong internal engineering and R&D capability which continue to produce market leading solutions for our customers.

Continued focus on customers and their needs is a major driver behind both Cisco’s acquisition and partnership strategies. Since its very first acquisition of Crescendo Communications, Cisco has chosen to enter certain growth markets using acquisitions as disruptive innovation tools and has developed unique competences in sourcing, closing, and integrating companies.

The most important validation in an acquisition is the customer validation. Cisco is very focused on how to innovate and provide value to customers as well as be able to take advantage of disruptions to enter new markets. By acquiring smaller companies in the early stages, Cisco can capture technology and move into a new market much earlier than its competition.

For example, Cisco entered the set top box market through the acquisition of Scientific Atlanta, the consumer space with Linksys and the video server space.

Of course acquisitions that aren’t well thought out can be quite counterproductive; remember the tech boom days of the 1990s. Companies spent $3.5 trillion on acquisitions between 1992 and 2000, making those eight years the most active M&A period in history. During the boom, the focus was on acquiring quickly because if you waited, the value shot up as companies went public. Now it’s almost the opposite; since companies are unable to go public that easily, you are almost always better off waiting.

Companies looking at acquisitions must carefully work out the timing of the acquisition, selection of the target, and assessment of risk. The clutch and gas pedal are timing and price. Timing is an art form. If purchasing firms acquire early they could potentially get less assets while if they acquire later, they pay a lot more and may end up with a loss making proposition.

Selection of the target depends on the purchasing firm’s requirements. In transformative acquisitions, purchasing firms discern a new market and see a strategic roadmap and superior profit potential in the long run. A specific deal should, for example, be linked to strategic goals, such as market share and the company’s ability to build a leading position.

Sometimes it’s specific business units who want to acquire a company to address a hole in the product line up or if they are late to market. Purchasing firms should develop strong business development teams who are keenly aware of what’s happening in the industry.

It’s imperative to assess the strategic risk and see if the acquisition makes strategic sense. Purchasing firms need to do customer diligence, evaluating customer experiences with the technology, gauging the technology development risk, and judging the timing and financial risks. Uncertainty and complexity are two variables that purchasing firms must take into account to make the right decision about the right acquisition at the right time.

While "complexity" challenges in acquisitions are real, visible and significant, it is the "uncertainty" variables -- the unpredictability of markets and product success -- that present the larger challenge for purchasing firms. It’s best to buy companies that bring along limited uncertainty.

Cisco’s acquisition strategy involves a global quest for markets and talent. To drive growth, Cisco is constantly on the lookout for billion dollar markets and tries to find the best possible platform to approach them. Cisco also seeks to increase its presence in the markets it is already in.

Trends are influencing insurance companies with regard to customer relevance:

Business progress and success by:

Cisco Commercial Marketing develops and executes programs that support Cisco’s overall company initiatives.

Cisco Internet Business Roadmap The Cisco Internet Business Roadmap is a comprehensive, interactive assessment tool designed to help growing businesses identify the networking solutions and technologies that will best meet their business needs. With this tool, businesses of any size can quickly and easily identify the combined hardware, applications software, and services solutions that best fit the unique needs of their company.

Cisco Mobile Office The Cisco Mobile Office global program provides professionals with the same business-class connectivity regardless of their location – on the road, at work and at home. The program promotes secure high-speed network access in public spaces for mobile professionals and offers the freedom to work anytime and anywhere without the limitation of wires or cables. Cisco Mobile Office solutions provide full access to the complete corporate LAN without compromising speed or security.

Cisco Growing with Technology Awards The Cisco Growing with Technology Awards program recognizes small and medium-sized businesses that display innovation and creativity through the use of networking technology solutions to improve customer satisfaction, drive growth and profitability, increase business efficiency, and gain a competitive edge.

Marketing strategy supports their drive for growth:-

Partner enablement
In order to build a solid base in the channel, organizations that employ a partner-driven route to market must focus on partner enablement. By helping partner teams develop new capabilities and expertise quickly so as to meet customer demands in an ever-changing market, vendors gain sustainable competitive advantage and become party to customers’ success.

Effective communication
While dealing with partners, vendors need to realize that their business goals might not wholly be their partners’ goals. Therefore it is important to give room for differences of opinion and work together to drive a common agenda of acceptance and understanding. This helps to create a healthy competitive environment. In order to ensure that partners build profitable businesses, vendors must hold discussions/conduct forums that will bring to the forefront, intricacies that otherwise go unnoticed.

Road ahead
To ensure that partners address the needs of the customer and are aligned to the vendors’ business vision, a continuous evaluation of partner relationships is essential. As the market transitions to collaboration, virtualization of the data centre and cloud-based services, vendors must work in tandem with partners, share information and ideas, test different practices, understand partner needs/pain points and adopt an approach that matches mutual requirements.

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