A paper written by my classmate and I. Using Euromonitor reports, recent press releases, and more widely available resouces, we attempted to make sense out the specialty coffee house industry. In our paper, we imagined that we were preparing this report for International Coffee & Tea, the parent company of Coffee Bean & Tea Leaf stores. [Note that footnotes and references, including tables and graphics, in our paper seemed to have disappeared once I transferred the paper to this blog. Will try and rectify that as soon as possible. In the meantime, if you need the sources asap, you can insert it in your comment or send me an email or tweet me.]

Coffee Bean & Tea Leaf – Specialty Coffee House

INTRODUCTION

International Coffee & Tea is the parent company of Coffee Bean & Tea Leaf. Founded in 1963, The Coffee Bean & Tea Leaf is a chain of specialty coffee and tea stores. Through its more than 315 stores in California, Arizona, Nevada, Singapore, Malaysia, Korea, Brunei, Indonesia, the United Arab Emirates, Israel, Australia, China, Kuwait, Egypt, Qatar and the Philippines, the company serves more than 100 million coffee and tea beverages throughout the world annually, with annual sales of US$73.6.

The company’s products include coffees, teas, powders and extracts, brewing equipment and grinders, tea accessories, mugs and tumblers, cookies and sweets and the Ice Blended brand of drinks and drink-making kits. International Coffee & Tea is headquartered in Los Angeles.

Over the past five years, The Coffee Bean & Tea Leaf® has grown internationally (in 22 countries) from 217 stores to over 750 at the end of 2008, serving more than 100 million beverages each year, including over 20,000 Ice Blended® drinks each day. Outside of the United States, The Coffee Bean & Tea Leaf has presence (outside USA) in Brunei (4 outlets), Malaysia (10 outlets in East Malaysia; 40 outlets in Peninsula Malaysia), China (23 outlets), India (5 outlets), Indonesia (30 outlets), South Korea (163 outlets), Philippines (25 outlets), Singapore (45 outlets), Sri Lanka (3 outlets), Vietnam (3 outlets), Bahrain (3 outlets), Egypt (11 outlets), Kuwait (11 outlets), Oman (1 outlet), Qatar (5 outlets), Saudi Arabia (7 outlets), United Arab Emirates (16 outlets), Israel (14 outlets) and Mexico (5 outlets). Stores in Peninsula Malaysia and Singapore are company owned and operated. Stores in other territories are run by franchise operators. Our international expansion out of USA has been done via franchising and the opening of company-operated stores. For growth in number of stores annually, see Appendix A.

The Coffee Bean & Tea Leaf® can be found in neighborhood locations and other nontraditional locations such as – grocery stores, shopping malls, military bases, airports and university campuses. Potential for expansion still available for franchising opportunities in Europe, parts of Middle East, parts of Asia, Australia, New Zealand, South America, Central America (other than Mexico) and Canada.

With the global financial crisis impacting our business in 2008, how can we at Coffee Bean & Tea Leaf, maintain our markets, increase our revenues and expand our markets?

CURRENT STATE OF THE SPECIALIST COFFEE SHOP INDUSTRY

Although accounting for only 7.5% of sales in the US$395 billion cafés/bars sector, specialist coffee shops have been the growth leader over the year 2008, as consumers demand a caffeine jolt in a relaxed, up market “third place” between home and work/school. Although value sales growth in specialist coffee shops has outrun unit expansion in most years, it trended downwards in 2007, amid slowing consumer spending in many major markets, as well as further expansion into lower-income emerging markets. In 2008, it dropped further, brought down by a severe slowdown at Starbucks, by far the largest chained operator, which closed hundreds of outlets due to falling sales and consumer traffic.

In Singapore, chained specialist coffee shops was the fastest growing subsector in 2008 with value sales rising 15%, due mainly to major chains proliferating in both city and suburban areas. Coffee Bean & Tea Leaf and its closest rival, Starbucks, expanded aggressively into heartland malls to compete against each other. See Appendix B for more details of the industry in Singapore.

Western Europe and Asia Pacific continue to be the primary sales drivers in cafés/bars, owing to well-entrenched café and drinking cultures, with just five markets (Spain, Japan, Italy, the UK and South Korea) accounting for half of 2008 global sales, while together the two regions combined for well over half the world’s outlets. Growth collapsed in North America in 2008, with the US housing meltdown and its subsequent effect on consumer spending having a hugely negative impact on discretionary cafés/bar purchases. Starbucks saw sales fall by US$470 million compared with 2007, a far cry from the double-digit annual growth the chain has enjoyed over the last 10 years. As they have elsewhere, consumers in the US and Canada have cut back on visits to cafés and bars, spending less when they choose to indulge, and purchasing more from supermarkets and other retailers. The strong push into coffee led by fast food retailers such as McDonald’s and Dunkin’ Donuts has siphoned traffic away from the previously booming specialist coffee shops sector. With the lackluster results posted by the industry, Starbucks’ posting of it latest financials were eagerly awaited.

On 5 November 2009, Starbucks announced strong 4th quarter 2009 results. Although net revenues were $1.7 billion in Q409 compared to $1.8 billion in Q408, with the decline due to decreased revenues from fewer company-operated retail stores; non-GAAP U.S. operating income for Q409 was $206.8 million compared to $79.5 million for the same period a year ago. Non-GAAP operating margin expanded to 12.0% in Q409 compared to 4.4% in the corresponding period of fiscal 2008. As illustrated by the Starbucks’ results, survival in the industry will depend on higher productivity (lower costs, increased labour efficiency and reducing product waste); brand differentiation; an increased focus on food is key as more operators look to drive traffic at all times of day; and the continuation of the “third place” principle as experience will remain all-important, even in a time of economic difficulty, consumers will still demand a “third place” for relaxation and socializing.

COMPETITORS: INDUSTRY RIVALRY

Within the territories in which the Coffee Bean & Tea Leaf operates, the competitive landscape is summarized below.

US

Despite its recent decline, Starbucks Corp is still the leader in the US chained coffee specialists subsector, with an 88% value share in 2008. Next on the list is Caribou Coffee with 3% share of total outlets in 2008 (about 60% of its outlets are located in places posing little threat to Starbucks – Minnesota or Illinois). Market saturation and maturity will affect this sector over 2009. Although some chained and independent coffee shops, cafés and bars will close, there is still an overabundance of specialty coffee outlets, and currently demand does not equal supply. More outlets are expected to close in the coming years, with the number predicted to decline by 3% over the forecast period.

Singapore

In Singapore, the three largest chain specialist coffee shops are Starbucks, The Coffee Bean & Tea Leaf, The Coffee Connoisseur (owned by Sarika Coffee Co (S) Pte Ltd. Other smaller competitors are Coffee Club, Spinelli’s, Pacific Coffee, Gloria Jeans, Trung Nguyen Cafe Chain, San Francisco Coffee and Coffee Connection. See Appendix B for more of their brand shares in Singapore. Competition is high between the players. Leading companies are Starbucks Coffee Singapore Pte Ltd and Coffee Bean & Tea Leaf (Singapore) Pte Ltd, both of which compete against emerging cafés/bars which have started offering similar ranges of premium quality roasted coffee along with a wide menu of desirable food choices.

 The latest newcomer to the scene is Trung Nguyen Coffee, a Vietnamese coffee chain with over 1,000 retail establishments in Vietnam is an emerging franchise brand that focuses solely on brewing Vietnamese coffee. At the end of 2008, it had three outlets in Singapore and is slated to open another four more in 2009. Competition between specialist coffee operators is expected to intensify over 2009 as each will drive for high-traffic locations in upcoming malls and integrated resort projects.

Malaysia

Smaller international as well as local chains such as San Francisco Coffee Co, Gloria Jean’s and Hoca Coffee registered weaker performance than large international chains such as Starbucks and The Coffee Bean & Tea Leaf. In 2008, we, Coffee Bean & Tea Leaf advertised aggressively through print media as well as in-store advertisements during its launch of The Coffee Bean Card in January 2008. Both Starbucks and The Coffee Bean & Tea Leaf invested sizeable resources in advertising and promotions to boost their businesses and enhance their brand names. Over the forecast period, chained specialist coffee shops are likely to expand to office buildings so as to target the working class, who are more willing to splurge on high-end coffee to indulge, comfort and energise themselves while being hard at work.

Rivalry is high but scope for expansion for the brands is high as theyare likely to expand to East Malaysia in line with the rapid development of retailing landscape in this second-tier region of the country. In keeping with the high rivalry, prices of items at cafés/bars are likely to drop gradually over the forecast period with competition intensifying, with players likely to offer more promotions or even value set meals to attract consumers.

Philippines

In 2008, Starbucks saw the largest leap in shares in terms of value sales from 45% in 2007 to 49% in 2008, and remains at the top. Other competitors are Seattle’s Best, Gloria Jeans, Coffee Bean and Tea Leaf, local outfits Figaro Coffee Co and Bo’s Coffee. Emerging local brands like Café de Lipa are keen to diversify away from the Western coffee shop image in terms of pricing and product line (using local coffee brews). Prospect for the next few years is this: specialty coffee shops will continue to improve their performance in the market by pushing strategies aimed at younger age groups, focusing more on the young professional, mid rank employees and private school students, besides their typical market of accomplished professionals and executives. The aggressive expansion strategy of players breeds greater competition among domestic and local players.

South Korea

In South Korea, the biggest competitor remains Starbucks as it continued to dominate the specialist coffee shop segment during 2008. In recent years, we have seen new competitors in local chained brands like Holly’s and Angel-in-us. Starbucks has 271 outlets, while we, Coffee Bean & Tea Leaf have 163 outlets . Prospects for this sector for period 2008 to 2009: Demand for espresso coffee will increase over the forecast period at an annual average rate of 2%. However, owing to increasing maturity of this sector, the growth in the number of new specialty coffee stores will be lower over the forecast. Local specialty coffee chains are expected to continue to increase their value shares at the expense of leading international chains.

India

Domestic brands, Café Coffee Day, Coffee Day Express, Barista and Java Green, dominate the specialist coffee shop sector in India. Multinational player, Costa Coffee (sixth largest in brand share) , Gloria Jeans and Coffee Bean & Tea Leaf will provide strong competition in the period 2008 to 2009. The rivalry will be intensifying as Gloria Jean’s Coffee and The Coffee Bean & Tea Leaf are expected to give tough competition to brands such as Barista and Café Coffee Day which have lost their novelty factor in the big cities. As such, the competition in this category is expected to intensify over 2008 to 2009. International brands like Starbucks and Aroma Café are set to enter into the Indian market in the period 2008 to 2009. As the specialist coffee shops landscape gets more saturated, outlet expansion is expected to slow over the next few years. The brands will find it increasingly difficult to differentiate themselves and find it increasingly difficult to compete head-on for lucrative locations and the same urban youth consumer base.

Indonesia

Global brands Starbucks and The Coffee Bean & Tea Leaf, occupied the first and third positions in chained specialist coffee shops, respectively, in 2008, while a local brand Excelso Café managed to rank second. Starbucks and The Coffee Bean & Tea Leaf are found mainly in major cities, Excelso Café (operated by Excelso Multirasa PT), on the other hand is also found in smaller cities like Bogor, Yogyakarta and Malang,. Prices of products offered by Excelso Café are more affordable compared to Starbucks and The Coffee Bean & Tea Leaf. Therefore, it is able to reach a wider consumer base. Specialist coffee shops will be expected to continue to show the fastest CAGR within café/bars in terms of outlets, volume transactions and constant value sales over in 2008 to 2009. As it is emerging from a smaller base, companies are expected to be more aggressive in terms of promotions and expansion. One area international chained coffee shops could attract market share is in ‘localizing’ a few of their menu items to suit local palates. Apart from this, these outlets could attract middle- and upper-income consumers to meet communally in their outlets.

China/Hong Kong

Chained specialist coffee shops continued to be led by Starbucks, which opened its 100th outlet in April 2008. Behind it is Pacific Coffee. As the coffee consumption market reaches maturity, both Starbucks and Pacific Coffee are digging deep into their traditional market of coffee drinkers. This is evidenced by the location of their stores: across Hong Kong Island and Kowloon, targeting the working class and those willing to pay a premium price for coffee.

Israel

All of the specialist coffee shops in Israel carry local brands, with the exception of Coffee Bean & Tea Leaf (who seem to be the only foreign multinational player); with Starbucks clearly missing in the lineup of specialist coffee brand names. Local specialist coffee set ups are, to name a few: Aroma Espresso Bar, Café Café, Café Joe and Arcafe. Chained specialist coffee shops are expected to continue to expand over the forecast period despite the recession. Nevertheless, Aroma Israel and Cafe Cafe claim that in 2009 they will need to be more careful in location choice and amount of outlet expansion. Smaller chain Café Joe prefers to focus and improve on its existing facilities. The need for company differentiation will continue to be a strong company driver, as the focus on health and healthy lifestyles will continue to play a strong roll in company differentiation. Consumers are becoming more concerned with issues such as fair trade, recycling, organic and social responsibility.

In summary, for the territories within which Coffee Bean and Tea Leaf operates, the rivalry among competitors in the industry is high. The global economic crisis has raised the level of competition between the competitors even more. Companies are required to compete on all fronts – price, selection of products (which includes not only espresso items, but also teas, pastries and other food items), brand differentiation (e.g. in terms of promotion of a healthy lifestyle or social responsibility), and location.

For territories within which Coffee Bean & Tea Leaf does not operate, the situation is more diverse. The paragraphs below summarise the competition between companies in a selection of those territories. Four have been chosen, UK and France as a representative sampling of Europe; Brazil and Argentina as a representative sampling of South America.

UK

The rivalry between specialist coffee houses is high. With a few chains competing against eachc other for a share of the market. Starbucks had increased the number of outlets by 40 locations in 2008 (rising to 650 stores) but had performed poorly over the year. Increased competition from brands such as Costa Coffee and Caffè Nero, and poor macroeconomic conditions overall lowered the Starbuck’s average sales per outlet. Costa Coffee brand achieved the strongest growth in 2008, and is now the leader in chained coffee shops in UK. Rivalry within the sector is high with branded players, such as Costa Coffee, The Wild Bean Café and Caffè Nero, continuing to increase the numbers of their locations over 2008 to 2013 period.Starbucks is likely to see many of its UK outlets continuing to close into 2009 and 2010.

France

Starbucks Coffee France SA has a massive 41% share and McDonald’s France SA with 16%. There is strong competition between Starbucks Coffee and McCafé. [For more on McCafe, see section on New Entrants below.] Chained specialist coffee outlets are likely to expand their network in all major French cities. As the concept of coffee shops is particularly well-known by tourists and young adults due to their travels, chained coffee shops are likely to open new outlets in cities such as Bordeaux and Strasbourg which attracts both tourists and students; and will increase their presence in semi-captive environments such as airports and rail stations. The outlook for specialist coffee shops here is that as the category is still at an early development stage, it should still enjoy healthy growth, at a projected 16% CAGR in constant value terms.

Brazil

The top four leading companies are Rei do Mate, Água Doce, Café Pelé and Fran’s Café, together accounted for more than 55% of value sales in 2008. Other companies include Starbucks , Suplicy Café, Octavio Café, In Bocca al Lupo, Café Ritazza and McCafe. Newcomers such as Havanna Café, Vanilla Caffé and Pelé Arena & Futebol have plans to continue to expand despite the economic slowdown. The outlook is that specialist coffee shops, especially those with a franchise system and able to reach states in which they are not yet present, will show the fastest growth in terms of outlets, transactions and value sales over 2008 to 2009. McCafé, Grão Espresso, Rei do Mate, Vanilla Caffé and new Pelé Café Arena & Futebol are likely to outperform in 2008 and 2009.

Argentina

There are many major players, nearly all local, in the specialist coffee shops sector here: including, Havana Café, Bonafide, Café Martinez, The Coffee Store, McCafe, Aroma Café and Starbucks. There is low penetration of international chains in this market – they represent a 0.5% share of the total sales in cafés/bars, and 7% of chains. This is mainly due to the fact that their global concept is not adapted to the tastes of demanding Argentinean consumers. Although the international chains have a small presence, there is still margin for growth in this sector. Particularly, there is still room for growth of outlets in high income areas and shopping centres.

Potential new markets for Coffee Bean & Tea Leaf

Of the four territories set out above, Coffee Bean & Tea Leaf has most potential of penetrating into France, Argentina and Brazil. The reasons are:

1. For France, the outlook for specialist coffee shops here is that as the category is still at an early development stage, it should still enjoy healthy growth.
2. For Brazil, specialist coffee shops, especially those with a franchise system and able to reach states in which they are not yet present, will show the fastest growth in terms of outlets.
3. For Argentina, there is still room for growth of outlets in high income areas and shopping centres.
4. There is already in place in the 3 territories a coffee drinking culture.

Industry rivalry in the form of fast food operators

Since 2008, Euromonitor has included McCafe as a chained specialist coffee shop. McCafe, owned by McDonald’s, has been making inroads into the coffee drinking culture using current resources provided by its McDonald’s outlets. In Europe, McCafe has yet to penetrate UK. However, McCafé outlets have been growing in number in Italy where it has 65. In Argentina and Brazil, McCafe is positioned ahead of Starbucks in brand shares rankings. In the US, towards the latter half of 2008, Dunkin Donuts and McCafe pirated the premium coffee culture trend started by Starbucks, and both players started making inroads into Starbuck’s customer base with increased offering in the premium coffee category.

According to the 2009 Brand Keys Customer Loyalty Engagement Index, Dunkin Donuts and McDonald’s were placed first and second, respectively, and Starbucks, third in the coffee category. This indicates that customers preferred the two fast-food brands rather than the “pure” specialist coffee shops. Coffee Bean & Tea Leaf should, therefore, consider fast food brands like Dunkin Donuts and McCafe as competitors within the industry, and strategise with these players in mind. The impact of the industry rivalry force created by the competition between specialty coffee retailers is high.

The growth of the industry has slowed while the number of competitors within the industry has increased. Both of these factors, in addition to Dunkin’ Donuts and McDonald’s high strategic stakes in the specialty coffee industry and continued focus on selling high-quality specialty coffee beverages at a low cost have caused strong industry rivalry.

POTENTIAL NEW ENTRANTS

The economies of scale within the specialty coffee industry have increased as the size of the top players has increased.

1. Increased economies of scale within the specialty coffee sector.
2. Companies such as Dunkin’ Donuts and McCafe have national distribution channels through which they can transport their specialty coffee at a relatively low cost compared to potential new entrants who have no such developed distribution systems.
3. These larger companies are able to reap economies of scale through their purchasing by negotiating long term contracts with coffee farmers and purchasing coffee beans in bulk quantities at discount prices.
4. Most of the favorable store locations within the larger metropolitan areas have already been occupied by current competitors within the specialty coffee industry.
5. Many companies now have proprietary product technology involved in the production of their specialty coffee as well as lower per unit costs due to an experience curve.
6. The industry has progressed toward more subjective traits such as the ambience of the store, the social responsibility of the company and brand identification.
7. Many companies have gained very loyal customer bases stemming from their past advertisements, customer service, objective product differentiations and early entry into the industry.

From the observations made above, we concluded that the barriers to entry in the specialty coffee industry are very high.

SUBSTITUTES

The global financial crisis in 2008 has made cheaper substitutes to specialist coffee products more desirable, as they are cheaper and, hence, more accessible. As specialist coffee is highly dependent on the high level of disposable income available, the financial crisis has reduced this disposable income causing a fraction of customers to choose cheaper alternatives for their daily caffeine fix. Cheaper local brews are dominating the market in several territories.

In Singapore, e.g. traditional coffee houses such as Ya Kun Kaya Toast and Ah Mei Café are expected to blossom over the short term. These modernised coffee houses provide a sense of familiarity in a comfortable setting. In Malaysia, local coffee shops known as kopitiams, are found spread widely across the rural landscape of Malaysia. These outlets serve breakfast as well as other local fare. In South America, the local specialist coffee chains have been offering brews for lesser than those offered by international chains.

Apart from the cheap local brews, other substitutes for caffeine fix are:

1. The caffeinated soft drinks offered by Pepsi and Coca-Cola. However, these substitute products pose little threat to the premium coffee industry.
2. Coffee has gradually gained preference over carbonated soft drinks. This is mostly attributed to the health concerns associated with carbonated soft drinks and the new evidence showing coffee as a relatively healthy alternative. (Harding, 2000)
3. Tea. Although tea products have become part and parcel of the menu for chained specialist coffee houses, there are companies which concentrate on just serving tea. However, tea houses pose little threat to the specialist coffee houses.

The threat from substitutes is low to medium, with the players serving the local cheaper brews ranking higher than the others. To minimize this threat, Coffee Bean & Tea Leaf should remain on its present course in providing quality products (beverages and food items) in a pleasant ambience (the third place).

For territories where there are strong local tastes in certain foods or beverages, we should allow the franchise operators flexibility in adapting to those tastes.

CUSTOMERS

1. The primary customers are individual consumers who are middle to high income earners, with a fair amount of disposable income.
2. Customers of specialist coffee houses face no switching costs and have an enormous selection of retailers from whom they can buy.
3. The threat of backward integration (in terms of the losing the customers as they could provide the service themselves) is minimized by specialist coffee houses themselves offering for sale premium coffee beans and coffee brewing equipment.

The bargaining power of customers has increased: With the global financial crisis hurting the main group of customers the most, this group has modified their consumption patterns. This is evidenced by the drastic closure of stores by the largest chained specialist coffee houses, Starbucks. This group of customers, with less disposable income looks for cheaper substitutes, or reduces their number of visits – cutting back and trading down.

For trading down, customers can either opt for cheaper substitutes or brew their own cuppa. For the latter, Coffee Bean & Tea Leaf have for sale, premium coffee beans and coffee brewing equipment. In line with this, Starbuck’s strategy of offering instant coffee for sale in the form of VIA needs to be watched closely.

We can also watch carefully how we price our products – seeking possible ways to provide value for money to our customers via meal offerings (beverage plus food item at discounted prices) and customer loyalty programs. Apart from the above, to maintain customer levels we must aggressively promoted themselves as necessary parts of the day — not merely as places to have morning coffee or coffee after work — with emphasis on food and ambience, and promoting our outlets as places to enjoy good-quality food and coffee in a pleasant environment.

SUPPLIERS

Coffee is a tropical plant which grows between the latitudes of 25°N and 25°S (see Appendix C). It requires very specific environmental conditions for commercial cultivation. The coffee plant is easily damaged by frost, a danger either in southern Brazil or, closer to the Equator, at altitudes around 2000 metres. Prices of coffee also fluctuate as the weather dictates. Nevertheless, any price increase in the raw material is not directly benefited by the growers, to a large extent – the increases benefit only the middlemen. We, at Coffee Bean are cushioned from price increases as we source our beans direct from the growers. Inadvertently, this process allows our suppliers much more bargaining power. However, we also view our relationship with the growers as long-lasting, and nurture it as such. Nevertheless, our selection guidelines for coffee beans soften the impact of higher supplier bargaining power.

Note: A development to monitor is the trend for coffee producing countries to take over the direct selling of coffee beans they produce.

A substantial cost for our business is property leasing costs. With the financial crisis still not showing significant improvements and the overall subdued sentiment of the property markets worldwide, we are confident that there will be no significant upward trend in property rents.

SUMMARY OF ANALYSIS

After applying Michael Porter’s five forces model to Coffee Bean & Tea Leaf environment, it can be inferred that the force created by industry rivalry has resulted an extremely competitive environment where differentiation is increasingly difficult and price wars are looming. The strength of the force imposed by the potential for new entrants is lower as a result of more formidable barriers to entry. The bargaining power of both suppliers and buyers are high as a result of increased unity among the suppliers and the accessibility of information among buyers. The threat of substitutes is significant given the cheaper substitutes available in the market.

OUR RECOMMENDATIONS

1. Maintain our current prices: The global financial crisis has not recovered. Any shifts upward in our pricing could result in backlash from our current customers.

2. Increase our value-for-money offerings: We can do so in packaging meals so that customers pay lower for paired items; and through our store loyalty programs. We should increase publicity in our store loyalty programmes.

3. Expand our selection of foods: This is to ensure we attract customers all day long – not only in the early mornings and before dinner. With regard to this, it is also wise for us to consider the local tastes of the customers and allow our stores to design products that are suitable to these tastes and preferences.

4. Enhance our product development efforts: As our customers cut back and trade down, we should consider these as opportunities to develop products that will fulfill their needs. An possibility is to develop our own brand of instant coffee. Additionally, as we are also offering for sale equipment for coffee brewing, we may enhance our customers experience by conducting workshops to help them brew a better cup of coffee.

5. Expand into territories which offer potential, like France, Brazil and Argentina. These territories offer opportunities for growth, and they are suitable in that there is present a coffee drinking culture. Moreover, in Brazil and Argentina, we have the added benefit of reduction in cost of transportation for our coffee beans.

6. Increase productivity and reduce waste: We need to discover ways in which our in-store productivity increases through better management of our supply chain management, and work processes.

Appendix A

Annual growth in number of stores

Year  Company owned Frachise

2002: 177 / 46

2003: 191 / 63

2004: 217 / 87

2005:  241 / 137

2006:  270 / 230

2007:  288 / 377

2008 : 278 / 444

Source: Coffee Bean & Tea Leaf. 2009. Company Growth. Retrieved from http://www.coffebean.com.

Appendix B

Singapore: Specialty Coffee Shops – brand shares

Brand Shares of Chained Cafés/Bars 2005-2008 % value Brand Global Brand Owner 2005 2006 2007 2008

Starbucks 17.4 19.1 18.7 18.0

Coffee Bean & Tea Leaf 21.9 20.5 18.7 17.2

Coffee Connoisseur, Sarika Coffee Co (S) 11.6 13.8 15.3 15.9

Bakerzin Baker’s Inn Holdings 5.6 4.4 4.1 5.8

Coffee Club Coffee Club Pte Ltd 4.3 4.6 4.7 4.6

Ya Kun Kaya Toast Ya Kun International 4.3 4.2 4.7 4.3

Harry’s Bar Harry’s International 2.1 2.1 4.6 4.2

Spinelli Spinelli Coffee Co Pte Ltd 3.5 3.4 3.2 3.3

Dôme Dôme Coffees Australia 3.2 2.6 3.1 3.1

Pacific Coffee Pacific Coffee Co 2.4 2.8 3.0 3.0

Killiney Kopitiam Killiney Kopitiam Pte Ltd 1.8 1.8 3.0 2.6

Gloria Jean’s Jireh International Pty – - 0.9 1.8 Ltd

McCafé McDonald’s Corp 0.5 0.7 1.2 1.2

Trung Nguyen Trung Nguyen Cafe Chain – - – 1.0

San Francisco Coffee Co – - – 1.0

Caffè Ritazza SSP Group Ltd – 0.5 0.5 0.4

Europa Pubs & Bars ABR Holdings Ltd 2.6 – - -

Caffè Ritazza Compass Group Plc 0.5 – - -

Others 18.4 19.6 14.3 12.5

Total 100.0 100.0 100.0 100.0

Source: Trade associations, trade press, company research, trade interviews, Euromonitor International estimates

Appendix C

Map showing areas of coffee cultivation

r:Coffea canephora m:Coffea canephora and Coffea arabica a:Coffea arabica

Source: http://upload.wikimedia.org/wikipedia/commons/9/96/Carte_Coffea_robusta_arabic.png This map is from Wikimedia Commons. Commons is a freely licensed media file repository.

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Check this post Team Coaching: allenarsi a lavorare in squadra from 7thFLOOR» Business Online e Comunicazione Digitale, Web Marketing e New Media, Formazione Coaching per le Imprese e la Cultura:

Lavorare in team non è affatto facile: la diversità è un elemento di ricchezza che però, se non è gestita correttamente, può creare diffidenza ed ostilità. Le persone sono più impegnate a mantenere i loro schemi di riferimento abituali, a difendersi piuttosto che a sviluppare la creatività per la risoluzione dei problemi comuni. Un ottimo strumento è il Team Coaching …

Not only do they link one of my blog posts from their home page but they also provide links to great competitive intelligence articles from all over the web.  And I touted their website in my talk this week on competitive intelligence in San Francisco and pointed to several references I found there as resources.

Thanks SCIP (Society of Competitive Intelligence Professionals)!

Check this post POP Workshop: il Metodo Robin Good from 7thFLOOR» Business Online e Comunicazione Digitale, Web Marketing e New Media, Formazione Coaching per le Imprese e la Cultura:

You need to a flashplayer enabled browser to view this YouTube video Altri articoli sullo stesso argomentoAdSense And Robin Good: The First Italian To Earn His Living From Google – The 7thfloor Interview Leggo attraverso il bellissimo MasterNewMedia.org del nostro più conosciuto “media guru” italiano, Robin Good, gli apprezzamenti per il nostro…[...]

Check this post POP Workshop: il Metodo Robin Good from 7thFLOOR» Business Online e Comunicazione Digitale, Web Marketing e New Media, Formazione Coaching per le Imprese e la Cultura:

You need to a flashplayer enabled browser to view this YouTube video Altri articoli sullo stesso argomentoAdSense And Robin Good: The First Italian To Earn His Living From Google – The 7thfloor Interview Leggo attraverso il bellissimo MasterNewMedia.org del nostro più conosciuto “media guru” italiano, Robin Good, gli apprezzamenti per il nostro…[...]

Check this post Key Intelligence Topics from Everyone’s Blog Posts – Competitive Intelligence:

Cited by: http://www.corporaterisks.info/

I. Assessment of Strategies

A. Focused Differentiation
B. Best Cost
C. Differentiation
D. Low Cost
E. Focused Low Cost
F. Market Skimming
G. Market Penetration
H. Related Diversification
I. Unrelated Diversification
J. Backward Integration
K. Forward Integration
L. Horizontal Integration

II. Consumer Perceptions

A. Negative Moment of Truth
B. Positive Moment of Truth
C. Usage
D. Attitude
E. Image
F. Market Segmentation
G. Customer Satisfaction
H. Brand Recall
I. Purchase Decision
J. Brand Association
K. Value Creation
L. Lifestyle
M. Personality
N. Product Attributes
O. Country of Origin

III. Current Operations

A. Value Chain Analysis
B. Benchmarking Analysis
C. Five Force Analysis
D. Brick & Click Strategy

IV. Competitor Capabilities

A. OODA Loop
B. Offensive Maneuvers
C. Defensive Maneuvers
D. Flanking Maneuvers
E. Guerilla Maneuvers

V. Evaluation of Market Life Cycle

A. Market Crystallisation
B. Market Expansion
C. Market Fragmentation
D. Market Consolidation
E. Market Dissolution

VI. Service Triangle Interplay

A. Service Strategy
B. Systems & Procedures
C. People of the Organisation
D. Service Strategy – Customer – People of the Organisation
E. Systems & Procedures – Customer – People of the Organisation
F. Systems & Procedures – Customer – Service Strategy
G. Service Strategy – Systems & Procedures – People of the Organisation

Vivek Raghuvanshi
Assistant Professor
http://amity.edu/aici/

Check this post Double Response Rates for Your Win Loss Analysis Program from Primary Intelligence» Sales and Competitive Intelligence Blog:

Imagine that you’ve just learned that a prospect has elected to go with the competitions solution instead of yours. Your sales team did everything they could to understand the prospects needs and build the relationship. Your product managers and marketing executives provided excellent support as well as thorough well-thought out responses to all the prospects product-related questions. The demonstration of your solution went exceptionally well. Management was actively following the opportunity, and everyone thought you were going to win. The deal was an important one because of who the prospect was, or the absolute size of the deal, or the industry the prospect was in, or a combination of these things.

Now everyone wants to know why you lost.

Your prospect just selected the competition, and youve been tasked with calling the decision makers to find out exactly what happened and learn everything you can about why they chose the competition.

You spend the next three weeks leaving messages, but they dont call you back, or you catch them live on the phone, but they don’t have time to answer your questions. Now what?

One of the constant challenges that we face in the execution of win loss analysis is maximizing response rates or participation rates. That challenge is even greater in this type of market research because sample is limited and you only have a finite number of competitive wins and losses you can study. If we aren’t able to get them to participate, it is a missed learning opportunity that we cant necessarily duplicate.

The example above is probably one youre familiar with if you are involved with your companys win loss program. The question becomes, How can we increase our response rates?

At Primary Intelligence, we spend a lot of time and resources addressing this very question. There are quite a few things we do to increase participation rates for our customers, but one of the most important practices we have identified is to create and utilize what we call introduction notes. These are notes that introduce why you want to talk to the decision maker and what you are hoping to accomplish. While the content of this note is very important to improving response rates, who this note ultimately comes from can be even more important than the words you use . There are three potential options when it comes to deciding who the introduction note will come from:

1. From a key executive (higher the better, with CEO being best)
2. From the sales representative responsible for the deal
3. From you

To successfully implement this practice, you will need to choose which of these three options will work best for your situation and then create two introduction note templatesone for your wins and one for your losses. If you analyze your no decision deals, you will want a different introduction note for that as well.

The introduction note really helps remove the surprise attack feeling that decision makers can get when you are cold calling them to do a debrief of their purchase decision. Cold calling a decision maker is a lot like the solicitor that knocks on your dooryou open the door expecting someone you know and instead get a complete stranger that wants to wash your windows or aerate your lawn. Surprising a decision maker is a sure way to kill response rates for your win loss analysis program.

There are five key elements to include in the introduction note that you will send on behalf of an executive, the sales representative, or yourself:

1. Introduce the executive, the sales rep or yourself at the beginning of the note
2. Introduce the purpose of the e-mailto understand how you can improve
3. Ask them to be candid and forthcomingwe learn the most from our mistakes
4. Identify the amount of time youll need for the interviewbe specific and honest here
5. Let them know when you plan on calling to schedule the interview at their convenience

Even though there are a lot of elements you need to include, it is important that you keep your note brief and to the point. For these notes, straightforward information and a simple request will be your most persuasive argument.

Introduction Note from Key Executive

This is your best option for improving participation rates. You can send the e-mail on behalf of the executive, but you will want the executive to understand what youre doing and have him or her sign off on the processas they could get replies from decision makers and they will need to be in a position to respond to those replies. C-level executive sponsorship will do wonders for increasing response rates, with the CEO being the best possible option.

This approach is easiest if you have a direct executive sponsor. You will be sending the e-mail on behalf of the executive you ultimately get to sponsor your efforts. This way, you have complete control over the process and your efforts wont be held up by the executives busy schedule.

When you have an executive sponsor, you will want to emphasize to respondents that they can reach out to the executive if they have any questions or concerns. Make sure your executive is prepared for this situation, as it can really have a positive impact on decision makers when they see your companys commitment to them and improving your solution to meet their needs.

Introduction Note from Responsible Sales Representative

If you cant get an executive sponsor, the next best solution is to involve sales in the win loss analysis process. An important distinction here is that the sales rep responsible for the deal should not be doing the interview with decision makers. Decision makers will filter out information they perceive to be negative if the sales representative is the one doing the interview with them. See my post on sales-derived versus decision maker-derived win loss analysis for more on this topic.

In order to get sales support, you will likely have to overcome some natural anxiety that the sales representative will have with you contacting the people they were selling to. You will want to reinforce that this process is to identify areas for improvementto help them sell moreand not a witch hunt. Dont be too hard on your sales repsimagine how you would feel if someone said they were going to come in and analyze how you were doing your job. Its natural for them to feel some discomfort, but once they see the results of your efforts and how you intend to leverage those results, this discomfort and anxiety should fade away.

You will want to send the e-mail on behalf of the sales representative so that you can control the process, although we have quite a few customers that have their sales representatives send the introduction notes directly. A sales representative introduction note differs in a few ways from an executive introduction note. You will want to add the following elements to your sales introduction notes:

1. Reinforce that you are not trying to re-engage the sales process (applies to losses and no decisions)
2. Make the request for a debrief a personal request on behalf of the sales repleverage the relationship the sales person has with them

Introduction Note From You

If you are utilizing this method it means that you werent able to get executive sponsorship or sales support in your efforts to review why you are winning and losing. Dont worry, you can overcome this lack of sponsorship and sales support by pressing forward and gathering actionable data that you can share with both executives and sales. Utilize the data to accomplish your objectives, but dont be selfish with it. Share the data with everyone you think could benefit from it, including the CEO (trust me, these guys are ALWAYS interested in why you are winning and losing), product management, product marketing, sales support, sales management, marketing, and sales representatives. In our experience, it only takes sharing a couple of reviewed opportunities (especially losses) before both executives and sales will recognize the value of the intelligence and get on board with the program. However, this cant happen if you arent sharing the dataIve seen too many cases where this valuable intelligence isnt shared across the organization.

The most important thing to remember about introduction notes that are coming from you is that you are letting the decision maker know why you want to talk to them and removing that surprise element. Practicing this will improve your response rates, but your real goal is to upgrade your program to the executive-level introduction notes or the sales representative introduction notes.

Sample Introduction Note Templates

Over the years, Primary Intelligence has created many of the three types of introduction notes I described above. We have spent a lot of time and effort in creating notes that will elicit the kind of response we need to be successful. If you would like a template for one of these introduction note types, send me an e-mail with the template you are interested in and Ill send you a sample of what were currently using to help move you along with this best practice.

About the Author: Ken Allred, Founder and CEO of Primary Intelligence, is a thought leader in SaaS-based sales intelligence, analytics and sales enablement solutions. He is committed to the optimization of sales, marketing and product management teams through the implementation of advanced Sales 2.0 intelligence solutions.

I am working with a key client, local to Philly looking for a Marketing Director for DRTV. My client is a VERY stable company and this position is open due to growth! My client is expanding into other countries so international experience would be great, not mandatory.

Marketing Director- DRTV

My client is an energetic group of developers, designers, marketers, media mavens, sales superstars and customer service professionals who work together to create innovative software products. Their consumer products and services are used by hundreds of thousands of people and businesses, with registered customers in 55 countries

They are a profitable and growing software company based in Philadelphia, currently searching for a DRTV Marketing Director to lead the company’s TV marketing and planning efforts, and partner with all departments to increase the bottom line.

If you value innovation, open-mindedness, adaptability, and continual professional growth, a career this company may be right for you. The position offers the opportunity to challenge and develop your skills in a team oriented environment where your drive, creativity and innovation will be measured and felt each day.

This is a fast-paced role in a quickly growing, high potential company. A successful candidate will demonstrate a deep knowledge and understanding of DRTV as well as the challenges involved in program analytics, strategies, communications and project leadership of DRTV initiatives. The Marketing Director will be responsible for data and insight driven decisions, resulting in increased growth. This role requires strong experience with consumer insight and data analysis; competitive intelligence; distribution channel economics; concept development; and a working knowledge of traditional media and internet marketing. A successful candidate will have a proven track record in analytics, strategic thought, time management and a high proficiency in both written and verbal communication.

Responsibilities:

•         Implement and manage general or segment-specific DRTV marketing strategies both domestically and internationally

•         Create/execute marketing plan, including: setting goals, developing creative, designing list/lead strategy, developing operational tactics, close coordination with other critical channels like email and Web

•         Understand  and use media buying cycle to improve ROI

•         Participate in the development of financial and consumer models to inform program development and evaluation.

•         Continuously re-engineer marketing process to optimize performance of campaigns, and their integration with other channels like Web and email.

•         Ideation and execution of additional tactics to further develop ROI.

Qualifications

•         8+ years of relevant marketing experience with a strong analytical/financial background

•         A demonstrated knowledge and understanding of DRTV

•         Motivation, creativity and desire to work in a fast-paced environment

•         Strong understanding of direct marketing creative development

•         Timely, fact based decision making oriented on team input, data analysis, anticipation of market conditions and consumer behavior.

My client offers a  competitive base salary and incentive package, medical/dental insurance, life/disability insurance, 401k, a great working atmosphere and an encouraging environment of professional development. Free parking and also convenient to public transportation.

If you are interested in this position and meet the requirements, please feel free to send your resume to Hal at h.shapiro@thebossgroup.com

iGoogle allows users to create landing pages for just about anything Google has created an app for and more.  One of the things I use it for is to quickly monitor news about competitors and clients.  And because this is Google, it’s all free.

Basic how-to:

Go to the iGoogle page and if this is your first visit to iGoogle you will see a big button that says, “Look for new stuff to add” which will take you to page full of gadgets you can easily insert into your iGoogle page.  There is also a search button that allows you to find things to add to your page.

Next, search on “alerts” and this will bring up a Google news box that you can customize and add to your page. 

Now you face a question: do you want to load all these news alerts to your one iGoogle tab or create specific tabs for specific activities?  I chose the latter approach and have created a tab called, “Top ten clients.”   To create a tab you open the down arrow to the right of your “Home” label and click on last pull down item, “add a tab.”

A box will come up and you can give this tab any name you want.  It will then save it as a link below your iGoogle home tab.  You can open this tab and start setting up custom Google news searches on your top clients.  The results will display on this page under a label for each client (you create the label) and Google news will stream its most recent news for these clients.  You can display anywhere from 1 to 9 items.  It defaults at three and I chose to see five.  I find it a lot easier to monitor news at a glance rather than have alerts come to my email where I have to open them up individually and scan through them.

Tip:  don’t just follow these instructions.  Play around with iGoogle yourself and I’ll bet you quickly will find uses that work better for you or can improve this approach.  iGoogle is not only very powerful but also lots of fun.

Remember:  I will be speaking about competitive intelligence for law firms in San Francisco tomorrow.

Here is another article about the dangers of social networking for companies.   The article’s recommendation is “be careful” and I think that’s insufficient.  Training, training, training, I believe is the key to a successful corporate approach to handling employees use of social networking.

The article starts out discussing a more interesting issue which is utilizing social networking for competitive intelligence.  They use LinkedIn as an example and warn about the dangers of allowing people access to your network.  The first point is that for a corporation, this could be like handing over a client list to a competitor.  The second point is that this list is great competitive intelligence as it could show an outsider who the key people are in a particular industry and how your company connects to them.

Point one:  There are good reasons to keep your network private based on who you are and what you do.  As an attorney, clients might not want other people to know about the relationship so that is a critical issue.  If you work for Microsoft, you may not want your bosses to know that you just accepted a Google HR recruiter to your network.  Or maybe you do.  But there are downsides to privacy.  Restricting access to your network deprives you some of the benefits of reaching out to others based on who you know. 

Point two:  LinkedIn is a great tool for competitive intelligence, learning about who knows who and how they know them.  This can be great information for a meeting.  You can ask with some confidence if the person you are meeting with knows someone else in their network that you know.

Twitter is also a great tool for competitive intelligence.  In face by utilizing the Twitter’s advance search, its possible to refine a search and get very real time information.  For example, I did a search on various law firms and found that an attorney at Wilson Sonsini tweeted about his being made partner before the firm had made the announcement public.  Typically, firms like to control these kinds of announcements carefully so this might be exploitable intelligence.  Who might have been overlooked?  What else might this person tweet about that could be revealing?

By the way, I will be speaking about competitive intelligence for law firms in San Francisco on Tuesday.

What?

According to a study by the Society of Competitive Intelligence Professionals, about 90% of the Fortune 500 companies in the US are conducting competitive intelligence activities. A majority of large enterprises, according to another study (about 70%), believe that having competitive intelligence in the past would have increased the effectiveness of their campaigns. Yet, many companies, including some market leaders in the rest of the world, do not have well-defined competitive intelligence plans. They evaluate their strategies and tactics in isolation, without taking into account what the competitors are up to or how they could react to them. 

Competitive intelligence is one of the key success factors in today’s highly competitive and dynamic marketplace. Companies need to continuously monitor their competitors, especially before making key strategic decisions and investments around new product and campaign design, price and promotions plans, and branding and repositioning decisions. 

But, Why? 

If not proactively managed, one of your competitors may launch a similar product to the one your R&D Department was working on just before you. Another competitor may apply deep discounts the same week you were planning to increase your prices. Any such actions by your competitors can and will go a long way towards negatively affecting your market share and brand image.

To address such risks, companies need to take into account not only their own strategic priorities and voice of their customers, but also what their competitors plan, develop and offer to the market, in order to have the complete picture for their strategic and tactical investments. This is why, according to the respondents of a recent Outward Insights survey: 

• 83% consider competitor intelligence important in business development & sales
• 79% consider competitor intelligence important new product launches
• 71% consider competitor intelligence important R&D planning and execution

Unfortunately, most companies that do competitor research perform such activities only on an ad-hoc basis and do not follow a structured process or plan. What’s worse, such research often gets lost on the desktop of a few specialists and never sees daylight again. Effective competitive intelligence with high ROI requires the right focus and utilization, which comes with good planning and dedication.

So, How?

The obvious, but not so commonly covered, first step in competitive intelligence is the identification of competitors. Unfortunately, most companies assume only their usual rivals create competitive risks and fail to recognize a potential up-and-comer, or a complete newcomer until it is too late. For example, Xerox failed to recognize Canon as a potential threat before it entered into its market and US car makers considered Honda as only a motorcycle manufacturer and did not consider it as a future competitor at the time. Identification of the competitors requires ability to foresee who might enter into the market, as well as who has substitute offerings stealing market share from them, such as a speedboat company stealing customers from Ford, or 3G mobile operators stealing share from the traditional ISP market. 

Once the current and potential competitor list is defined, companies should set-up operations to regularly follow news and continuously gather intelligence about their:

Although information about all these items should be collected continuously to facilitate quick responses and opportunistic actions, regular reports should also be compiled quarterly or semi-annually to create an archive on the competitor profiles, to use as an input in the strategic planning and key initiatives such as new product launches. 

Sources which can be used to gather such information are numerous, with different levels of cost (difficulty), content, and depth:

All the information collected about competitors should be action oriented, creating immediate responses upon learning or critical inputs for decisions in the future. Hence, companies should also pay attention to measuring and evaluating the value-add of each source and category of information collected to maximize return on their competitive intelligence investments.

What Next?

In order to start structuring and regularizing competitive intelligence, companies should establish an external or outsourced team of specialists or allocate part-time responsibilities to their existing resources to initiate and plan intelligence gathering activities. In this plan, the sources, content and frequency for intelligence gathering should be well-defined and supported by a knowledge management platform to keep the information manageable and accessible by the right parties over time.

To learn more about gathering competitor intelligence and how we can help, please contact info@forteconsultancy.com.

Yesterday, I received an email from a Managing Director of a company professing to be a “firm specializing in recruiting and competitive intelligence research”. An interesting combination, I thought. They claimed that their goal was “to empower organization’s decision making processes through the use of high quality, targeted competitive intelligence”. The use of competitive intelligence amongst large multinationals (like the one I used to work for) was nothing new, so my interest began to fade. The email went on to state that this firm had “compiled individual contact information including name, title, department and direct phone and e-mail addresses for employees of [certain organizations] and that this exercise had facilitated a very detailed divisional and departmental structure and analysis of [these organizations]”. The organization, about which information was being offered up for sale, was a large multi-national and household name in almost every country in the World. Okay, now I was alert, curious about where this email was heading. I read on. The firm’s MD proudly declared in his email, that this data could play a significant role in helping international firms understand the inner workings and structure of one of the world’s most respected and innovative companies. And then came the pitch: They were looking to partner with someone who is well connected in specific markets that could help them market the so-called “valuable data”. Ugh! How could someone go around selling details of the senior management of a global icon to their competitors? It was a bit too quirky for me to digest – perhaps I get queasy too easy!

A quick visit to this firm’s website and I was even more astonished when I read their offer to buy contact lists off people – yes, they want your rolodex! And they were offering to pay handsomely for it too! The justification for this entire business model (a pretty simple one at that I must confess) is that the firm was offering corporate customers (through its business partners) direct access to senior management in organizations by-passing the gatekeepers in these organizations. Alright, let’s take a moment to pause here. This firm is offering to buy my rolodex to offer it to other companies so that the purchasing company can have direct access to the contacts in my rolodex?

Isn’t there anything called ethics anymore? I mean, where does someone get off compiling information about an organization’s employees, and then selling it to another company? Doing this through public information sources, namely professional bodies or licensing organizations is subject to information filtering, registration and identity verification, and therefore is probably plausible. But the thought that there are organizations out there, offering to buy your list of contacts and their details and then market compiled datasheets to interested parties, sounds creepy to me. Is it just too much, this data mining thing that has caught marketing forces by storm and spiraled out of control?

Why did I get this email then? Perhaps it’s because my consultancy business is related to assisting organizations, some of whom are multinationals, NGOs and Government Departments, the “rolodex traders” were interested in gaining access to my network. Just then, another thought struck me: Hey, could this actually be some smart aleck fraudster trying to gain access to my list of contacts – for free??!! Perhaps these bozos are not interested in me marketing data that they bought, but were more keen on getting their hands on my own network. Geez, there’s sucker born every day huh? I mean, what if the recession blues had tempted me, or I had felt a wee bit rebellious and as a plain ol’ risk taker had the “Oh what the heck” attitude….I guess I would have then been yet another statistic on a security bulletin. Perhaps those contacts in that security bulletin are also up for sale in a dark alley somewhere! Meanwhile, my rolodex is under lock and key hopefully secure from the tentacles of the Rolodex Raiders!

To piggyback on my last blog about The Need for Competitive Profiles: It’s Not a Competitive Intelligence Staple; we had discussed as part of the profile a product or service matrix. A competitive matrix is a quick guide/reference or cheat sheet if you will to compare your products or services versus your competitor’s products or services.

This is an invaluable tool for any business regardless of size. One way to set up your matrix is by creating a spreadsheet listing your products/services next to your competitor’s products/services. An example of what your matrix should include are your products/services and the benefits of each.

It is not recommended to handout to customers:

1. It can get into the hands of your competitors

2. The time/effort/money spent to comprise a matrix is not for the benefit of your competitors

3. It may show your competition as having better products/services

There is no right or wrong answer as to how to set it up or what information should/should not be included. The matrix is for the benefit of the company and its employees.

Daryl Scott & Marcy Phelps

This time last week I was at Internet Librarian in Monterey, California. AttaainCI earned AIIP’s technology award. Founder and President, Daryl Scott was present to receive the award from AIIP’s President, Marcy Phelps. Every year, the AIIP Technology Award is presented to a company whose product, in the panel’s opinion, best assists independent information professionals in locating, analyzing, organizing and delivering information.

AttaainCI software, was launched in early 2008, and provides real-time intelligence gathering, analysis, sharing and reporting alerts. One of my favorite uses is company tracking: your company, one you want to acquire or a competitor, for example. Track what’s being said about your company’s products or your key customers. It is reasonably priced at $149 per month for the first user and $69 for the second user for unlimited usage on a month-to-month basis. Discounted annual plans are negotiable with Attaain. Watch 10 instructional videos and learn in detail how AttaainCI will work for you.

AttaainCI continuously monitors, filters and integrates intelligence from a wide range of sources.

The software had its start mostly tracking social networks such as Facebook, Twitter, LinkedIn among others.  Recently AttaainCI included Hoovers as a resource for information, greatly boosting its one-stop shopping appeal for research. You can use it both for a one-time research project, for example a company or person; and you can receive email alerts delivered to your mailbox according to a personalized schedule. It is cooperative in that you can share results with co-workers and view results more visually.

The typical output for a one-time company research query might be 3 or 4 pages of data that is easy to scroll through, as the abstracts appear neatly in 4 columns: Search Results, News & Announcement, Blog Mentions and Additional Intelligence. You can quickly connect to the best articles or reports to get up to speed on the topic you’re researching. You can also find out who is talking about that topic through your social networks. I find it is useful since I have a huge LinkedIn network, so I always find relevant people to follow-up with. Similarly I often can connect to good people on Twitter, who lead me to others once I determine the # for the topic in question, like #eldercare.  If you need more information than what is on those several pages, AttaainCI provides links to even more data right off the initial report.

AttaainCI is a good software package to get up to speed on just about any topic, and it’s great to use at the outset of a project whether it’s competitive intelligence or general research for sales, marketing, product management or strategic planning. AttaainCI is an effective tool for daily monitoring on topics to get the latest and greatest while you’re working on a project, which goes on for two weeks to a month, for example. Find out what people are saying about you, key executives, your products, and your company through AttaainCI.  AttaainCI will greatly reduce your communication time for intelligence deliverables.

Security is the top IT priority for small and medium-sized businesses. Really? That somewhat surprising finding comes from a survey issued today by SWC Technology Partners, an IT services provider that focuses on smaller companies.

According to SWC, which is based in Oak Brook, Ill., 55 percent of the 170 IT decision-makers surveyed called security projects a high priority, good for first place. Business intelligence, which has taken the top spot in many such surveys over the past couple of years, ranked second, with 38 percent calling it highly important. Storage, web development and LAN/WAN infrastructure followed.

Security is often one of the areas hardest hit by contracting budgets, since it can be difficult to demonstrate return on investment. Observers and analysts have been fretting that the current recession would end up having some nasty effects on corporate IT security, particularly at smaller companies.

SWC’s results say otherwise. Of course, this is one isolated survey, which SWC conducted itself rather than using an independent research firm. Still, the participating IT leaders, which include both SWC customers and general contacts, hail from a cross-section of industries manufacturing, retail, education, construction, healthcare, accounting and non-profits. And while the mid-market companies represented were mainly in Illinois, Wisconsin and Indiana, Elliott Baretz, director of business development, said that the numbers likely play out nationally to some degree.

Baretz told me that he was also surprised that security ranked so highly. “I’m with customers every day, and most of my conversations are not about security,” he said. Unless the client has a specific security issue or a compliance concern, the subject doesn’t often come up.

There are a couple of ways to look at the finding, according to Baretz. One is that when you present people with a list of areas to rank, they might consider it irresponsible not to call security a high priority. “Does it mean that’s where I spend my next dollar? Probably not,” he said.

On the other hand, the survey could be viewed as coming at the end of the recession, and IT leaders who have had to put security on the back burner are now feeling vulnerable. Where companies have been cutting back on IT security investments, said Baretz, they might now realize that they have to bump up spending to stay safe.

What about areas where it’s easier to justify investment? Of the respondents, 41 percent named virtualization as technology with high ROI justification. “Virtualization has become a widely adopted and accepted platform to consolidate and manage server infrastructure, thereby reducing costs associated with hardware acquisition and management as well as reducing the physical footprint of the server room itself,” said SWC in a statement. Collaboration tools and Web development ranked second and third, respectively, in terms of cost justification.

Looking ahead, 51 percent of the IT leaders said they are “cautiously optimistic” about their business outlook over the next year. Eight percent said they are pessimistic and another 3 percent said they are highly pessimistic.

SWC, which has partnerships with Microsoft, Cisco, HP and Symantec, had $15 million in revenues last year. More than half of the IT decision-makers the company surveyed manage environments with between 100 and 2,000 users.

CIOZONE