When I set out to develop the content for the OSBC panel "Marketing to Dilbert: Marketing Methodologies for the Open Source Crowd" I was fairly certain that something would get lost in translation. The topic itself is just so broad that I tried to refine it to what I considered the most important aspects. Therefore I focused on market research, communicating with developers and learning from other marketers. The thing I think most people continue to forget is that marketing is much more than brochures and websites. It's also pricing, brand positioning, communications and more.
In the presentation, the slide that I thought could easily make me less friends was the one about what companies are doing a good job and what companies are close but not really succeeding. Oddly there wasn't much disagreement from the audience though at least one person misconstrued something I said.
Who's doing a good job
RedHat
MySQL
SugarCRM
Decent branding, but not great marketers
Sun
JBoss
Novell
I think the companies who are doing a good job are fairly self-explanatory. RedHat has a virtual monopoly on Linux deployments, MySQL has a model community relationship, and SugarCRM has been unbelievably smart about their business model and how they interact with both customers and developers. You can also look at the pricing and branding strategies to see that they have all done well for themselves.
Let me clarify what I mean in the "decent branding but not great marketers" category. None of these companies are necessarily bad-in fact I like all of them, but they are all off in one area or another. With Sun, the struggle is transitioning from a generic strategy of differentiation (high-end specialized products) to one of cost-leadership (new machines that compete with commodity Intel boxes running Linux.) It's not easy to swing a ship that big, but there continue to be signs that things are going in the right direction. But they aren't there yet, hence my dubious trust of their marketing.
Let's take the oft-cited 4 Ps of marketing (Product, Price, Place (distribution channels), Promotion) and apply them to Sun to see what happens. For the sake of this exercise we'll simplify using a high, medium or low rating. I will also throw in the notion of Community as the wildcard.
Sun Microsystems (SUNW)
Product: High
Sun makes quality products.
Price: Medium
Sun offers good low-end products at decent prices. However, Sun has traditionally based their strategy on differentiation, not being a low-cost provider. While its clear that they need to get into different markets (SMB, high-density data center etc.) this low-end pricing causes confusion as the perception is that Sun makes high-end systems with a high-end price tag.
Place: High
Sun's product distribution is excellent. Realistically, every open source company should get a high mark here since distribution is basically free on the internet.
Promotion: Low
This is where I feel that there is a great deal of confusion and mixed messages. Just a year ago Sun was basically against Linux-I would even say that the perception was that Sun was an enemy of Linux. Now they cite statistics of new servers running Linux.
Add to this the acquisition of StorageTek, which does not lean toward the open source future that Sun keeps talking about (though buying revenue and cash was not necessarily a bad thing.) Then take into account the purchase of SeeBeyond, which makes more sense but still doesn't tell a clear story.
Community: High
Sun is really exemplary in community building and maintenance especially in relation to Java. What I said was that I found it hard to trust Sun because there is no clearly visible strategy. I find it disappointing that Sun didn't embrace Linux, but I get why they stuck with Solaris. That said, they have pioneered the majority of the community models we see today.
You should be doing this stuff if you are in marketing
This is an extremely basic example of a marketing analysis. The point is that if you are running a company of any kind you should be looking at your competitors and figuring out their weak spots. With Sun, the weak spot is the flip-flop on Linux and the fact that it's an enormous organization that is responsible to shareholders. The fact that they have been good to the community that uses their products is admirable.
Previously:
Does free software necessarily lead to support revenues? (Jonathan Schwartz)
Sun's Grid Flop
E-trade on Open Source
Posted by Dave Rosenberg on February 26, 2006 02:01 PM
