"I remember when..."

April 30 2009

In comments on yesterday's "Doing things different" post, Clayton Price wrote:

Personally I feel for Lotus. I remember attending Lotus Fusion (Gold Coast, Australia) a good few years ago where there seemed to be approx 1000 attendees. Now each Lotus event I go to is lucky to have a 100 people. The growth in the seats is a little surprising for me to be honest!
This actually turns out to be one of the most important realizations one can have in the discussion of what IBM should be doing to market Lotus differently now....now is not then.

I remember that Lotus Fusion in the Gold Coast, too.  It was a watershed event in my life in many ways, at least the first one in 1999.  It was at an awesome resort in a fantastic location, and it might even have been free to attend.  I had never been to Australia before, like many of the other Loti that came over for it.  Lotus was still operating as an independent company inside of IBM, and the money was flowing.  I think this was around when the schwag was getting so silly such that we had "R5" suntan lotion for the beach.  There were hundreds of people at the event (I don't remember 1000, but there were a lot), and of course all the women were beautiful, all the men were smart, and the 20 of us that came over from the US were treated like royalty.  We had TV commercials for R5, a great product story to tell, and lots of people wanting to be part of it all.

I latched on to Clayton's quote because in all of this week's version of the Lotus marketing discussion, it's important to understand how different things are today.  Ten years ago, most companies didn't have a client/server messaging system fully deployed or standardized in their environment.  Y2K was fast approaching and that was driving decisions.  Ten years ago, the market was growing at 30-40% plus per annum, and the growth was mostly what we would call "greenfield" (customers had neither our product nor anyone else's in this category).  Ten years ago, Lotus was given a disproportionately large marketing budget from our IBM parental benefactors, because the market at the time demanded that we aggressively capture installed base or it would go to the competition.  Ten years ago, in the IT market, everyone was going online, and the mere hint of doing some kind of e-commerce or Internet tie-up sent stock prices soaring (remember when K-Tel announced that they would be doing something on the Internet, and their stock went from US$4 to US$34?).  Ten years ago, all sorts of "ankle biter" competitors were going to kill Notes -- e-mail vendors like OpenWave, Critical Path, Bynari, Gordano, and collaboration vendors like Zaplets, First Class, and of course the Internet itself.

Ten years ago, it took a lot of humans to install, deploy, and manage Notes and Domino, with a typical server load being around 400 users per server.  Today I talk to companies that have 500 Notes users and no full-time resource allocated to it.  That certainly kills any shot of having a strong internal advocate.  The market growth rate has slowed to single digits, and most of that growth comes in emerging markets.  Few companies are deploying their first-ever corporate e-mail system today, and e-mail is no longer a strategic imperative -- now it's a corporate communications tool.

It is pretty challenging to operate the Notes/Domino business today when compared to that past.  Today, as part of a business unit within IBM, my team and I have to make decisions about Notes/Domino that meet our corporate objectives -- profitability, linked value, customer commitment, globalization.  Companies using Notes today are more likely looking at how to save money on its operation than expand their budget.  Collaboration is a hot buzzword, again and still, but there are many forms of collaboration tools available today, with Notes/Domino usually being a component of an overall IT infrastructure rather than the only piece of it.

Ironically, some of those who are the loudest voices about IBM's need to do something different may have missed precisely how different this marketplace is from when they first got into Notes, many years ago.  I'm not sure I'm in total agreement with Nathan's follow-up where he claims that Lotus is now and again a consumer brand, but clearly the way the game is played has changed.  The expectations of many who comment are set based on the high bar established ten years ago, when the market was growing like crazy and everybody in IT was successful.  Today is a different era, where Notes/Domino has a huge installed base and, as you see with our competitors in Redmond, the main competitive activity is going after the other guy's installed base through merger/acquisition/consolidation/cost savings.  By the way, all of those activities tend to further lead to changes in the way IT staff work with these products, so it changes the internal advocacy dynamics as well.

Going back to Clayton, I've spoken now to almost 3000 Notes/Domino customers and business partners personally in the first four months of 2009 -- from Lotusphere to Munich, Dusseldorf, Hamburg, Chicago, Nashville, Copenhagen, Brussels, Toronto, Columbus, Indianapolis, Boston, New York, MacWorld SF, and Lotusphere Online.  People are turning out for these events.  Paris's LCTY was 500 people -- and that was after the IBMers were told to stay away to make room for clients.  Tokyo set a record.  Half the ones in the US had to be moved to bigger venues.  There is continued, and in some areas resurgent, interest in Notes/Domino and the rest of the Lotus portfolio.  And while the brand performance was off a bit in Q1, we continue to see growth in number of active licenses on Notes maintenance and other key indicators.  In all of the discussion of the last few days it is critically important to NOT lose sight of this -- even in a down economy, interest in Lotus ... business activity around Lotus ... continues.  Some of the strongest voices in the partner community tell me they are simply too busy making money to blog or read the blogs.  Our survey data on Notes/Domino 8.x upgrades is tracking well, and we're starting to get the initial reports of 8.5 deployments that cheer about the 40-60% disk space savings and other performance improvements they are seeing.  I point all this out to show that many, many things are going right at the moment.  It's not head-in-the-sand, denial, selective hearing, or anything else -- it's that I choose to see the positive as well as the negative.  

As for that negative, a few may not believe that Lotus is capable of doing things different.  Fine.  We sure have a lot of "different" going on this year.  Notes/Domino 8.5 (with a Macworld launch), Alloy, LotusLive Engage...these are all different.  They are creating opportunity.  They are generating buzz and excitement.  It may not be to the gold standard of 1998-1999, but I suspect nothing ever will be, again.  Not only are the marketing budgets different, the ways to reach decision-makers and influencers are radically different.  So please don't talk to me about Denis Leary anymore.  I loved those commercials.  They're not coming back.  Instead, show me your success stories like Marie Scott did yesterday.  If you are a partner, publish your reference stories and show the world that you are successful in the Notes/Domino market.  If you are a customer, fill out our Notes/Domino 8.x survey, or start planning that upgrade to 8.x.  Explore how Symphony, Sametime, Alloy, LotusLive, Connections or Quickr could add value to your environment.  And yes, watch for more "different" coming out of the Lotus brand.  Because if one thing is certain about the last three days, it is how willing the people behind the brand are to engage in the conversation.

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