A Glimpse into the Regional Differences of the Tech Purchase Process
By: Foundry | 2/24/2021
Technology innovation and dependence have seen steady growth in recent years, but 2020 took it all to new heights. Organizations across the globe have been required to react to the unprecedented demands of the past calendar year quickly and creatively. IDG’s 2020 Role & Influence of the Technology Decision-Maker Research highlights the influence that IT decision-makers (ITDMs) play in this changing landscape, as well as how the IT purchase process has changed due to the pandemic. With different areas of the world reacting in different ways, a comparison of APAC, EMEA and North America’s (NA) response is in order to better understand their 2021 initiatives and priorities.
In some areas, the three have a nearly identical outlook – only a three-percentage point difference in the likelihood to consider new vendors when making quick purchase decisions. In others, the regions could not be further apart – a difference of nearly 20 percentage points can be found when comparing the expectation of change in IT budgets over the next 12 months. Explore a few key comparisons and download the regional specific report(s) for the full story below.
Expected Shift of IT Budgets
Describing the last 10 months as “hitting a rough patch” would be an understatement. Initially, to soften the unexpected impact, organizations highly monitored cost control and expense management, reducing spending in some “non-essential” areas. As organizations continue to realize the business value of technology solutions and their necessity to keep the business moving forward during this time, IT budgets are beginning to rebound. All regions expect their tech budgets to do well in the coming year, but EMEA’s recovery is coming quicker – 82% of EMEA budgets are expected to increase or remain the same over the next 12 months, compared to only 75% and 63% of NA and APAC budgets, respectively.
What Types of Tech Purchases are Being Made?
Work from home initiatives have pushed many companies to expedite their digital transformation. Technologies such as security, cloud, and collaboration tools are heavily relied upon and sought after by almost all organizations – a silver lining for the tech industry. The follow up question becomes what types of tech purchases are in the works? Whether they be upgrades, replacements, or additions to the tech stack. Consistently at the top was ‘additional tech purchases planning to be made regardless of recent events’ (35% NA; 34 APAC; 32% EMEA), followed by ‘upgrades to existing tech’ (28% NA; 26% APAC; 27% EMEA).
When asked about their likelihood to consider a new tech vendor when making quick purchase decisions, 54% and 51% of EMEA and APAC tech buyers would consider a new vendor over an incumbent, respectively. NA organizations are more cautious, considering a new vendor only 36% of the time. The motives behind seeking a new vendor include current product/service no longer meets the business’ needs (49% NA; 36% EMEA). The top factor for APAC companies is the increased cost/level of investment required by the current vendor (44% APAC), which is the #3 reason for both NA and EMEA.
Leadership Throughout the Tech Purchase Process
So, are there regional differences on who leads the tech purchase process? At nearly every stage of the APAC purchase process, the CIO takes control of the operation, supplemented by aid other tech specific roles (i.e., IT management, CTO). In the EMEA and NA processes, the CIO maintains control; however, opinions from outside departments are more likely to be taken into consideration, such is the case with CFO authorizing or approving the purchase of products and services.
Thinking about how vendor short lists are created for technology projects, 44% of EMEA ITDMs say that LOB will bring the shortlist to IT for vetting before a decision is made, and 42% say that IT will research the solution and create the short list. This changes for APAC tech buyers as 68% say that IT will research solutions and vendors and create the short list, with only 18% saying that LOB will bring a short list to IT for vetting before a decision is made.
Sources Relied Upon
Across the globe, forms of communication and interaction changed significantly from 2019 through 2020. Looking at the information sources that ITDMs rely upon throughout the tech purchase process, there are certainly some regional differences. In EMEA organizations, the top sources are as follows: 1) tech content sites, 2) tech vendors (phone, email), 3) tech vendors (in person), 4) analyst firms, 5) peers outside your company (phone, email). Comparatively, APAC organizations source their info from a more diverse background: 1) executive conferences/events, 2) analyst firms, 3) tech vendors (in person), 4) webcasts/webinars, 5) peers outside your company (phone, email).
Along with content types and sources, tech marketers must also be aware of the factors that increase ITDMs’ trust in online information. For all three regions, the best way to increase trust is through peer recommendations (70% APAC; 65% NA; 54% EMEA) and looking to properly sourced testimonials and/or case studies (63% APAC; 60% NA; 41% EMEA).
For more insight into the role of the technology decision-maker and tech purchase process in the EMEA market, download the regional specific white paper.