Climb up the vertical ladder
Western European IT spending is rising, so targeting certain markets will pay off, research claims
Western European IT spending will gradually improve in 2004 and suppliers should target specific verticals with products and services as the market evolves, according to research from IDC.
The analyst's Western European IT Vertical Market Spending Forecast revealed vendors should see 2004 as a 'transition year' with different verticals setting different targets for IT.
Giuliana Folco, research director European vertical markets at IDC, said verticals such as manufacturing are focused on cost-cutting, while banking takes a more strategic view.
"Building up specific value propositions to target different verticals is a key requirement for IT vendors that intend to capitalise on opportunities offered by this transition," Folco said.
Gordon Davies, commercial director at reseller Compusys, agreed that the finance and public sectors are lucrative areas of demand.
"I would include the SME, which I classify as a vertical because you take a different approach to it," he said. "All of our customers are investing again. I would hesitantly say we are on the crest of a wave."
Davies added that the combination of customers moving to mobile working and the upgrade of machines bought before 2000 are key drivers.
Contrary to IDC's view, he does not think businesses are buying IT to cut costs. "None of our customers are doing this any more. They are investing for growth," he said. "Vendors are already offering vertical-specific products and services."
Eurodata Systems sells into the legal and media sectors and has a significant presence in the finance and public-sector markets. Des Lekerman, managing director of the VAR, said specialised resellers will win more business.
"Those that focus on certain technology and market areas will do better than those that try to be everything to everyone. This doesn't work any more," he said.
"It isn't just about cutting costs but investing in making processes more efficient, as well as gaining competitive advantage."