Business Editor for the NZ Herald

Kiwi tech companies making marketing mistakes

Photo / Thinkstock
Photo / Thinkstock

New Zealand technology companies are taking an "inefficient spear-fishing approach" to marketing, targeting one customer at a time rather than many, says a new study.

This year's Marketing Measures study says the problem with New Zealand technology companies is not how much they are investing in sales and marketing but how it is being spent.

The annual study, prepared by consultancy Concentrate with marketing and communications firms Swaytech, surveyed 346 local technology companies to try measure how they take their products to global markets.

Over 75 per cent of those involved were exporting offshore.

Those surveyed were, on average, still using a direct sales approach without supporting it with other strategies of building brand awareness.

"Kiwi companies tend to be 'spear fisherman', snaring one customer at a time instead of using 'nets' to efficiently catch larger numbers," the study said.

Technology firms on average spent a third of their yearly income on sales and marketing but less than 4 per cent of them used software to automate this process.

Concentrate managing director Owen Scott said this was a "symptom of a deeper problem" in how these companies were marketing overseas.

"We tend to equip sales people to go out and sell customer by customer, but not back them with marketing programmes that communicate to a target market en-masse, which increases brand awareness and makes the sales person's job easier, Scott said.

While technology firms were investing in social media, websites and online advertising they were not getting the results they wanted in these areas.

This was because these sorts of tools weren't being used in a strategic way, the study said.

"Kiwi firms are investing investing in social media but not really committing effort to it as a real marketing tool. On average, LinkedIn is being used monthly and Twitter once per quarter," it said.

Very few tech firms were measuring the effectiveness of their sales and marketing spend, the study said.

Although there was "no absolute blueprint for technology exporting success", Scott said there were "common ingredients" tied to high growth.

"What characterised these [high growth] companies is a strong understanding of a distinct target market; a tight focus of activity on that market; an aggressive and confident attitude to promoting to that market; and, a willingness to measure the effectiveness of their marketing activities," he said.

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