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Thursday, April 29, 2010

On The Disappearing High Tech Trade Press

The demise of Semiconductor International is a major loss for our industry. Our ability to interact and communicate within the supply chain, network and align around key issues and challenges, and just enjoy this fascinating and rewarding business has been seriously damaged. My best wishes go out to all who lost their jobs at SI and I sincerely wish them the best of luck in their future careers.

From a personal point of view, the Reed announcement also hurt since I have had experience placing ads and editorial in several of the discontinued Reed books over my 25 years experience in high tech advertising. I began in the control components and automation industry and placed many ads in Business Design and Construction, Modern Materials Handling and several other of the Reed books to close.

The Reed closures are part of the long-running contraction of business journalism, especially high tech trade journals. There are many reasons for the pervasive decline of the high tech trade press. It’s been my opinion that the one the top reasons—perhaps the top reason—is the incompetence of marketers and their advertising and PR agencies. Especially in high tech, years of ineffectual and amateur work by marketing professionals—and smooth-talking graphic design houses that bill themselves as agencies--has ruined the tech trade media for the handful of professionals who actually know what they are doing.

There was a time when engineers read and valued trade journal advertising. They read ads, just like editorial, looking for solutions and information that would help them in their jobs. Thousands of trade magazines prospered in hundreds of industries because they met the needs of buyers and specifiers. Trade journal advertising could easily be justified by return on investment, proven through cost-per-leads, surveys, and new customer acquisition. Bingo card leads resulted in sales, and products that claimed to be “faster, better, cheaper,” in trade journal ads could steal market share.

That was, of course, before the Internet emerged as a business medium. The bingo card lead system evaporated. The monopoly of trade journals, trade shows and direct mail over mass customer communications was broken. But awful marketing and misuse of the print ads was a powerful factor in the demise of trade journals, especially high tech.

The Internet came about during the go-go nineties when tech was king, business was good, the stock market rising, and young marketers got in control of some serious budgets. With hype fueling the IPO market, so-called image advertising started dominating the tech-rich trade journals. Ad agencies started pushing consumer advertising concepts to inexperienced and ego-driven marketers because they didn’t need to understand the complexity of engineering buying decisions. Complicated technical arguments became reduced to Unique Selling Propositions, communicated through metaphor, similes and graphic design. Word counts were reduced and charts, graphs, and specs were banned in favor of cleverness and attitude. When business was good, agencies refused to do engineering-ads because they didn’t win awards, attract other clients, and appeal to non-technical business people. Marketers who didn’t really understand their products joined forces with savvy, hard selling ad agencies to dumb-down tech advertising, insulting technical buyers who needed substantive, meaningful information from their trade journals to justify their time. Focus groups became obsolete because technical buyers refused to endorse clever creative concepts that were soft on technical why-to-buys and fat on hipster attitude.

During the nineties, the tech trade journal world exploded. Books like Fast Company and Wired became fat with ads from networking gear, chip companies, embedded stuff, and middleware, and other classic high-high tech. Hot shot Internet start-ups and trendy tech brands like Apple set the standard for marketers and agencies, eliminating the complex "techee" engineering ad from the high tech press. No marketer or agency would ever get caught with a specification chart or performance graph in their ads—it was about brand or positioning or Unique Selling Proposition told through metaphor or wordplay. The recession-proof New Economy was running on all cylinders and everyone was riding the wave of historic stock market highs. The best and brightest marketers gravitated to companies with an IPO track or with large advertising budgets to make a name for themselves touting Proctor and Gamble-like brand management concepts, shouted about with big dumb clever ads that captured a position, a mood, or attitude (but not a rational, well reasoned technical argument supported with facts for buying a product). Times were good for agencies and marketers in high tech--you could make good money without knowing anything about technology.

Of course, the dot com bubble burst, scorching the tech advertising landscape like a nuclear winter. Without any rational justification for soft image advertising—without any metrics or case studies of success--the floor dropped out of the print advertising medium. There were no more sophisticated faster-better-cheaper advertising left. Techee ads for engineers by engineers were drummed out of the business. Trade journal readers stopped looking at ads as a source of useful information. Real buyers stopped renewing their subscriptions. An entire generation of marketers and agencies never learned how to use print advertising wisely, spending their time lamenting the emergence of the Internet and hustling their inappropriate, outdated dot-com or consumer creative concepts to the few remaining big egos left with an ad budget. Gen x graphic artists with community college degrees are still calling the creative shots at supposed high tech agencies. The vast majority of people responsible for marketing and selling of products to engineers have moved on from trade journals. See ya, it was good knowing you, fun while it lasted.

From my perspective (without any statistics, just observations)--as part of the fall out from the dot com damaged, tech marketing collapse--high tech B2B marketing seems to have evolved into two career paths: product marketers who manage BOMs and perform project scheduling and management functions; and marketing communications who are younger, lower level positions responsible for web, PR and collateral work. Both paths find it real hard to jump to the VP level and have a big impact on their organizations. VPs of sales and marketing invariably rise up from the sales ranks, further diminishing the role of classic marketing on the high tech industry. The result is a withering of marketing’s influence in high tech industries, further diminishing the role of the high tech press.

The more profound impact, however, on the decline in marketing in high tech has been a rise in product commoditization, killing margins, killing profits and fueling merger and acquisition activity. Commodities emerge from the inability to meaningfully differentiate a product and that’s what marketing is really all about, not big, soft, dumb brand advertising.

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