News flash… decisions by business customers are increasingly driven by the same dynamics of peer-to-peer networks and opinions that influence consumers (e.g. Yelp, Trip Advisor…). Facebook sports a $380 billion value, in part, because of the power of the like button to influence purchases by consumers.
Businesses spend $3 trillion a year on enterprise technology. Enterprise technology companies know that the “white papers” they publish lack independence, and thus score low in terms of buying consideration. Buyers are looking for content that combines expertise with an independent voice. That’s why “peer recommendations are influencing more than 90% of all B2B buying decisions” according to a recent HBR article. A Gartner study found that peer networks, like IT Central Station are the dominant way that buyers are getting input from other end users:
The enterprise tech purchase path has three phases
- Exploration — do I want to make a change?
- Evaluation — what approach am I going use to make to this change?
- Engagement — can I work with this specific vendor?
According to Gartner, during the second and third phases of the buying process, recommendations from analysts and influencers, including peer reviews, is the most important factor driving the buying decision.
IT Central Station, lead by the talented Russell Rothstein, is using the power of peer reviews in enterprise tech to build a big business. For example, here’s a review of AppDynamics APM (Application Performance Management).
It All Starts With The Users & Monthly Uniques Are Growing Rapidly
As IT Central Station is a private company, for competitive reasons, we won’t disclose exact figures, but total visitors to IT Central Station grew 52% in 2016 vs. 2015:
User growth accelerated to 60% in January 2017 over the previous January, driven by 66% growth in organic search, as Google increasingly appreciates the value of IT Central Station’s peer reviews. This enables IT Central Station content to consistently rank at or near the top of organic search results for a large range of enterprise IT products:
Example of ITCS Appearing at the top of a Google Search (out of 918,000 results)
Example of ITCS Appearing at the top of a Google Search (out of 431,000 results)
The reason the users are coming to IT Central Station is to read in-depth reviews. While the main competitors have reviews that are 50 words long on average (Spiceworks) or 100 words on average (G2 Crowd), IT Central Station reviews are over 400 words on average, solidifying its position as the place to go to read in-depth peer reviews of enterprise tech products
Syndication of Content is Adding to IT Central Station’s Reach
IT Central Station has a growing list of distribution agreements with many of the leading technology publications.
Here is a sample of IT Central Station reviews on CDW, the largest reseller in the IT industry at $17 billion in annual sales.
IT Central Station also distributes its product reviews on leading tech media sites including CIO.com, Computerworld, and InfoWorld.
Finally, in October, in another confirmation of the value of IT Central Station’s peer reviews, IT Central Station was featured in LinkedIn’s announcement that “LinkedIn Introduces B2B Product and Service Reviews Into the Feed”.
Each of these partnerships adds significant reach to IT Central Station, enhancing it’s ability to reach the decision makers buying $3 trillion worth of enterprise technology every year.
Monetization Is Growing Even Faster Than User Growth
Given the dramatic impact that peer reviews have on buying decisions, it’s no surprise that IT Central Station has a blue chip roster of enterprise IT clients:
Partial List of IT Central Station Clients
Clients love IT Central Station reviews:
AppDynamics: “Our largest deal of the year was a result of our investment in IT Central Station.”Oracle: ““IT Central Station was ranked #1 when we asked leading members of the Oracle IT community which peer-to-peer technology review sites they were most aware of.”
As a result of their strong relationship with their customers, IT Central Station revenue grew 90% in 2016, driven by a 52% increase in users, and a 25% increase in the revenue per user.
Revenue per customer grew 150% from January 2015 to January 2016 driven by the increase in reach, as well as the introduction of new products, most notably, the introduction of video reviews. Here’s a video review of HPE’s 3Par Flash Storage.
IT Central Stations’ revenue should continue to climb in 2017 and beyond as IT Central Station continues to grow its reach, grow its customer base, and add new products.
Future Opportunities For Growth Are Significant
At its core, IT Central Station has built a sophisticated buyer intent database and engine built upon big data technology. IT Central Station tracks the behavior of enterprise buyers on its platform and assigns a buyer intent score, aggregating that data across other visitors from the same organization. As a result, IT Central Station knows which enterprises are currently in a buying process, which vendors they are evaluating, length of the buying process, seniority of the people involved in the process, and other valuable buyer data. Today, IT Central Station monetizes that information by enabling its clients to market to its users leveraging the intent. There is a big opportunity for IT Central Station to better leverage that information, potentially even creating its own marketplace. While that path is unchartered at the moment, what is clear is that when you have a large and growing amount of buyer intent information in a $3 trillion market, the opportunities are significant.