• Subject: Education- IBM Spin Doctors on AS/400 Marketing
  • From: Glenn Ericson <Glenn-Ericson@xxxxxxx>
  • Date: Mon, 27 Oct 1997 11:40:50 -0500

I did  not personnaly see the TV news clips  but some friends tell me that
Lou G.  was  filmed  giving $10Million  in  equipment to the NY schools
system for student use/education. He  was with NYC  schools chancelor Rudy
If I  had my guess there were no AS/400s  but lots of OCs<??>


At 06:39 PM 10/26/97 +0000, you wrote:
>>Well, the bitch was that we disagreed with the way the money was spent. 
>>situation has not changed.  As an AS/400 professional, I still have to
>>_SEARCH_ for any advertising related to the /400.  The ads that I
>remember in
>>1980 attracted my attention even though I _WASN'T_ an AS/400 professional.
>> "Computer Geeks" don't buy AS/400's, Management does.  If management
>>familiar with the box, management buys what they learned in school (HP/9K,
>>DEC, or Tandem).
>Bullshit. "I want a new GL/AP system, buy me that HP I learned about in
>No freaking way. 
>Customers care about their own business. I just can't picture a VP of
>Finance calling the MIS department and saying, "Hey, I just saw a great
>advertisement for an AS/400. Is there some way we can get one of those to
>do accounting with?" 
>People buy solutions. Hardware is only the solution if the problem was
>This is the whole point of the direction IBM is taking with the AS/400. It
>is an opportunity for the AS/400 to be a solution for other people's
>Right now, buying an AS/400 solution is a whole package,
>hardware/OS/software. When you advertise an AS/400 to someone, you can't
>sell it to them, you can only build brand name recognition (which is
>important). If you want to sell the AS/400 to them, you have to sell them
>a software solution first. Management will not sit through a demo of how
>wonderful AS/400s are, but they will spend several days demoing how
>wonderful a software package fits their business. If this sells them, they
>aren't really too concerned about the hardware (but that doesn't mean it
>is completely unimportant).
>>Yes, IBM is performing.  The problem is, nobody but "us chickens" knows
>>it.  I agree with the earlier comments about getting college students
>>about IBM.  Given their current problems, Apple probably wouldn't be in
>>business today had they not indoctrinated a legion of youth into their
>>systems by giveaways to school systems.  IBM should do the same, IMHO.
>IBM still does giveaways. http://www.ibm.com/IBM/ibmgives/ is the web page
>about IBM's philanthropy. I haven't really read it, so I can't give you
>much info on it.
>But the issue is really: What should IBM give to schools? 
>We, as AS/400 professionals, feel like this should be AS/400s. Believe me,
>I would LOVE to find that IBM was supplying AS/400s and support to
>secondary and higher education. I would volunteer some of my time to
>assist in supporting schools in my area to help implement and keep these
>machines mainstream. 
>But is that a waste of money for IBM? Does IBM make more if you are buying
>AS/400s than if you are buying IBM PC based servers? Is it enough more to
>justify such a giveaway program? I think those are the factors that IBM
>must wrestle with. That's because they are in business to sell computer
>hardware, not necessarily AS/400 hardware.
>>Again, _WE_ don't buy the systems.  We need people in management excited
>>about the AS/400.  I understand the premise, but IBM's current suite of
>>"e-business" ads promote NOTHING.  In their attempt to remain neutral
>Wrong. They promote IBM as a vendor of e-business solutions. That is what
>IBM is in business for. 
>>I don't know about everyone else, but that policy led to _DISASTER_ here
>>the /400 was first announced.  Local IBM sales rep's aren't well-versed in
>>available packages from BP's worldwide, so they recommend a "local" that
>>isn't really a fit for the client's needs.  For example, a local retail
>>client ended up with a package originally designed for a potato farm!
>That is exactly why IBM's plan has changed so much. IBM doesn't want to be
>the guy sitting and selling to the end user. They want that to be the
>business partner. The partner needs to be qualified with the solution
>being offered. 
>There is no doubt that the change in marketing has been difficult and
>still can use a lot of improvements. If IBM were to try to go back to the
>"old way" there would just be a big closing of doors and a big "going out
>of business" sale.
>>>  Rochester needs to get business partners to support IBM's midrange
>>>  systems. That means the AS/400 and the RS/6000. If you think it is
>>>  plausible that IBM produce all the software solutions to everyone
>>>  business problems you are mistaken. Since IBM must shave the margins on
>>>  hardware they attempt to get business partners to assist in marketing
>>>  machines. In other words, IBM gives out a discount to you as a business
>>>  partner that you can either use as profit margin if you are creating
>>>  enough of a demand by strong marketing or you can pass along to your
>>>  customer so you can make money on your software product or support
>>>  services. 
>>I'd like to hear what the BP's are pushing _BESIDES_ the above!  IBM has
>>out of the (applications) software business for years, and most people
>>that.  No offense, but don't give _ME_ that "margin shaving" business!  A
>>(possibly) multi-million dollar Business Partner is supposed to provide
>>advertising for a multi-BILLION dollar hardware manufacturer in hopes of
>>selling a few copies of their software?  I don't think so!
>Then you should pay attention to the realities of the situation. 
>What are you after? A really big AS/400 ad with 10,000 business partners
>and 100,000 software products listed? Doesn't the futility of trying to
>advertise in that direction strike you? 
>A distribution software vendor should advertise their software in a
>distribution magazine or other such distribution related areas. IBM should
>approach that vendor and state, "We would have sold this machine under the
>'old plan' for $100,000 out of which we would have spent $27,000 on
>marketing. Since you are doing the marketing for us, we will give you the
>$27,000 as a discount. You determine how much of that you can pass on to
>the customer and how much you need to spend on ads etc."
>This lowers the street price of the AS/400 hardware which benefits both
>IBM and the software vendor. 
>You are putting the cart before the horse. Your statements (above) make it
>appear that IBM or the business partner should sell people AS/400s as if
>some customer is going to say, "Wow! This AS/400 ad is really great! I
>better run out at buy one. Now, let's see if there is any software I can
>buy for it that I want." Think about it for a minute. What is the customer
>really buying?
>>The loss to which you refer was IBM's own fault.  They shouldn't expect
>>Business Partners to make up for their own inadequacies, especially when
>>treat the BP's so poorly...
>This made me choke. There are a lot of good business partners that need
>better support and more resources. BUT. 
>I am very familiar with business partners which play the paperwork game
>and fill out all the right forms to qualify as BPs or affiliates just so
>they can be "outside sales agents" and sell IBM hardware while adding zero
>value. These parasites are the damage to the new channel. They soak up
>IBM's resources and margins that should be going to BPs that actually DO
>something for their customers. 
>I worked for a business partner and maybe my experience was unusual (I
>don't know) but IBM was an awesome resource. They provided us with
>advertising, facilities, training, and leads. All we had to bring to the
>table was expertise and manpower. 
>>Dean Asmussen
>Chris Rehm
>You have to ask yourself, "How often can I afford to be unexpectedly out
of business?" 
>Get an AS/400.
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