On February 20, 2014, as part of the 14th edition of CEO Vision, the Quebec Technology Association (AQT) revealed the results of its Competitiveness Barometer, a detailed report on the key priorities of ICT businesses. The leaders of nearly 700 companies shared data in 2013 via the Web or during telephone interviews. The analysis focuses on companies with 4 to 500 employees. The survey, which has been conducted independently by the SOM Research and Surveys firm since 2010, reveals the business practices and status of Quebec’s ICT businesses based on four performance indicators: Human resources, innovation, revenue and marketing.
The report highlights a few interesting findings and conclusions regarding Quebec’s ICT companies doing business outside of Quebec. Namely that 76% of them claim to have done business outside of Quebec in 2013, an 8% increase over 2012 and a 13% increase over 2011. Similarly, the average proportion of sales realized outside of Quebec is also on the rise compared to 2012, but remains slightly below 2011 levels. From this, we can surmise that more and more ICT businesses are trading outside of Quebec, but that few of them are generating the majority of their sales outside of Quebec. In fact, only 6 % of responding companies traded solely outside of Quebec. Finally, the report highlights the fact that solutions worth over $100,000 garner the most interest outside of Quebec. These solutions often address complex issues for which buyers will not hesitate to look abroad.
As the study also focused on sales practices within Quebec as well as outside, findings revealed that sales methods vary considerably between the local market and outside markets. For example, while 40% of respondents say they depend mainly on their website to generate local sales, only 10% of them say that they count mainly on their website for sales outside of Quebec. Ironically, while the Internet should normally break down geographic barriers and enable SMEs to quickly access world markets, especially in the ICT world, the study shows that when it comes to selling outside of Quebec, ICT companies still bank mainly on trade shows, on hiring foreign salespeople, on sending local salespeople abroad and on the CEO’s role as an ambassador to generate sales. Either the companies do not understand how to effectively use the Internet to generate sales outside of Quebec, or realizing sales still depends largely on human relationships, even in faraway markets, even in the age of technology.
In conclusion, this data indicates that in spite of the Internet, in spite of globalization, exporting remains a challenge for the Quebec ICT businesses that wish to be successful outside of Quebec. They must develop a niche market where they can stand out and, most importantly, they must invest in an international marketing strategy that involves proactive marketing in the form of prospecting trips, hiring salespeople or taking part in trade shows. Without this investment and a regular presence on the targeted market, chances are slim that the business will see any kind of success outside of the local market. Fortunately, the percentage of ICT businesses doing business outside of Quebec has risen constantly over the past few years, which tells us that more and more of them are willing to take up the challenge.
To download the 2013 AQT Competitiveness Barometer for free, click here.
Bruno Séguin
