Wednesday, February 4, 2009

In Pursuit of Government Stimulus Dollars

While sales in technology have gotten off to a slow start this year, government spending may be the best hope for many in the communications industry. Federal spending by the US government is expected to be about $80.6 billion on information technology products and services this year, according to a December study released by Compass Intelligence. According to the report this is a 5.5% increase over last year. The report also noted that spending on software applications will be the fastest-growing segment, with an annual growth between 8.6% and 9.8%. Stephanie Atkinson, managing partner and principal analyst at Compass Intelligence offered the following tips when it comes to marketing to government agencies.

1. Register with the government. You can’t sell anything to a government entity without signing up in the Central Contractor Registration database ( But before you can do this, you’ll need a DUNS Number, a unique number assigned by Dun & Bradstreet Inc. Once you’re signed up, make your status known in e-mail marketing as well as paid search results. In fact, consider adding a new e-mail segment so you can disseminate government-specific deals and services.

2. Focus on the short-term return. Even though governments and government agencies are still spending, they must get approval and, most important, answer to constituents regarding their spending. Projects that show a quick ROI are most likely to happen first, since good ROI makes for good press, Atkinson said. This is where a strong, short-term case study or video customer testimonial can really help, she added.

3. Offer different purchase options. “In the past you bought equipment and paid a monthly services fee. Now we’re seeing monthly costs that include some of the equipment costs,” she said. Either way, be prepared to wait to get paid, Atkinson said, since government contract pay terms are definitely longer than your typical net 45 or net 60. “It’s very likely to see three- or six-month payment terms,” she said.

4. Consider marketing yourself as a subcontractor. There are plenty of companies already registered with the government that are getting contracts but may not have in-house expertise or products like the ones you sell. There are several sites that list the best sources to find such companies, and several firms that broker such partnerships, including FedSources,, FindRFP, and BidNet. Sites like let you advertise your company by posting a vendor profile so other companies can seek you out.

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