A management consulting firm Analysys Mason survey found that 64% of respondents plan to increase IT expenditures by 4.4% on average in 2023, down from 5.2% six months ago. Despite this, 69% of respondents still expect a year-on-year increase in revenue. As a result, SMBs are going through a period of “strategic realignment” and will reevaluate IT spending priorities, leading to longer sales cycles.
On the other hand, Gartner reveals that most technology buyers regret their purchases as soon as they’re made, especially renewing or expanding as-a-service agreements. 60% of technology buyers involved in such decisions regretted nearly every purchase they made, which is a 6% increase from 2020. It’s worth noting that this surveying involves companies with revenues of at least $50 million.
Why do we care?
Let’s put aside the company size, as I think it’s a red herring. This data is still valuable. These reports aren’t saying full steam ahead on spending. They’re saying that customers are not quite as eager to spend and find themselves second guessing previous spending. I’ve been thinking about why customers buy and the disconnect between technology implementations and business outcomes. That’s the critical area of focus for technology providers, particularly now.