In retrospect, it's hard to imagine Todd Thibodeaux's arrival at CompTIA happening during a more volatile period. After being named the IT trade association's CEO in June 2008, Thibodeaux's official start date was Sept. 1 -- just two weeks before Lehman Brothers filed for the largest bankruptcy in U.S. history and triggered the financial crisis. While contending with the worst economic recession in decades, the organization also was faced with an altering technology landscape that was shifting away from PC hardware to new areas such as cloud computing and mobile devices.
There were even more challenges for Thibodeaux, including questions about its relevance with a younger, more dynamic IT workforce. CRN spoke with Thibodeaux earlier this year about CompTIA and the challenges it faces in today's world. Here are excerpts from the conversation.
CRN: You've made many changes in the past five years at CompTIA, including lowering the membership dues. Is it harder today for technology trade associations to justify the kind of high membership costs we've seen in the past?
Thibodeaux: Trade associations always struggle with trying to find the right kind of dues. We've lowered our dues dramatically. If you're a large company today, say a big vendor or distributor, your CompTIA dues are only $5,000. ... So yes, I think it is hard in a sense for associations that don't have large trade shows. Most trade groups that have large international trade shows, whether it's the wireless industry with Infocomm or consumer electronics with CES, usually have a member discount for those shows that more than covers the dues. For example, you have a very high retention rate for companies that exhibit at CES, and the CEA [Consumer Electronics Association] can justify higher dues. There was a time when the Home Appliance Manufacturers Association had microwave oven makers paying $600,000 a year to the organization. But it was so important to the microwave oven business at the time that those manufacturers be a part of AHAM and get their products out that it was worth the money. But for organizations like us, there's no quid pro quo around an event.
Honestly, the biggest change has been for members to not look at CompTIA as a lead-generation organization. That's not what we are. We don't take sponsorship money for our Breakaway event. We don't really recoup anything from that event. We had to change people's mind-sets, and when we made the decision to move away from sponsorships and hosting events, that's when the attitude toward the organization began to change and people began to look at us in a more positive light and less as a lead-generation organization.
CRN: So for CompTIA today, the majority of revenue still comes from certification exams?
Thibodeaux: Ninety percent of the money comes from the sales of the tests. We'll typically certify 250,000 people a year worldwide, with 30 percent outside the U.S. It's a volume business, but it's a nice steady stream of revenue.
CRN: How has the industry changed since you first came aboard in mid-2008?
Thibodeaux: The industry has changed a lot over that time. The modern approach to managed services had really only been around in a meaningful way for probably a little more than a year at the time I came in. You had a lot of people wondering what that was all about, and what it meant to their businesses models in terms of recurring revenue models. We got reasonably quick adoption for that model, considering what a sea change it was [compared to the traditional reseller model]. And then bam -- all of the sudden health-care IT comes into play and then on the heels of that, you had cloud computing and mobility hitting the industry. So over the last four years, it's been difficult for companies, especially smaller ones, to understand which way to go. There are so many different options for how they're going to deploy their businesses today. Is cloud different from managed services or is it a subset of that? What does it mean to get into the health-care vertical? Companies are struggling with how to manage mobility fleets, so how to you take advantage of that? While they see tons of opportunities out there, it's unclear which direction they should go.
At the same time, we've had one of the more sluggish periods of economic growth, which has probably impacted people's businesses more than anything else. They want to grow their business and take advantage of new opportunities, but access to capital that they had in the past isn't there. You have lots of new opportunities, mystery around which ones to follow, and then a lack of resources and aggregate demand in the economy to really take advantage of it. Some of the companies that we saw really excel during this period were ones that got into very specific niches as opposed to being a general provider of IT resources -- for example, the people that went strictly telecom or health care or became cloud-only. Very rarely did we see a situation where someone was able to go deeper with their clientele and manage a wider facet of their IT business. I don't want to say it was an all-or-nothing approach during that time, but I'm not sure the industry is seeing as much of the benefits of these new technologies and innovations as we might have seen.
CRN: Is that the biggest challenge then for CompTIA today -- guiding companies that are looking to change their business models?
Thibodeaux: We've reorganized our entire value proposition as an organization around vendor-neutral channel education. ... We did a lot of general channel knowledge stuff when I arrived but over the last two years our education has transitioned more to a 'How do I make this work in my business?' approach. Instead of just educating people about the opportunity, we're giving them concrete steps and plans that, if they follow, their chances for success are, we believe, demonstrably better. We have a lot of content like Fast Facts and Quick Start Guides, which educate people more on the background of a new technology or market with some metrics. We also have 10-week guides that go into further detail, where people can come and take an in-person education course that we deliver at different channel events we offer and then follow that up with a 10-week 'prescription' for making a sea change in their business.
But it always shocks me that so few people are actually aware of the opportunities that are out there. We served almost 9,000 people with our education services last year, but I'm still surprised at how many people don't take advantage of these things. I know the answers as to why are obvious -- the companies are small, the CEOs are the primary decision-makers within these companies, and if they don't decide to take these steps, observe the material and filter it through their companies, then it's not going to happen. The bottom line is, the vast percentage of companies in the IT channel are small and have limited resources to take advantage of these things.
CRN: What effect has this value proposition change had on your membership base?
Thibodeaux: We do surveys on this and we get high ratings on the education offerings. For the people that take advantage of it, they feel it's had a meaningful impact on their business. This year we're hoping to quantify what the exact things are that they're benefiting from. So for example, if a company successfully gets into a vertical after using the cloud computing 10-week guide, did it help their bottom-line financials? We have to do a little more work on that, but at least anecdotally we're hearing that they expect the education beforehand to have a meaningful impact and that, yes, it is having a meaningful impact on their business afterward. We just need to quantify how.
CRN: But is it having a material effect on your membership numbers? It sounds like this is something that you created to bring in more solution providers. Has it?
Thibodeaux: We've definitely positioned it as something to bring people into the organization. But in effect, we've served a lot more people than our membership. For example, the education content that we might do at a Tech Data event or a Synnex event is available to more than just CompTIA members. We're not so concerned with how many new members it gets us because our membership numbers have stayed roughly the same at 2,200. But we serve four to five times that number with our education. We're looking at a model for 2013 that might open up the content to anyone in channel who wants it, regardless if they're a CompTIA member or not.
CRN: That's a big change for CompTIA, considering years ago the organization earned a lot of revenue from exclusive offerings for official members only. Do you expect a more open content model to help you reach younger people and newer solution providers that may not be as familiar with CompTIA?
Thibodeaux: What you have in the channel right now is a few different segments. You have the older guard or people that work for companies run by the older guard of the channel that do lots of industry events, and when you put some of the education offerings in front of them, they consume it like crazy. They think it's great, and they put it into action in their businesses. You have a segment of people that will look for something when they need help but they don't necessarily seek it out at industry events; they'll maybe download stuff from the Web. Then there's a young group of people that you really have to push stuff to, and that's another approach that we have to deal with this year. We have a model where we can put the education in front of people at live events and they consume it, and a model that allows people to engage in Webinars and other online content. But in the smartphone and tablet world of today, you have to be able to push content. Think about Twitter, Facebook and all the social media. It's based on pushing content out rather than trying to pull people back to your website.
CRN: So how will social media play a role for CompTIA in 2013?
Thibodeaux: I think someone will write a book in 20 years about how social media killed trade associations. It's not just us; this is trade associations in general. For example, look at the American Medical Association; doctors 45 and older are members of AMA at an extremely high rate, maybe 75 percent. But less than 40 percent of doctors under 45 years old are AMA members. There are some pretty serious gaps there. People aren't willing to pay to network with somebody. Much of what we have now is [peer-to-peer] networking for free. In the past, you had to pay for that; you had to pay to become a member of a professional society. We're all going to have to come to grips with that, and CompTIA is just lucky enough that we don't rely on member dues at all for our revenue.
CRN: How do you turn social media from a threat to an advantage?
Thibodeaux: We do Facebook pages and LinkedIn groups and Twitter feeds for our site, but the real value is the educational content and transitioning that content into something that can be consumed on a tablet or a smartphone. Right now we have a very PC-centric value proposition. To consume our stuff now, you have to sit at a computer and download a white paper or watch a Webinar or a recorded education session. What we need to do is find a way to push some of that content to people.
CRN: How do you stay relevant as a group today as the demographics of the industry change?
Thibodeaux: It still comes down to a behavior issue: If you can understand the behavior and the motivations of the audience you're trying to serve, then you'll never lack content for that audience. But if you don't understand the behavior or worse, you see the behavior and say, 'Well, that's not how they should behave,' then you've already lost. You have to understand how your audience behaves and then tailor your organization to adjust to that. Trade associations have historically been very poor at that. Plus, they haven't had to deal with this kind of sea change in years. Coming out of the post-war era when trade associations really exploded, you had a very homogeneous generation. But now we're in an era that changes faster than ever. Again, you have to understand the motivations of younger generations. You have to figure them out, not the other way around. If you don't, then you're really only relevant to a fading audience.
PUBLISHED MARCH 25, 2013