CEO Refuses To Pay For Frost & Sullivan Award

JH
John Honovich
•Apr 19, 2018
IPVM

In 2009, we published an article on why Frost & Sullivan awards should not be trusted, since awardees need to pay to tell people they won them, and since the awards themselves are generally dubious in nature and quality.

On the positive side, Frost awards in our industry are now rare. However, Frost is still giving out awards elsewhere, e.g., awards like "2018 Israeli Smart Irrigation Technology New Product Innovation Award" and the "2018 European Payment Processing Platform Customer Value Leadership Award".

One CEO says he refused to pay for a Frost award, explaining:

Obviously, some find enough value in paying 'licensing' the awards that they continue but such practices make a mockery of awards. And, one related trend we have seen in our industry, is that the companies that most often pay license for these awards tend to be those who are less strong and seek to compensate with paid licensed awards.

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JH
John Honovich
•Apr 20, 2018
IPVM

And to my point above about companies that pay license these awards:

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Undisclosed Distributor #1
•Apr 20, 2018

What a racket. The award should come with a disclaimer.

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Brad Peterson
•Apr 20, 2018

Its NOT an award, its a purchase!

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Ari Erenthal
•Apr 20, 2018
Chesapeake & Midlantic

What I'm taking away from this story is that the dude got a free dinner. 

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JH
John Honovich
•Apr 20, 2018
IPVM
In reply to Ari Erenthal

Be the optimist, Ari!

I, as the pessimist, am thinking: "Is Frost going to try to sue this guy for disclosing he did not purchase won their award?" :)

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Ari Erenthal
•Apr 20, 2018
Chesapeake & Midlantic
In reply to John Honovich

All salespeople are optimists. Otherwise, we'd be writers. 

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Brad Peterson
•Apr 20, 2018
In reply to John Honovich

He better have something in writing...

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Brad Peterson
•Apr 20, 2018
In reply to Brad Peterson

They better have something in writing 

LT
Larry Tracy
•Apr 21, 2018

Total waste of money never seen one of their company reports that was remotely accurate

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JH
John Honovich
•Apr 21, 2018
IPVM
In reply to Larry Tracy

Larry, while the reports are typically the company's marketing material rephrased, the companies are not paying for the reports but for the ability to say 'Frost & Sullivan says we are a leader'. Whether that is a waste of money, depends. Take Verint. At their size, $15,000 is a rounding error so as long as some people think positively of it, it could make sense for Verint. Of course, there are the people who understand what a Frost award is and think less of Verint for it...

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LT
Larry Tracy
•Apr 22, 2018
In reply to John Honovich

I don't disagree with most of what you say but if your private they were always very inaccurate for the reports they issued in the past, but again I don't know as the last ten years as I haven't been involved. 

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Undisclosed #2
•Apr 22, 2018

What is the front end process to be 'nominated' for a F&S award?

i.e. do companies that wish to be considered for an F&S award have to pay anything to F&S to be considered in the first place?

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JH
John Honovich
•Apr 22, 2018
IPVM
In reply to Undisclosed #2

#2, that's a good question. From what I can tell, many if not most of these awards are made up for the company, i.e., they are not standard categories from year to year (e.g., think NBA MVP, RoY, Most Improved, etc.).

As an example, Verint is Frost's 'Physical Security Intelligence Solutions Company of the Year Award' for 2017. But I can't find any record of winners in that category for 2016, 2015, etc. Another example is the 'Israeli Smart Irrigation Technology New Product Innovation Award' which has a winner for 2018, but none for 2017 or 2016, etc.

From what companies have told me over the years, not only do they not need to pay to be considered, often Frost reaches out to them cold. And that is where the license / pay pitch comes in, i.e., "Hey congrats you won this award, just pay us X and you can tell people you won."

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Undisclosed #2
•Apr 22, 2018
In reply to John Honovich

LOL!  I didn't realize that they made new award categories up each year.

If that is the case (and I believe you), then the 'winner' most probably gets to choose the name of their own award, tailored to whatever their current marketing effort wishes to showcase.

Further, I'm sure that this is the hook first employed in the original cold call from Frost & Sullivan sales people to manufacturers.

Frost & Sullivan are paid-for PR - so it's no wonder that the content of their reports is garbage (as per Larry above)... it's not their real purpose to be correct, but instead to shill for 'award winners' they've sold on the value of such a thing.

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Ari Erenthal
•Apr 23, 2018
Chesapeake & Midlantic
In reply to Undisclosed #2

Well, it’s obvious what we must do: crowdfund an award for John Honovich and IPVM. 

Come on, I’ll set up a Kickstarter. Five bucks a pop. We can do this! 

Leave your suggestions for an award category below. 

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JH
John Honovich
•Apr 23, 2018
IPVM
In reply to Ari Erenthal

The 2018 Worst Hawaiian Online Blogger 2018 Award

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Undisclosed Integrator #3
•Apr 25, 2018
In reply to John Honovich

Case closed! (too soon?)

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Lode Caenepeel
•Apr 25, 2018

7 years ago I got as CEO of Traficon a similar letter from them which I also refused.

The letter is still the same after all these years. You just get a written proposal without prior contact on the reward title or anything else.

Never found out how you get on their target list.

The only value I saw at that moment is if you are in a selling modus of the company  this can bring you some publicity and you might get noticed by parties which otherwise never would pay attention to you. 

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DP
David Pilchick
•Apr 25, 2018
Brooklyn Low Voltage Supply

This seems to be a common occurrence. One of my customers suggested that I apply for the Inc magazine ״fastest growing company” award. I was very disenchanted when they charged me an application fee. However, after I looked into it I realized that the $150 they were requesting was in fact as they claimed to help defray the cost of putting the list together. They also publish the same list every year and it is a fact based award. However as with anything its all about making money. They sell your info to anyone that is willing to pay for it. I got bombarded by everyone from companies that make plaques all the way to investment houses looking to buy my company. It is a publicly published list, so once they release it anyone can access it. They sent me a renewal and I turned them down. It was fun once, but I wont do it again. On the other hand this company “charging a license fee” is absolutely ridiculous. Kudos for not falling for the scam

 

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JH
John Honovich
•Apr 25, 2018
IPVM
In reply to David Pilchick

David, Inc only charged $150? If so, that's not bad at all. That's literally 99% less than Frost & Sullivan for a listing that carries far more weight.

For what it's worth, those Inc lists hold fairly solid weight for validating companies.

DP
David Pilchick
•Apr 25, 2018
Brooklyn Low Voltage Supply
In reply to John Honovich

Yes Sir

I just looked up the fee to see where its up to for this year 

They raised it to $175

Still fair 

They are surprisingly thorough

I had to provide audited financials and they contacted our accounting firm to ask questions and verify certain details 

Like I said, they earned the $150 !

I always thought that this Frost & Sullivan award was so prestigious

I guess when you pull back the curtain, the wizard is not so magical after all

Great topic !

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JH
John Honovich
•Apr 25, 2018
IPVM
In reply to David Pilchick

David, thanks for the feedback on Inc. I did not realize they were that thorough, that increases my respect for them. Better than Frost ;)

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David Gaw
•Apr 25, 2018

Unfortunately, Frost & Sullivan are not the only culprits. We recently experienced another media firm running this same scam. I would say that in general the "Best of..." pay to play lists that seem to be the hot product of b2b media firms these days are a disservice to b2b marketing.

You can say, 'hey, it is just marketing, so what'. But I think that the misleading nature of these does not reflect well on the media firm or the companies participating.

[and before someone with advanced google skills chimes in - yes, Sensera System has 'won' some of these types of "awards"...!]


David.

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DO
Daniel Olson
•Apr 28, 2018
In reply to David Gaw

Ethics is branding and marketing strategies have fallen by the wayside. Let the buyer beware!

UM
Undisclosed Manufacturer #4
•Apr 25, 2018

"Prestige" doesn't often pay the bills. While I was at a manufacturer doing regional sales, I never won, nor lost, a potential client on the basis of being (or not being) the F&S award winner. I can say that I don't know of anyone who got a lead from a potential client referencing the F&S award.

I can only hope for the F&S business case that I was an isolated case.

DO
Daniel Olson
•Apr 28, 2018
In reply to Undisclosed Manufacturer #4

Creating the perception of prestige may help a company get their name out there and generate more business.  

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