Cloud marketing strategy: Do consumers care if it's called cloud?

While some providers play up the lingo in consumer cloud marketing, others say confusion has left the term 'cloud' too diluted to be valuable.

Though the ideas behind cloud computing have been around since the 1960s, and the term itself cropped up more than a decade ago, grasping the concept of "the cloud" still seems to be a challenge for many consumers.

Eric Schmidt, then-CEO of Google, famously introduced the term to the general public and mass media at a conference in 2006. In the years that followed, the meaning of "cloud" began to settle into its current context. And while cloud computing has now become nearly ubiquitous, comprehension of the concept has been slower to catch on.

"Consumers don't necessarily understand cloud," analyst Mike Jude said. His work as a program manager at Stratecast, a division of Frost & Sullivan, has put IT branding into perspective. A recent survey the firm conducted revealed that while most consumers claimed they did not use cloud computing, in reality almost all were users of popular cloud-based applications such as  Gmail and Facebook, online storage and other services.

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"They've heard of cloud, but they don't actually understand that they're using cloud. And I think that that's kind of the key thing for consumers," Jude said. "We've always found that consumers are focused more on the service than they are on the technology."

Given this lack of understanding, the popularity of cloud-based apps such as Google Drive and Dropbox has shown that large companies can successfully execute their cloud marketing strategies without consumers being completely aware of the significance of the technology. Other providers are trying to build a more cloud-cognizant base, however, in hopes that customers will choose the option that is explicitly identified as a cloud service or provider. That's because consumers who recognize the use of the cloud in their daily activities may be more likely to seek out cloud services for other tasks at home and at work, since they associate the concept of cloud with efficiency and convenience, according to a recent report.

A 2012 Wakefield Research study commissioned by Citrix found that even people unaware of exactly what the cloud is recognized its benefits. As quoted in the report, Citrix Vice President of Corporate Marketing Kim DeCarlis said that this means "the cloud is viewed favorably by the majority of Americans, and when people learn more about the cloud, they understand it can vastly improve the balance between their work and personal lives."

Consumers may have bright thoughts about the cloud, but it's not clear they understand what the term means, since pinning down a simple definition to describe the services has proved slippery. The National Institute of Standards and Technology's definition  of cloud computing covers the scope of the technical characteristics and service models in a way that is useful to engineers and marketers, but opaque for many users. It doesn't help matters that the industry also continues to see a fair amount of "cloud washing" by providers trying to capitalize on the hype at the expense of consumer trust.

"'Cloud' has become a term that's sort of entered the vernacular over the last year or so, but still, the average consumer doesn't really understand what the cloud is," said Tom Langridge, co-founder and vice president of product and communications at MediaFire, a cloud storage provider based in Shenandoah, Texas.

Langridge, who has spent a lot of time on product evangelism throughout his career, said using the term "cloud" in marketing floats a basic impression of how resources are accessed or stored, but doesn't offer much else in terms of a definition of cloud.

"It's really just become something that's been a marketing term to help people understand sort of the -- no pun intended -- nebulous nature of storing all your stuff in the cloud and working with data that's on the Internet," he explained.

Cloud storage and sync providers split on cloud marketing strategies

For a provider whose core product includes cloud storage services or syncing tools, the gap between user demand and understanding can make selling the technology tricky. There are some caveats to marketing a brand on a term like "cloud," loaded as the word is with the heft of market hype and the burden of potential intimidation for consumers concerned with complexity, security and privacy issues.

Growth across the cloud services industry and, increasingly, in the consumer sphere has compelled many providers to consider concurrent strategies for reaching two different markets. Individual consumers and enterprises will naturally have different goals and requirements, even if they're looking to the cloud as a means to the same end.

So far, 'cloud' in the consumer space hasn't really resonated that well.

Mike Jude, 
program manager, 
Stratecast

Providers approach cloud marketing and brand development from a variety of angles. Consumer market leader Apple and up-and-comer Amazon have run with the cloud moniker in their respective products, iCloud and Amazon Cloud Drive. Meanwhile, smaller players such as CloudMe and MegaCloud have adopted a similar branding strategy. Tying their brand to the term can give providers a measure of visibility in the consumer and small business markets.

Nevertheless, Stratecast's Jude cast some doubt on the benefits of the cloud label.

"So far, 'cloud' in the consumer space hasn't really resonated that well," he said. "It hasn't actually leveraged any more business for anybody than not saying 'cloud.'"

Microsoft, which hammered its "To the cloud!" slogan a few years ago in a series of commercials marketing Windows 7, toned down its approach when branding its consumer cloud storage service as SkyDrive. Meanwhile, Google has kept "cloud" away from almost all of its consumer offerings minus Google Cloud Print, and reserved the label for its business services portfolio. Dropbox, another top consumer cloud storage and sync provider, also sidesteps the cloud as a brand.

Other cloud backup and syncing providers such as SpiderOak, which services businesses and individuals, have also strategized around this line of thinking.

CEO Ethan Oberman said the company meshed two words together for a combination that allowed for greater differentiation. "Spider" connected to the idea of the Web, while "oak" connoted a sense of security and stability -- two features SpiderOak emphatically touts.

"The other real benefit," he said, "is it gave us the flexibility to do things that we may not have known we were going to do when we started. There were a lot of companies that used the term 'drive' or 'backup' or 'i' this. And to me, having the flexibility to potentially do something else down the road -- just to leverage the SpiderOak brand -- I thought was critical."

Why consumers matter: 'They become champions of your product'

Despite the confusion over branding consumer cloud services, providers still see merit in pursuing the market. For Oberman, his goal is has less to do with having consumers understand they're using cloud than having them recognize the brand for its services. Gaining that recognition means an advantage not only in the consumer market, but in the enterprise space as well.

"One of the things we have seen over the last several years is this consumerization of IT concept has really taken off," Oberman said. He described how business customers have adopted SpiderOak as a more secure alternative to Dropbox, which employees were beginning to use at work as they used it at home.

Other providers echoed this observation. Mike Trigg, chief marketing officer at YouSendIt, said that many of the company's major customers had hundreds or even thousands of employees using YouSendIt before the business decided to buy an enterprise license.

"A lot of your awareness and brand-building is really done by your users," Trigg said. "They become champions of your product and they communicate about it internally, and that becomes the catalyst for getting a larger deal."

Given the influence individual users can have on the IT decisions of major companies, marketing strategies in the consumer sector matter. But in a crowded cloud market that shows no sign of thinning out, shifting the focus of brand development to highlight other attributes might prove essential as the significance of the term "cloud" dilutes.

 "[Providers are] selling cloud services generally on the basis of pure economics -- capital investment, that sort of thing," Jude explained." And I've always thought that's sort of missing a bit: that if I were in the business of selling cloud anything, I would package it as an insurance policy."

Let us know what you think about the story; email Madelyn Stone, editorial assistant.

This was first published in April 2013

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