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IBM Analysis Finds Consumer Expectations Remain High in 2008 Despite Dramatic Shifts in Marketplace

Businesses Recognize Power of Consumers, Move to Leverage Trend for Differentiation in 2009

ARMONK, NY - 22 Dec 2008: IBM (NYSE:IBM) today announced consumers continued to flex their influence on businesses and institutions in 2008 despite dramatic shifts in global markets. Based on an analysis of surveys conducted with consumers throughout the year, IBM consultants are advising clients to remain focused on understanding and adapting to the needs of today's empowered and informed consumers as a means of differentiation in 2009.

In 2008 the rapid proliferation of mobile devices and rise of social networking have dramatically changed consumer expectations and behaviors and have impacted the future of a number of industries including: consumer electronics, travel, media and entertainment, retail and auto. Consumers are in more control than ever before, and through the use of these tools, can easily rally fellow consumers to demand products and services that are tailored to them and improve their lives.

Further evidence of this growing consumer control point was noted in IBM's Global CEO Study, the largest study of chief executives ever conducted. CEOs pointed specifically to their own customer base as the source of the most important changes they will have to address, as two new and more demanding classes of customers emerged: the 'information omnivore,' and the 'socially-minded' customer.

Overall CEOs are planning a 22 percent increase in investments in the next three years to serve these more sophisticated and demanding customers. CEOs in the U.S., Europe and China indicated they plan an average investment jump of 19 percent at these targeted customers over the next three years.

"Consumers are becoming 'producers,' often creating entertainment and advertising content for their peers while demanding flexibility and responsiveness from companies with whom they choose to do business. These customers are more demanding; however, the majority of CEOs do not see them as a threat, but as an opportunity for differentiation -- based on meeting the heightened expectations of this group, and capitalizing on new market opportunities that will emerge," said Peter Korsten, Global Leader, IBM Institute for Business Value. "Dealing with this new breed of consumer in the midst of a whole new economic environment will play a major role in companies' agendas for the foreseeable future."

Consistent consumer attitude and behavior was also seen across multiple industries based on the studies conducted by the IBM Institute for Business Value:

Consumer Electronics

 Travel

 Media & Entertainment

 Retail

 Auto

About the IBM Institute for Business Value
The IBM Institute for Business Value provides strategic insights and recommendations that address critical business challenges to help clients capitalize on new opportunities. The Institute is comprised of consultants around the world who conduct research and analysis in 17 industries and across five functional disciplines, including human capital management, financial management, corporate strategy, supply chain management and customer relationship management. For more information on IBM, please visit: www.ibm.com

Contact(s) information

Sarah C. Spencer
IBM Media Relations
917-472-3728
scspence@us.ibm.com

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