When launching a new ROI engagement on behalf our clients, we’re often asked: what part of the process will be the most challenging?
We at TFP have played the ROI rodeo plenty of times; well north of 600 opportunity-specific ROI analyses over the last five years, if you want to know. And we know where the obstacles are.
Is it figuring out how much the customer can improve?
Is it gaining consensus about the purchase decision?
Heck no. Most often the hardest part of the ROI process is figuring out not where the customer can be tomorrow, but where they are today. As Arnold Schwarzenegger so eloquently expressed in Total Recall: “If I am not me, then who the hell am I?”
It sometimes take just days to figure out “who the hell” the customer is. Sometimes it’s weeks, putting the ROI engagement (and the sale) at risk. Why does this happen, and what you can do about it?
At TFP we have delivered field-level deal structuring and value selling support to our technology clients since 2000. In many cases our support included consulting on how to best construct and position a volume sale—some form of an enterprise license agreement (ELA), multi-year subscription or other large transaction that provides purchasing efficiency and effectiveness for procurement and sales.
We are all living in a time where we just cannot move fast enough. We are torn between work demands and home. Our mobile devices consistently vie for our attention and we never shut them down out of FOMO (fear of missing out). Thankfully we have friends to keep us grounded.
One of my friends recently invited me to attend a conference. This wasn’t my normal sales or consulting conference. It was all about living a life of presence with Eckart Tolle. I was pleasantly surprised to find the subject matter resonated with me not only on a personal level but, also in my everyday work life and journey.
With more than 20 years’ experience in high tech sales, I’ve had the privilege of participating in many sales calls with a wide variety of sales teams. These include initial discovery calls as well as calls focused specifically on closing a prospect. I’ve also participated in calls focused on install base customers who already committed to the technology; however, the vendor may be focused on selling a complete platform instead of a single product. I’ve seen vendors be wildly successful in the endeavor as well as dismally fail. Most importantly, I’ve noticed a distinct pattern of behavior on the part of the vendor that ultimately leads to either success or failure.
Depending on the nature of the sale, the stage in the technology lifecycle of the customer, their willingness to adapt or change, the art of the sale involves a delicate balance of educating the customer, moving them out of their comfort zone if necessary and creating a vision that is compelling. How to create that delicate balance really depends on the customer, their environment and their overall objectives in the short and the long term as a business. Therefore, it is critical to understand your customer, their business objectives (both long and short term) and what is top of the mind for the organization…listening to your customer. Successful sales teams and vendors understand that demonstration of listening skills is just as important as (or more important than) presenting information.
If you’re a baseball fan like I am, you know how magical those words can be. You also know that we are at a critical point in the season: the stretch run. The boys of summer are getting ready for it, and while much of what happens is predictable, there are bound to be some surprises as well as disappointments. A number of teams still believe they have a chance at winning the World Series and general managers are reviewing their rosters to determine what additions need to take place in order to give their franchises the best opportunity for success.
“Timing is everything.” A cliché, perhaps, but this basic fact is true in both your personal and professional life. In the latter, be your profession a musician, stand-up comic, day-trader, or a sales person, being at the right time, the right place, and having just the right piece of wisdom to impart, will almost always help you carry the day. My specialty is in financial sales execution, so I’ll confine my comments to the sales world.
Like an English football team, “qualification through the rounds” of a deal is critical to success.
One of the most important conversations salespeople have with their prospects is the discovery meeting. Here lies the proverbial fork in the road for you and your prospect. Either they’re a good fit for your product or service and you can move forward with the relationship, or it’s time to part ways.
But it’s not always immediately obvious which path to take. That’s where sales qualification comes in. By asking the right questions, you’ll be able to determine whether the relationship should continue, and if so, what next steps are appropriate. Or disqualification of the prospect ASAP and movement on to the next.
We’re hearing a lot it being the 30th anniversary of John Hughes’ legendary comedy, Ferris Bueller’s Day Off. For many people it’s an opportunity to revel in the lovable scamp’s exploits in joyful defiance of the stressful world of high school, overbearing parents, and exhausting friendships. For me, this occasion is instead a chance to remind the world that Ferris Bueller is the most inherently and unapologetically evil movie character in the history of film—akin to pre-Jedi Darth Vader and the Wicked Witch of the West.
Stay with me here.
Reading about Ferris after all these years, I’ve been struck by how many of my objections to Ferris stand in direct opposition to the virtues of an ROI analysis that a technology vendor might present to a prospect to prove the value of its solution in the customer’s environment. Let’s take a moment to reference Ferris’s malevolent nature as a means to illustrate some ROI best practices.(more…)
My customer is asking for “utility” pricing. How should I respond?
I get this question a lot. My initial reaction is to respond back with a series of questions. Are you sure they are asking for utility pricing? How is the customer defining utility pricing? Utility pricing can mean different things to different people.
It has been my experience that the term utility is over used and what most customers are really asking for is an alternative way to pay for their compute needs. What is utility pricing? Most people agree that true utility pricing is a 100% variable pricing model with no fixed minimum payment, no fixed term, and the price can go up and down based on consumption.
Utility pricing is not necessarily a cloud solution or a managed service solution. Cloud solutions and managed service solutions are more about how the service is being delivered versus how they are being priced. In a cloud solution the customer has access to the infrastructure and resources but they don’t own them and generally only pay for what they consume. However, even some cloud solutions use flat rates.
Some customers will have a very clear idea of what they are asking for. Others aren’t entirely sure but say that your competition is offering utility pricing. Which only means they are offering a pricing model that they are calling a utility pricing model. It may or may not be a 100% variable solution. (more…)