I was in a conversation with the CEO of a CRM company the other day discussing the latest moves in the industry over ideas like SaaS, single tenant and multitenant deployments. It has occurred to me and I said this to the CEO, that we spend far too much time and brain matter on the delivery model and too little on how we provide value to the customer.
It’s a problem that you see a lot if you know what to look for. It happens whenever one vendor or even an individual comes up with an idea that seems to attract customer attention. Once that happens, the competition is all over the idea like flies on a fresh meadow muffin and the whole competition moves to one dimension. I’ve seen it on numerous occasions in my ten years covering CRM and the single tenant vs. multitenant debate is just one example. Other examples include the customer experience and social CRM.
Now, to be sure, all of these ideas are important but they also hit wide of the mark. The mark ought to be how I as a vendor deliver value to you the customer and whether that value is sufficient to warrant a purchase. Ideas like low cost and fast implementation or improving the customer experience are, by their nature, designed to appeal to the buying influences in the complex sale of CRM. They appeal to the CFO or the CEO. Customer experience may appeal to the VP of sales or the VP of service and so on. But you can’t take any of that to the bank.
There is an implicit assumption in all of this, that a CRM product is in all other respects the same as all others in the market and that this single idea is the one worth contending over. That’s a road to disaster if you ask me because only one company can be the best at the attribute in question and then everyone else is scrambling for second place. That’s a path — no, make that a short cut — to commoditization.
It’s a harder sell to talk about the customer’s needs and what makes them unique and deserving of unique treatment — often the customer doesn’t know and the sales representative might not have the training or knowledge to help figure it all out and sell to those needs. Too often in early markets customers buy market leading products regardless of their merits and vendors accommodate this need by bragging about market share.
If we could focus more on how we deliver specific value, the sales and marketing conversation would be richer and you might actually see one vendor competing for business based on a specific need as well as other vendors competing on delivery model or price etc. But that’s a scary place to be if you are a sales person. Your customer wouldn’t necessarily be comparing you with the other guys in an apples to apples way so how would you know if you were winning?
Selling has always been a numbers game meaning that sales people needed to see as many people as possible, have as many contacts and opportunities as possible in the hope of closing some of them. That was the original assumption of CRM. But if you are at all cognizant of the marketplace these days, tightness in the credit markets has caused a significant amount of demand destruction and that has changed the terms of selling.
We don’t have full pipelines because of demand destruction or, if we do, there are many more suspects who can’t buy for one reason or another tied to budget. In this world selling the advantages of your delivery model or your low cost may not be as valuable as telling your customer specifically how your product can help make money or save it.
We’re in a cross sell/up sell market today in which we’re trying to sell something else to a customer that has bought from us before. In that climate it should be easy to talk about using products that enhance a specific business process or function.