That is, for the most part, products are provided by the originating vendor fully formed, albeit not commercialised specifically for the channel end user, for the reseller to purchase wholesale and then break into smaller, more consumable parts for consumption by the business customer.
Value is added at this point through services such as reliably available and attentive customer services, qualified and responsive installation engineers and consultative sales people. But often in these instances, where the real cost benefit of providing experienced engineers and 24/7 customer support is difficult to put into tangible commercial terms, the conversation can quickly devolve to the price of the product being sold.
The reality is that today the end user customer is offered a dizzying choice of solutions and commoditised products from a huge range of vendors who are all racing to the bottom. In some cases, these solutions appear to be offered free at the point of consumption, (minutes, apps, installation and so on.)
True value therefore can only be derived from the unique interaction with you as the reseller and the combination of products, services and solutions you provide. You become indispensable when you create an experience that the customer quickly comes to rely on. These customer essential solutions can be created by bundling together a number of seemingly unrelated products and services to provide the customer with something that they cannot get from anyone else.
When taking a number of pre-existing products (comms and others) and bundling them together, a ‘New Product Development’ (NPD) approach shows us there are a number of steps that can be taken to greatly improve the solutions chances of commercial success.
Creating effective bundles can be a complex thing, but following a systematic process can greatly remove the confusion within the development phase. Consider the following.
- Idea Generation
- Brainstorm ideas, get weird, get inventive. Get a room of people together with an endless supply of coffee and Kit-Kats. Don’t forget to kill the black hat.
- Your knowledge of the market, your customers ‘pain points’ and the product that you sell is the perfect starting point for the idea of which bundle of products is going to be useful. Benchmarking what others are doing is a great place to start, but your knowledge is going to be the differentiating factor. Use a SWOT analysis as a starting point for the bundle ideas that are being generated. Look at innovative products and your customer’s behaviour.
- Identify the good ideas (Put the black hat on, briefly)
- Get rid of the silly ideas, but praise the inventor so as not to dissuade them from contributing next time.
- Compare the idea against your customers need. What else is out there? What are you as a company good at? How easy or challenging it is to launch the solution? How profitable might it be? Don’t use gut feelings and sketches on the back of a fag packet. (Do people still do this?) Do the hard sums, trust me, it will pay off down the road.
- Test the idea internally (and with some select, trusted customers.)
- Mock up some marketing ideas around the solution and see if this is something that fits in with your brand. Float the concept to everyone within the business and get feedback. Are you inadvertently copying someone else’s idea, or is it truly unique? Copying something is not a bad idea, but it does need to stand out.
- Think about your customer, will they get excited about this? Does it meet a real-world issue or is this an exercise in vanity? Be honest, be brutal.
- Involve a small number of customers to chew through the proposition, just make sure they aren’t going to rely on it as a complete solution at this stage. (It’s still officially a concept!)
- Run the numbers
- You’ve got an idea, it’s exciting, customer feedback is overwhelmingly positive. Good job. Now run the numbers with your finance people. Estimate price, uptake, costs, overheads, and so on. Will it be profitable from day 1, or is there a break-even point? Again (and I cannot stress this enough), do the sums, so there are no surprises.
- There are a number of product forecasting models available to use, but base your numbers on your experience, the size of your estate, wallet share of your customers spend, current product uptake (products per customer), total spend distribution and so on. The tough number to calculate will be the uptake of the new product, but the small number of trusted customers you floated the idea past in the previous point will help to fix that number
- Test the whole solution
- The way the end user customer interacts with the solution comes into play here as you put together the beta phase of the bundle. This will involve the sales tools, (mocked up if necessary), provisioning and installation processes, internal training, customer services training, first, second and third line support and so on. There may be legal issues that need to be considered, contract lengths and so on. (If the individual elements of the bundle require different commitments). All of these need to be considered whilst you involve a small number of trial customers to engage with the process. (This could be the same group as before.)
- Getting feedback from the trial group is essential here, and you might need to revisit and review some of the elements before rolling it out to the entire estate.
- Ready to launch
- You’re there, the solution has been created, the trial has been successful and marketing are generating new leads and encouraging upsell / cross sell opportunities within the existing base. Now it is time to launch. You need to cross the i’s and dot the t’s. Update your processes and quality manuals, ensure that you have the right resource in the right place, fully trained in the new systems. Update your marketing and product information, review the numbers with your vendors and put in measurement and control systems.
- Launch and Market
- Consider a launch event, PR, advertising, and marketing content. What problem are you solving for the customer? How is this going to solve their pain in a way that no-one else can? Take all of the feedback, lessons learned and initial thinking and engage with your customers. Get your sales team enthused and excited about the opportunities this presents.
- Measure, measure, measure
- Nothing ever goes 100% to plan, so identify where things have fallen by the wayside and incorporate them into business as usual. Make commercial changes where necessary, understand where it’s going well and where improvements are needed.
- Have a good look at what the competition is doing. Are they copying you? Good. You’ve proved the concept, now stay one step ahead by innovating the next phase.
- Go back to step 1
Why do all of this? It does seem a very long winded way of adding connectivity and mobile apps to a PBX installation.
What problem are you trying to solve here? How does it answer the questions that your customer is asking? What are the underlying technologies that enable the solution to thrive? What are the real benefits to the customer, the tangible and intangible upsides that mean they cannot envisage carrying on their day to day operations without the solution that you have created for them?
Answer these questions and you are well on your way to becoming an integral part in your customer’s success story and therefore your own continued growth. And of course, if you need help navigating through all of that, give us a call.