Solution Selling, what we used to call Consultative Selling, means working with the customer to help them better identify, understand and address their business objectives and what it will take to achieve them. That’s what sets today’s successful resellers apart from hardware order-takers.
If you’re a reseller or distributor in today’s Enterprise IT market, you already know we’re navigating one of the most chaotic market shifts in generations. Some are calling it the start of the second industrial revolution, creative disruption on a global scale driven by virtualization, automation and cloud migration. CompTIA projects that 20,000 VARs and distributors will go out of business by 2020, unable to adapt to the new business models required by changing technology.
There is another side to the story. New business solutions made available by new technology means new opportunities for partners and resellers able to adapt. Some are focusing on infrastructure, some on data, some on applications, but nearly all of them focusing on targeted verticals with defined business solutions that help customers transform their operations. The question that matters most for any reseller in this markets is whether or not you have a strategy to find a piece of the market you can stake the future of your business on. That’s not only important for your ability to engage new customers, it’s even more important for your ability to engage manufacturers.
“Partners who were once sales leaders may find themselves being knocked down a level for rebates and discounts, while partners looking for resources to grow will certainly find MDF harder to secure.”
Just as you’re facing new kinds of customer demands and new business models, manufactures are challenged with finding and enabling partners who can address those demands successfully—and most are struggling to adapt every bit as much as their resellers. Most manufacturers have very little visibility into partner capabilities and performance. They’re often managing 10s of thousands of partners worldwide, with spreadsheets focused on trailing inventory, sales and MDF statistics, while trying to spot the partner that can open a new market with a new IT service model.
With notoriously poor ROI metrics for MDF investments and a community of struggling partners with weakening revenue streams, most manufacturers have no choice but to reset their incentive programs. Partners who were once sales leaders may find themselves being knocked down a level for rebates and discounts, while partners looking for resources to grow will certainly find MDF harder to secure. So how do you compete both for customer revenue in a rapidly changing market, and with other partners for a share of the manufacturing resources required to grow your business?
Perhaps the biggest challenge for resellers right now is that most manufacturers don’t really know how to help you. Incentives, rebates and MDF are only short-term boosts. They don’t help you reposition for new solutions and business models. They don’t help you address the massive migration of IT decision-making outside of the IT department.
Faced with so much disruption and the need to adapt, manufacturers are looking at partners thinking “You’re closest to the customer, you figure out how to reach them and we’ll reward you with more incentives.” Partners are looking at manufacturers thinking, “You’re the Big Brand with so much marketing experience, show us how to do it.” That gap won’t be bridged any time soon, so it’s up to you to figure out how to succeed.
“Manufacturers are lining up their incentive and MDF programs to support partners that can demonstrate successful solution models and drive demand.”
The good news is there’s no conflicting pressure between how you have to show up for customers and the rewards you’ll win from manufacturers if you succeed. Manufacturers are lining up their incentive and MDF programs to support partners that can demonstrate successful solution models and drive demand. If you can find a niche with customers, manufacturer doors will open for you.
So the real imperatives for successful partners are all about focusing on your customers and your value proposition.
In the old days of selling speeds and feeds, “Service” meant making sure everything works, from installation to maintenance and upgrades. Since Everything As A Service took hold, everyone assumes that “Service” means selling technology like a utility, and certainly that’s true. But it’s only part of the story.
The rest of the story is about understanding customer expectations. In a world where technology can be turned off and on like a switch, what resellers offer is a commodity. The real value add for customers is no longer just making things work, it’s making sure the customer achieves the business solution they think they’re buying. That’s what the customer expects, and that’s the new definition of “Service”. If you can’t help your customer better understand their business challenge and resolve it, if you’re only reselling technology and expecting your customer to know what to do with it, you’re offering a commodity.
While some skeptics like to claim “Solution” is just a fancy name for “Product”, it’s more than that. If you’re not exactly sure what a “Solution” is, it’s pretty easy to figure out, particularly in the world of Enterprise IT. For anything a customer might buy, simply ask “Why are you buying this? What objective are you expecting to accomplish? What outcome are you hoping to achieve?” The answer to any one of those questions leads to the Solution.
Why is a customer buying Cloud Storage? Mabye they need to scale capacity beyond what can be stored on site. Maybe they want to lower their cost of storage. The Solution is what it takes for them to achieve that objective. Part of it is certainly the product itself, but the rest is whatever combination of additional products and services are required for goal to be met—that’s a Solution.
Solution Selling requires a good understanding of the business challenges your customers face. It requires access to timely intelligence on technology trends and changes in the marketplace that might effect those business challenges and objectives. It requires relevant information you can share with customers to help them make better purchase decisions. And in a world of social media, it means bringing that timely intelligence and relevant content to your community of prospects and customers in a way that is credible and accessible—on your web site, your blog, your social media accounts, your phone calls and customer visits.
“If you don’t have a Go To Market strategy, in which you prioritize and commit to solutions you believe will build a strong foundation for growth, you’ll be consigned to selling a commodity.”
Most experienced resellers can support a handful of targeted solutions for one or more specific verticals. While traditionally that has provided flexibility and avenues for market expansion, in times of disruption it can make things more challenging for resellers trying to adapt—particularly for resellers driven by sales opportunities more than market strategy. When sales don’t pan out for one solution, or in one targeted vertical, they jump to whatever the next sales opportunity is closest at hand. One month they’re a healthcare solution provider, the next month they’re an education solution provider.
Obviously it’s important to pursue sales opportunities to keep your business running. But if you don’t have a Go To Market (GTM) strategy, in which you prioritize those solutions that you believe will build a strong foundation for growth, you’ll be consigned to selling a commodity. Why is a strategy so important? Because a clear strategy defines and communicates your commitment to a finite set of solutions and customers—your customers will know you specialize in the solutions that are important to them. When you’re chasing opportunities, you have to leave your options open, which means generic solutions on your website and promotional communications that lack focus and speak directly to no one.
The most generic positioning for a reseller is “IT Solution Provider”—and there are many of them out there. It effectively says “Whatever problem you’ve got, we can solve it.” Which may be true, but it also says you’re a jack of all trades. For companies with complex systems that represent high-stakes business problems—say, a healthcare network trying to manage integration of distributed patient data systems—generic solutions are not a worthwhile risk. It’s challenging and often frightening for resellers to commit to defining a specialized focus, but unless you have a strategy for selling high volumes of hardware at low margins, it’s an essential survival step for resellers to take.
If you have a clear GTM strategy, with a set of service-oriented solutions that you’re ready to sell, don’t just leave it to your sales team to make it rain. In today’s digital world, many people on your team can contribute to building your brand reputation, simply by tracking market trends and sharing content to social media that helps attract prospects searching for solutions to the problems you can solve. The key is to tap into the areas of interest and expertise that different team members can bring to the discussion.
Many resellers adapting to market changes hire a marketing specialist, even a social media maven just out of college, and figure they have the bases covered. Certainly adding marketers to your team is a smart move, but it’s even smarter to treat them as coordinators of company-wide marketing behaviors rather than designated drivers. Cross-functional teams of employees, including sales reps, marketers, engineers, support staff, management, and even legal and finance, can contribute valuable knowledge, insights, and especially time to the task of building your reputation and online presence.
“Adding marketers to your team is a smart move, but it’s even smarter to treat them as coordinators of company-wide marketing behaviors rather than designated drivers.”
Yes, it takes some training and commitment, and it’s critical to have management support, but companies that take this approach run laps around their competitors in the marketplace. Not only do these companies build a broader foundation of meaningful content to address customer challenges, but these cross-functional teams generate a more cohesive approach to the challenge of developing new business solutions than companies that take a siloed approach.
We have a unique perspective on the challenge resellers face in a changing marketplace. Before we started a social marketing platform, we ran a marketing agency in Silicon Valley for more than a decade serving IT and Telecom companies. We worked with hundreds of OEMs and partners, branding businesses, developing marketing strategies, building websites and collateral, managing events and running lead gen campaigns. We understand how agencies work, and we’ve seen just about every marketing framework in the book.
Today we work with resellers around the world, enabling them to use our platform for social selling, and we see the challenges they face trying to ramp up their marketing efforts to adapt. When the challenge arises to prioritize solutions and develop a market strategy, we see resellers hire and fire consultants, hop from marketing to PR to advertising agencies, always searching for a clear strategic direction. It doesn’t have to be that hard.
You need a few marketing fundamentals to get started on the right track. You need the commitment from management to focus on prioritizing solutions and verticals. You need to take a team-oriented and agile approach to marketing, particularly centered on generating your own leads rather than relying on manufacturer demand programs. And you need to focus on developing customers and case studies that demonstrate to manufacturers you know where you’re headed and you know how to move your market. If you do those things, manufacturers will beat a path to your door.