Information Technology Solution Sales Methods That Work
The Information Technology solution sale is a tricky business. It is definitely a complex sale, with many different decision makers, multiple competitors, and a continuously changing mix of capabilities, cost, and value. Throw in disruptive technology change on a regular basis that can entirely upend business models, and it all leads to one of the most challenging sales environments out there.
In that type of environment, there is the opportunity to create a solution for a customer that can make a significant positive impact on their business. If a customer can upgrade their systems and reap big benefits, most realize it is worth paying a solution provider to get that done for them, especially before their competitors do. That leads to solutions that have decent profit in them, which leads to well-compensated salespeople. The IT Solution Provider industry has some of the best salespeople of any field out there. If that is something you are interested in, here are a few methods that work for me.
First, it’s a technology field! You have to stay up to speed on the technology in your field of concentration, at least to the level of having a basic conversation about the benefits of the products and your company. On top of that, it is important to recognize opportunity, get the customer interested in your company, then communicating that opportunity back to the design engineers. There’s also a split between the type of conversation that leads to profitable business, and the kind that can generate interest.
I always like to start talking to the techies, because if you don’t, then when you talk to the managers who have the budget, the techies always find a way to cut your legs out from under you. To talk to the techies, it helps to have something new and interesting to discuss. That’s why it’s important to learn the basics, the history, and always be learning the new technology.
As a baseline, I define an IT Solution sale as composed of the following, all which require expert engineers:
- Assessment of existing system.
- Identification of needs and issues
- Design of system upgrade or new system installation
- Hardware installation
- Software installation, configuration, deployment.
- Professional installation and configuration services
- Training and system documentation
- Ongoing support
This tends to be an expensive investment for the customer, so there has to be a real need for the upgrade. To make profitable sales, you have to address needs. And if you can identify a need that is currently causing pain, even better. Unfortunately, if you are just talking technology that the customer implements themselves, it does not make very much money. In order to afford engineers that can put together a complex solution, the IT sales rep has to design the proposal to be profitable on multiple fronts. From a standpoint of profitability, the different elements usually balance out something like this:
- Hardware — 20%
- Software — 25%
- Implementation — 35%
- Training — 5%
- Recurring services — 15%
If you are just selling hardware, you have to sell five times as much as if you sell compete solutions! It is possible to do, but it is much better to look for complete solutions to sell. Besides, most customers want the benefits provided by the complete solutions, sometimes they just don’t know it at the start of the engagement. And if you are selling a solution, it is better to focus on items that have not become commoditized, because it is much harder to make money on them.
For example, when personal computers first came out, providers would sell a full solution around the PC’s, and would be able to make large profits on them. Nowadays it is almost not even worth selling the systems, because the profit margins are in the low single digits. It is much better to focus on new or specialized systems. Unfortunately it is really difficult to get in to talk to techies if your initial conversation is about a complete solution. You have to craft a few different entry points. The ones that work for me tend to involve a combination of:
- We have a new technology to introduce.
- We have a new product using new technology that can make things better for you.
- My organizations has recently successfully implemented a new product/technology at a similar type customer.
- In this technology area, we have knowledge, expertise, and experience. We have good local engineers proficient in this technology that can help you out.
- We are a leading solution provider for the vendor that makes this technology.
- Do you have a few minutes to meet to talk about how this technology can help make things better for you and your organization?
Once I get a meeting set up, I like to go through a very specific set of steps to create an opportunity:
- Talk about why we are there and that we will discuss the new technology.
- Create authority. I have to show the customer that I represent a company that is expert and experienced in the field.
- Frame the discussion. I want to bound it to areas that we are good at. Those are broad areas, but there are a lot of things in IT we don’t do, and it is important for the customer to know that up front.
- Talk at a high level about the different complete solutions we are really good at. Who knows, they might be interested in some of the other stuff we do.
- Give a highlight of the new technology, and how it fits in to the overall scheme of the complete technology solutions we provide.
Then it starts to become complex. During the next ten minutes to two hours of the discussion, I weave in and out of different topics, all with an end goal in mind. The different discussions encompass:
- How we take care of our customers with our team.
- Why we are good at what we do.
- Success stories of technology solutions implementations we have done for our customers.
- Finding out the customers needs and desires.
- Finding out the size, scope, complexity, budget cycles, project plans, and anything else relevant to how we can assist the customer.
- More information on the new technology, and how it may or may not apply to the customer’s operations.
There are many danger zones in this conversation, though. Be careful to avoid these types of actions:
- Identifying a customer need, then honing in on it and starting to sell to address the need immediately. This is a way to get a small sale and miss the big opportunity.
- Bag-diving. The customer says they are thinking of buying something, and saying we can sell you that, let me give you a quote. Very annoying.
- Acting like an inquisitor by firing off question after question and not providing any value. “I didn’t expect some kind of Spanish Inquisition…”
- Asking open ended questions that gets the customer talking about something that we completely can’t address. That is a waste of everyone’s time.
- Talk about things that are coming in the future. That’s nice, but it does not help the customer to address needs that they have today.
- Tell the customer they should do things. They don’t need some outsider coming in and telling them what to do! It is more productive to talk about how you know of other organizations that have had similar issues, and mention some ways they addressed those issues.
- Asking about problems or issues. How cheeky! Much better to ask if there are concerns or areas that they are looking to improve in the future.
- Acting like a supplicant. You are part of a leading technology organization and you have a multitude of value you can bring to the customer. Act like you have value.
- Act like a tourist instead of a salesperson. You are there to represent your company and find out a need that the customer has so you can sell them something that helps them out. If you don’t do that the customer will lose respect for you.
Is is very important to make this a useful back and forth discussion. The customer is usually interested in finding out how new technology has been successfully implemented at similar organizations, and how other organizations solve problems that they might have. They are happy to provide information about their organization and its goals in return. Customers have their areas of expertise, and the salespeople at IT solution vendors have theirs. Remember the advantages you have in the discussion. You work for an organization that:
- Stays close to vendors to determine their strategy and the direction of the industry.
- Sees lots of different customers who implement things both successfully and unsuccessfully.
- Can bring experienced engineering resources to bear who have a track record of success.
- Has a track record of success and stands behind the work they do.
- Can be blamed if something goes wrong…
The next part is critical, though. You need to elevate the discussion from technology and products to solving a need. There are usually plans, concerns, and issues. In your discussion with the customer, you have to both identify a concern and be able to present enough information about your organization that demonstrates to the customer that you represent the people that can address the need. When talking about those needs, you have to put yourself in the customer’s shoes and figure out what motivates them, and at what level it motivates them. IT people have a few basic things they need to accomplish:
- Keep the systems running.
- Don’t lose data.
- Make sure the company does not have security breaches or outages that are bad publicity.
Above and beyond that, they have other needs. Some are company needs, some are personal:
- Improve systems operations and help their company be more competitive.
- Update systems that are getting old or are underpowered.
- Operate advanced systems at the forefront of the industry.
- Do something that improves their resume and can lead to a raise or better job.
- Save money.
Most IT professionals do not put saving money at the top of their list, so it is not usually a fruitful line of discussion.
Assuming you are able to identify a need that your organizations can solve, then it is critically important to show how a complete IT Solution is the way to address the problem. Just selling some hardware or software and having the customer install it themselves is not a complete solution. Addressing the entire need with a proven package that you can bring to them is.
Even if they are interested, however, they still need to have a way to pay for it. That is where budgeting comes in. As one of my previous sales managers told me, a basic criteria for a prospect is that they have money.
Sometimes you get lucky, and you meet with a customer that has already decided they are going to buy something that your company is good at. Then you just have to show them why you all are the best, and why they should get the IT solution from you instead of their existing suppliers. This is where a good salesperson can make a big difference. It is also why repeatedly doing an excellent job for an existing customer is much easier than trying to find new customers.
If there is not an existing budget, then you can try to create budget out of nothing. Unfortunately, trying to create new a new budget allocation from scratch is a multi-year endeavor. A better tack is to find ways that existing budget expenditures can be redirected into a more useful way. If you can help the customer figure out how to get more bang for their buck, especially if it is by doing something shown to work in other places already, then that would be useful.
Sometimes, believe it or not, the customer might not have any needs at all that you can address! That happens occasionally. If so, I recommend you don’t try to force it. Tell them you will stay in touch and continue to bring them information about new solutions and successes that similar customers have had, and tell them you would like a chance to be their supplier of choice for something new that comes up in the future.
Furthermore, if the customer has show interest in any of the solutions that you discussed, but needs to wait until the next budget year, that is OK. Offer to provide them a budgetary price on the system so they have an accurate price to use in their annual budgeting exercise. It is important for your customers to have those types of things in hand, because it shows that they are prepared in case end of year money comes up, or something else unexpected happens.
If you do provide them that budgetary price, you may as well provide a financing quote for it that shows them what it would cost on a monthly basis. Sometimes when looked at on a monthly basis, especially when compared to other expenses, it looks like something that is realistic and desirable.
Hopefully, though, there is a need you can address. In the classification of needs and solutions, it is worth figuring out if you are offering the customer a vitamin or a painkiller. If the need you have identified is for a future project, or it is a planned replacement or upgrade of a system, it is a vitamin. Vitamins are kind of hard to sell, and it takes awhile. If, however, you have the ability to make their pain go away, then rejoice!
There is almost nothing more rewarding than having a substantive discussion with a customer, learning about them, explaining what your company does, then realizing that your organization has the capability to offer them something that will make things immediately better for them.
That’s just the tip of the iceberg regarding IT Solution sales methods, but it should be enough to get an aspiring account manager to get started. There’s lots of other tips, like do your studying and quote preparations at night, and visit customers during the day. But those fall into the category of more general sales, and there are plenty of books out there on that.
If you are able to become an effective IT solution provider sales rep, you will have practically guaranteed employability. It is a difficult industry to become successful in, but there is no other industry that changes so rapidly and provides so many different ways of bringing solutions to your customers.