The main difference between Cloud Computing vs Managed Services models is control over the data and/or processes required. The choice between these models depends on the type of technical service and software access \ support you need to most effectively support the profitability of your own business model.
Managed Services Model – You have specific servers and other components are assigned to you, and the provider is doing the things your IT department would do if you were sourcing the computing services internally: keeping hardware up and running, applying patches and updates, monitoring systems and keeping historical trend data for an increase in efficiency as it relates to a process. You still manage any applications running on the systems. There are typically service level agreements in place that support the managed services arrangement.
Add-on fees may apply as your usage grows. The per-server per-hour fee is the base with additions such as: internet bandwidth consumed, data storage, data transfer to and from storage, server CPU usage, server memory usage, backup frequency and size, etc. Some specialized Managed Service Provider can also be provide application support to perform functions on the hosted software cost plus.
Cloud Computing Models -
Cloud Computing is a buzzword thrown around loosely by different groups in the industry and can mean many things. A cloud computing arrangement is more of a subscription to use a tool available. Cloud comes in various flavors from least to most expensive for the value provided – IaaS PaaS, SaaS.
Infrastructure as a Service (IaaS) – This model provides you with access to virtual servers and networking devices but in many ways you need to manage them just as you would if they were sitting in your own data center. This is the least expensive option and provides the least added value. This approach is most like Managed Services model.
Platform as a Service (PaaS) – You get a specified configuration such as firewall, servers and load balancers that are managed by the vendor up through the level of the operating system. You need to install and manage any applications that run on top of the infrastructure.
Software as a Service (SaaS) – Vendor is managing the software application and typically provides a SLA for application uptime. You are responsible for the specific setup / configuration of the application and your business processes it automates. This model is the most expensive and adds the most value.
In each of the above described cloud environments, the application is often shared among multiple users – which leverages application \ data mgt across a broader base of users and lowers the individual user cost. This also requires careful attention to security, isolation and process for the specific cloud user \ usage.
The choice of what’s right for your company depends on the type of technical service and software access \ support you need to most effectively support the profitability of your own business model.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
In our April Blog ‘SaaS Shifting the Value Model’ we explored the elements of a successful
SaaS business model. The focus of this blog was effectively managing the Customer Acquisition Costs (CAC), Lifetime Value (LTV) and Churn in light of the longer term cash flow requirements of a SaaS model. As a result, SaaS model also requires us to make adjustments in the underling elements of the business operations - like sales, to effectively execute on this model.
SaaS sales strategy requires us to address the full life-cycle of a customer. SaaS should be
thought of as a service not a product sale. It is more about making your customer successful
by quickly engaging a customer and then extending value through increasing number of users and the number of valued uses of the service.
SaaS relies on a moving a large quantity of qualified prospects through the marketing and sales funnel at a low cost. Moving through the stages of Awareness, Evaluation, Contracting, Onboarding and Account Expansion as efficiently as possible by leveraging a ‘self-service’ approach and mitigating friction is critical to sales success. Additionally, appropriate sales structure, role specificity and allocation of resources to these unique stages allows for a more effective process.
Some key areas of focus should be –
• Maintain a demand generation machine focusing on qualified lead volume at lower costs.
• Actively use guerilla tactics which creatively engaging prospects.
• Focus on customers adopting the solution rapidly and with ease.
• Monitor the app to see who \ how it is being used to better understand behavior.
• Creatively engage users to test drive features which support these behaviors.
• Focus on up-sales of new features and licenses which enhance those valued features.
• Leverage customer satisfaction with their referral networks for more profitable viral sales.
• Financial and metric emphasis within marketing, sales and service stages.
As we can see, SaaS (Software as a Service) reshapes the business model requiring significant cultural change and alignment within marketing, sales, customer service, product development and operations to be successful.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
SaaS (Software as a Service) should be thought of as a business model rather than a pricing or a deployment methodology. A commitment to this business model also requires a significant cultural change when it is adopted within the firm which needs to be fully supported with an updated organization structure and resources to be successful.
SaaS should be thought of as an enhancement of the overall customer experience and lifecycle. To be successful, SaaS requires a more dynamic approach which involves moving a customer from initial product purchase to deeper use of product to advocacy within a community. This staged evolution is necessary for the profitable growth of a SaaS business.
Three critical metrics tell the story of a successful SaaS operation – Lifetime Value (LTV), Customer Acquisition Cost \ Rate (CAC\R) and Churn. The following discussion will describe why these metrics are business model ‘game changers’ within an organization.
Lifetime Time Value (LTV) describes the relationship and growth of purchases by the customer. It is critical that the customer sees more uses for the product and is willing to pay for the value of these additional uses over time. The increasing value of this customer over time, offsets the disproportional high early costs inherent in the SaaS model. SaaS companies breakeven periods average from 2 - 4 years (monthly pay model) prior to breakeven on a customer.
Customer Acquisition Costs \ Rate (CAC \ R) describes the investment required and the rate at which a customer is acquired. There is a significant upfront investment required in the development, distribution and support of a SaaS product which needs to be offset with a higher than average growth rate and a lower than average cost of sales. Reducing the barriers of product evaluation (Trial), initial product cost (Op Ex - Monthly payments) and onboarding (Plug and Play) are some of the methods used to drive more effective CAC\R.
Churn is the bane of a SaaS operation. It describes the rate at which customers are lost. Since customer breakeven may not occur until years 2-4, than all years prior to this are accumulated losses for the firm. The only way to appropriately combat churn is through effective LTV programs. The customer needs to see more value and uses for the product. Customer Service \ Support and Retention \ Loyalty programs must be viewed as critical profit centers of the business.
As we can see, SaaS (Software as a Service) reshapes the business model requiring significant cultural change when it is adopted within the firm which needs to be fully supported with an updated organization structure and resources to be successful.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
As business owners we don’t like it when someone asks for free services, our value is diminished. This is the hidden cost of free. Yet we continue to rationalize ‘free’ to enhance the value of our relationships, marketing and services.
There are several other hidden costs associated with free. The more you give away, it raises your costs resulting in increased prices to maintain profitability. Providing free in an attempt to get more customers often results in acquiring wrong clients and results in greater churn, increasing cost of sales to replace lost customers.
Time can be our most expensive cost. We waste time on one product vs another creating an
opportunity cost. Time spent in do-it-yourself (DIY) activities i.e. learning curves, entering data, customizing, lack of support \ maintenance etc.. also limits our productivity.
Unfortunately, we live in an environment where there is an expectation of free services i.e. open source software, digital products, personal email, social networking and various content \ news sites. They are provided by so many companies that we think of them as commodities. While in fact they are business models which trade free for other forms of value i.e. personal information, exposure to advertising or market validation.
Unfortunately, as consumers we also do not value our own time and efforts and trade it away as a commodity. We waste time learning these new applications, entering data, viewing advertisements, limited support etc… A user needs to appreciate the value of the information they choose to collect, share and view with service and how that information is going to be used to understand its hidden cost and associated value.
These various models exist to prove a market in the short term to validate a product and costs. Investors may support these models to enhance speed to market, reduce initial costs of entry and understand how to scale operations. However, in the longer term, return on investment through the value produced will determine ultimate success or failure.
Thus, the sustainability of any venture must depend upon the realistic costs of the operation, which certainly are not free, related to the value they provide and the consumer must decide
if ‘free’ really means ‘FREE’.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
We use content to acquire, grow, and maintain the prospect’s attention for the purpose of populating and perpetuating the pipeline. Content marketing is the process that gives organizations the ability to extend their sales-reach—to keep in touch (i.e. network, email, tweet, or just plain interact) with more prospects than ever before. Content-marketing helps to develop, maintain and move relationships forward until they are primed for a conversation with a sales rep.
Content-marketing is lead development not selling. You need salespeople to sell. And salespeople need their own content designed to support their selling process. They need content for sales call follow-up and for leaving voice-mail messages. They need customized presentations in various formats. And, they need content that makes their proposals stand out from the competition’s.
Content that is designed to convert opportunities into deals i.e. ‘Content-Selling.’ The need for content selling is particularly evident in complex B2B sales where sales cycles are longer and decisions are rarely made by one person. Long sales cycles consist of long stretches of follow-up and information-sharing, intermixed with relatively fewer occurrences of live conversations. In other words, a large percentage of a rep’scommunication is done through content.
Most organizations leave it entirely up to sales reps to produce the sales content they need. Studies have shown that the typical percentage of time a sales rep spends with a prospect is 35% The remaining 65% of their time is spent strategizing, developing, and distributing content of their own making.
This points to the need for a more institutionalized approach to content-selling. There are plenty of opportunities to apply content-selling that will leave more time for reps to hold quality conversations with quality prospects and at the same time ensure a higher level of effectiveness of sales content across the organization.
We can find these opportunities at many points through-out the sales cycle. Creating templated sales emails is a great example of where content-selling. Best-practice emails that can be shared across the team to be used at a moment’s notice. Think about the opportunities to create targeted content to address client value.
Content-marketing doesn’t go far enough into the sales process. There needs to be a well orchestrated symphony of content for both Marketing and Sales organizations.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
How can you sell value when your sales opportunities devolve into commodity based price wars? Information about your solutions and those of your competitors is available at the click of a prospect's mouse - every bit of information about your company and that of your competitors can be found on web pages, blogs, on-line chat groups, and tweets. Buyers know your best price for their required features and are prepared to bid you as a commodity against your competitors.
The answer is that there is one important and very real component of value among a buyer's decision criteria you can offer that is different - the salesperson. The person who's going to educate the prospect with the knowledge to make the best decision. This person is going to answer his questions, address his concerns, remove uncertainty, and make them feel more confident of their evaluation.
People really do want to buy from people they like and trust and therein lies your opportunity to positively differentiate your offering. Because in addition to the hard, factual evidence all vendors present, a prospect will, throughout a sales process, consider softer factors which affect post-purchase issues; continued reliance for service, dependability for delivery, responsiveness of communication, access to information and resources i.e. providing value.
Sales persons can look through their opportunities and be better at providing value throughout the sales process. By committing to value and delivering it you have created an experience in the prospects mind of how their experience will be post purchase. Thereby establishing the needed trust and credibility to differentiate yourself and solutions.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
I would like to take the liberty and provide some insight based on our experience with firms who have had issues with one CRM and are transitioning to a new CRM. Certainly, functionality enhancements or service considerations are constructive and can provide a positive leverage for marketing, sales and service operations.
However, in our experience a firm rarely uses even a small percentage of the enhanced functionality it originally evaluated or upon which it made a purchase decision. Effectiveness and adoption of the tool depends primarily upon if it was customized to the way the specific firm does business and how
its sales persons operate.
You have two choices – change the way you work to suit the tool or change the tool to the way you do business. No tool, no matter how custom to your industry, comes close to mirroring your own business processes \ people. A professional services engagement will be required to meet your needs. Not only will the technology need to be customized but most often the business processes and personal behaviors which drive the software will need to be analyzed, optimized and documented for this customization.
Thus, any professional services organization who will provide these customizations needs to have both the subject matter expertise to defined the appropriate processes and the technical expertise to modify the software. It is often these customizations and services which had limited the first difficult CRM purchase and we hope to avoid in the current purchase.
When this realization of required customization is recognized, the question consistently comes up should we – Buy an off the self-software and pay for customizations or should we Build a custom solution in which we have ownership. Many factors influence this decision and they invariable fall into a traditional risk reward matrix which hinge on total cost of ownership and internal resource requirements.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
Today’s access to information is greater than at any point in history and access to
information is growing at an ever increasing rate. This growth in data and access
is changing all aspects of business and society. The Marketing and Sales function
is not immune to this transformation.
The last 10 years of selling has been driven by consultative selling methodologies .
The premise of these sales processes has been to ask questions to better understand
our clients and align our solutions with those needs. Clients relied on the sales person
to educate them on how solve their problems.
With the growth of information, clients are now better armed about their own problems
and how to solve them. Studies have shown that clients have completed 70% of the
problem diagnosis and solution development prior to any contact with a vendor.
The new approach .. today’s salesperson has to provide foresight in to problems that clients
didn’t know that have. They need to be teaching clients new ways to make and save money
even prior to their clients understanding of these issues. Sales people need to be educators
and be able to engage and challenge buyers before their own buying process starts.
This new approach to sales is transformative for both individuals and organizations. The
organization needs to support marketing and sales with new and insightful data driven
information around their solutions. Additionally, these messages need to be packaged to
allow for the most effective consumption by their target market.
Individuals need to be recognized as experts in their field to communicate these new ideas.
They also need to be confident in communicating these new and sometimes provocative
concepts and not be afraid to challenge the clients current thinking.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
The most critical issue associated with CRM Adoption as with any new software platform is managing the change it represents to the user.
Most CRM software require a significant behavior change. Current behavior and tools usually involve Spreadsheets, ACT! or MS Outlook – Email, Calendar for the most basis CRM functions. So it is important when making a transition to a new software tool \ CRM to create as little interruption in these past behaviors as possible. Selection of the most appropriate a CRM which adds value and also most closely matches the current state of behavior is a significant goal.
We often hear that “It has to be easy or no one will do it” when referring to using a new software application. When digging deeper we understand this to mean. It has to be easy, meaning not involve much of my time and It can’t require any duplication of effort.
We have seen adoption rates skyrocket to 80-90% when a new software functionality can be integrated into a previously adopted platform.
We believe that leveraging an existing ubiquitous platform like Microsoft Office \ Outlook which integrates the CRM functionality is one of the most effective ways to help with adoption. The trick is to be able to customize the system in such a way that the user does not have to go into the CRM system itself and can access all (most) of the day-to-day data entry functionality in a drag and drop approach from the comfort of their email or calendar.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
Customer Relationship Management (or CRM) is back! What a difference a few years makes. Not too long ago, surveys were reporting that 70-80% of all CRM initiatives failed. That was yesterday. This is today. While CRM implementation results leave a lot to be desired, it is amazing what can happen when best practices and best features are leveraged to build a successful system.
In our experience the critical items are as follows –
Ease of Use \ Adoption - Is the system easily used by salespeople in the context of the tools they are already comfortably using to do their jobs effectively. Traditionally this means seamless integration with Microsoft Office and Outlook - Email Tasks and Calendar?
Customization - Can the system (i.e. imports, data fields, reports, workflows) be easily configured by an internal business analyst (with a little training) and not be dependent upon an application developers for updates and maintenance?
Automation - Does the system have a set of built in tools (Business processes, Workflows) which can intuitively be used by an internal business analyst to template repeatable business processes?
Full Customer Life Cycle - Do the features \ modules of the system provide a ‘cradle to grave’ approach to appropriately handle your approach to Marketing (Awareness), Sales (Acquisition) and Service (Delivery) for your solutions?
Reporting - Can the system easily generate reports from the data captured which allow you to make the best business decisions today with the available information?
Flexibility to deploy \ Integrate - Does the system have the flexibility to be implemented in various deployment models to match your business and technology – SaaS \ License, Cloud \ On-Premise. And do these implementation approaches leverage the ability to use the system in an integrated manner with your current technology investments?
We hope that you can use this review when evaluating the best CRM system for your business.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
How many of you have a mountain of business cards waiting to be scanned or
manually entered into your contact database? Data entry is the most significant issue
with CRM / SFA systems to work effectively. Sales people will just not enter data, period.
A QR code on every business card or appropriate document / email can help solve this issue.
A QR Code is an encoded image with information, i.e. vcard, which can be read by a phone app.
I-NIGMA - http://www.i-nigma.com/CreateBarcodes.html is just one of several standards
based QR Code generators and readers. AT&T states that this is software the most widely
supported from phone device and operating system. Check your own phone specs.
Step One – Generate a code (image) for your vCard. (See Above link)
Step Two – Copy and paste the code onto any document / business card.
Step Three – Download a QR Reader to your phone. (See Above link)
Step Four – Open the app on your phone and take a picture of the image on the document.
Step Five – Save / Synch to your Contacts.
After initial set-up, it takes less than five seconds to get a card saved to your database.
This is a huge issue for every sales person and anyone who has to manage multiple contacts.
Let’s create a groundswell so that every business card will have a QR Code in the very near future.
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
Pipeline Activity Metrics are critical i.e. Calls, Appointments, Proposals - sales is somewhat of a “Numbers Game”. Yet smaller firms in leaner times with more focused sales operations need early indicators that sales people are working the right deals. The firm must be very careful with effective sales resource utilization to ensure the profitability of marketing and sales operations.
The success metrics of working the ‘right deals’ are represented by – Faster sales cycle, Higher revenues, Lower cost of sales, Higher Profitability and Greater Lifetime Customer Value. We all want this! So what is the rub.
Traditionally - Marketing and Sales are not compensated on these metrics and thus quantity often wins out over quality. Yet as we change our compensation focus on these metrics we often shoot ourselves in the foot by being too selective too late in the process. We need to reach a balance between quality and quantity. By providing an indicator as early as possible in the process helps everyone manage themselves more effectively.
Initially it is Marketing and Sales responsibility to get on the same page to define what target segments and the related data elements in these sub-segment defines a good lead. Historical data captured by a SFA / CRM tool is critical to understanding which deals best aligned with successful Marketing, Sales and Service processes. Additionally, as the deal progresses through the sales funnel additional data elements should be collected which further qualify the deal.
Lead scoring is a process of rating a lead on these initial data elements as the lead is identified and at each sales stage it progresses through to determine the best fit moving a deal forward in the defined marketing and sales process.
Additional details and documentation on Lead Scoring can be found at Eloqua -http://www.eloqua.com/resources/
For more information on integrating marketing, sales and customer service to drive the greatest lifetime customer value, please contact us at info@bb2e.com or visit us at www.bb2e.com
My guess is that no one wants to relive last 18 months of sales data.
However, some reports are necessary just to see where we have been
and try not to re-live history. CSO Insights - Sales Performance
Optimization Study Overview is out and available on our website.
The study overview shows:
- Significant decline in sales quota attainment from 58.8% - 2008, 51.8%- 2009.
- Win rate reduced to 46% which was second lowest in study history.
Cost cutting was utilized to maintain some levels of success:
- Lead generation spending did not keep pace with sales
- Sales training reduced 13%
- Sales optimization tools tabled
Positives -
- Time spent selling increased 43%- 2008, 47% - 2009
Our general comments on the past 18 months are 'back to the basics'.
- Build relationships and processes concert with customer buying patterns.
- Support sales with the appropriate resources required to attain goals.
- Measure and compensate sales based on realistic understanding of above.
Additional sales report details and documentation can be found at
CSO Insights - http://www.csoinsights.com/
For more information on integrating marketing, sales and customer service
to drive the greatest lifetime customer value, please contact us or visit
www.bb2e.com or info@bb2e.com
Executives are paying more attention to customer service in an effort to increase sales and gain market share in the economic recovery. Customer service can be a growth engine for a company in a world where marketing dollars and credit is constrained.
Where marketing and sales budgets are being cut, customer service might be the most effective area for increased funding as the economy recovers. Customer service should dedicate more of their efforts to the customer segments considered most lucrative and bolstering customer service operations in an effort to retain customers and sell higher-priced services. Opportunities to pitch related services, cross-sell and up-sell rather than rushing off a call may be the best way to gain growth and revenues.
Also service representatives might be better coached on expanding relationships with customers. Call-center agents might focus less on resolving calls quickly, and more on building customer loyalty. More loyal customers will spend more money.
For more information on integrating marketing, sales and customer service to drive the
greatest lifetime customer value, please contact us or visit www.bb2e.com or info@bb2e.com
Does developing a qualified pipeline of prospective funders differ
greatly from developing a qualified pipeline of prospective customers?
Granted there are different profiles, needs, methods of access and pricing. However, these are still the same 4 Ps an effective marketing / sales operation manages daily. A firm would have to address these very same issues if they were moving to a different product / service or territory.
In fact, the opposite may also be true - the more sales people saw business development as capital raising the more diligent they would be towards partnering with the most appropriate customers to grow their business.
In sales, we often say that it is easier to get new sales from existing customers than to attract new customers. Thus, it is also true that to attract capital it is easier to access people who you know and trust you, your services i.e. customers to become investors. We should all start with the premise that all qualified customers also have the potential to be investors.
This joint approach to raising capital and sales / business development may be the most sustainable strategy to meeting both goals.
For more information on targeting the right service for the right market please contact us or visit www.bb2e.com or info@bb2e.com
The Holy Grail of Social Networking ROI is establishing a direct connection between an individual’s posting / response activity on a social site to specific leads in your contact database.
i.e. Joe Smith and others are identified in a firm’s contact database. He and others in a market segment are targeted with a defined message based on their profile i.e. uses Linkedin Groups interested in CRM issues. A social media message is posted on a LinkedIn CRM Group. Joe responds with specific CRM comments. Those comments are tracked and linked back to Joe Smith in the firm's contact database. Joe becomes an initially qualified lead based on his responses.
This approach is very similar to the Email marketing ROI model which has gained significant industry acceptance. The main difference is that responses to email messages are directly traceable back to an email address and easily linked to a contact record in a database. Current text analytics now allow us to gather very specific social networking posting data which can be pulled into a CRM and linked to contact records.
Other less defined methods of measuring quantitative Social Networking ROI are -
SEO rankings - Enhanced search engine visibility leading to greater site traffic
Tools - Google Analytics,. Feedburner
Traffic site – Increased visitors to your site
Tools - Web Trends, Google Analytics, AidRSS
Co-Registrations - Signups
Tools - Website contact forms / Email newsletter registrations / White Paper download / Demo sign-up
Conversions / Sales – Revenue
Tools - eCommerce
For more information on closing the critical the loop in social networking ROI please contact us or visit www.bb2e.com or info@bb2e.com
The future of e-commerce can be strongly linked to social networking and word of mouth marketing. Consumers have the power to advocate brands through user-generated reviews, social networking sites and interactive advertising content like online videos.
You need to engage your customers in a dialog, so that they get used to hearing from you. Give them the option to create user reviews on your Web site, and be proactive and follow up with an e-mail that will encourage them to continually participate.
When customers get used to conversing with you, then they will be likely to write about their positive experiences and your site will not just have bad reviews. Eighty percent of reviews are positive, because consumers want to participate in a network and trust hearing from each other more than from the retailers.
But it’s not just about good reviews. Bad reviews help determine bad products and identify poor quality. Firms should remove products that continue to get bad reviews. This proactive approach allows a retailer to add value to its customer and reduce non-turning inventory.
Not only are user reviews beneficial to customers, but social networks like MySpace and Second Life allow for products to be engaged more deeply and give brands a life of their own through community.
Brands that will survive are the ones whose consumers tell the story of the brand to each other instead of the brands telling the consumers their story. The great thing about social networks is that they also create distribution around the Web for you, and they validate the brand to other people. Kids were integrating viral video campaigns into their own online identity and this gives the brand a greater level of authenticity.
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More discussions and research on social networking, ecommerce and integrated sales and marketing programs can be found at www.bb2e.com/resources.html