Businesses talk a good game about the importance of the customer experience. But customer experience is an amorphous concept, while the bottom line is a number you can’t argue with. As a result, even as customer experience efforts get the press, companies are primarily focused on saving money by making internal processes more productive or by increasing the amount being sold to the customer. Unfortunately, many of those processes impact the customer experience for the worse.
There aren’t many areas in business where processes used to save money and maximize deal sizes also result in a better customer experience. A notable exception to this is configure price quote (CPQ) software. CPQ has traditionally been a go-to technology in custom manufacturing. However, as other industries have become more agile in how they sell and SaaS has helped bring down prices, CPQ has gained a foothold in high-tech, telecommunications, life sciences, and healthcare.
CPQ automates the process of developing custom quotes—providing workflows to guide quote creation, suggesting upsell possibilities and bundles of products, establishing discounting rules to protect margin, and putting the right content about products in sales reps’ hands exactly when it’s needed.
All those things result in a lot of positive effects for the seller, according to Aberdeen, whose 2013 report suggested a tremendous return on a CPQ investment. Companies using CPQ saw a 105 percent greater average deal amount than companies without it. Sales cycle lengths were 28.8 percent shorter, lead conversion rates were five percent higher, and margin protection was 23 percent better.
For sales people, the numbers were similarly rosy. CPQ solutions reduced errors on quotes by as much as 40 percent, allowing deals to move faster. Similarly, the average number of quotes per month per sales rep went from 14 to almost 21 per month.
These are all internal productivity numbers, you might say. As great as they may be, in the age of the customer, who cares about these internal measurements when we should be focused on the customer’s experience, not on that of our sales reps?
Well, here’s the good news: by creating a more frictionless buying experience, CPQ makes the B2B customer buying experience far better.
Let’s start with that sales cycle number. Part of the reason for that 28.8 percent greater sales cycle speed be attributed to automated approvals. This has a major upside for customers’ experience—sales reps no longer have to tell customers they need to seek approvals to finalize deals and then vanish for 24 hours. They can get a yes or no based on managerial criteria built into the CPQ solution. Instead of days, the wait is minutes. And if a deal can’t gain approval as written, it can be revised and resubmitted quickly.
Error reduction, as simple as it sounds, also enhances customer experience. It’s easy to make mistakes doing repetitive things like manually creating quotes, and every uncaught mistake has a potential detrimental effect. For the seller, a mistake can impact margin. For the buyer, a mistake can mean a delay in closing the deal. By automating many of the repetitive tasks, CPQ can squeeze out more errors and reduce customer frustration.
When reps can provide the right content right away, without a need for research on their own, customers are far more likely to feel informed about their purchases. The old way of doing things—in which reps offer to “email that stuff to you when I get back to the office”—simply does not fly, especially since it often leads to nothing ever being sent to the customer. The experience for the customer improves and his or her deal is more likely to close when the sales rep is seen as authoritative and organized.
The truth is, if your B2B competitors offer a more frictionless experience, your customers are likely to buy from them instead. By removing the friction from the deal, CPQ has the effect of not only making customers more likely to buy from you today but also to buy from you again in the future. Forrester Research found that 71 percent of customers polled said valuing their time is the most important thing a company can do to provide them with good service.
Using CPQ results in more time for your sales reps to sell and more time returned to your customers to do their jobs, too—making CPQ a potent customer experience secret weapon, not just a productivity and margin-building tool.
Want to learn more about CPQ as a driver of better customer experience? Listen to Forrester’s John Bruno outline the ways it makes life better for your buyers in our on-demand webinar.