A $700 million+ market with a 50% growth rate over the next several years, CPQ software is poised to explode like never before, which means one thing: intense competition and quick evolution.
Whenever an industry ramps up like this, it tends to take its best players along but leave a trail of carcasses behind. Those who will stay alive are those who can adapt quickly and have the expertise to stay ahead of the curve.
Sales cycles and product configurations are becoming ever more complex, and much of the CPQ software evolution in 2018 will be related to dealing with this increasing complexity. In short: the way we sell and what we sell changes every year. Today’s — as in 2018’s — sales reps and managers want omnichannel agility, real-time insights, cloud-based capabilities, and ever-more-intuitive interfaces, plus machine learning to get the most out of their data.
Here’s a quick look at the key CPQ software trends to watch for 2018.
1. The Cloud
According to Gartner’s Market Guide for Configure, Price and Quote Application Suites, cloud-based CPQ revenue is close to accounting for the majority of the CPQ market and is going to have double-digit growth through 2020.
The cloud is key to every CPQ-related endeavor mentioned here, but especially key to being able to scale globally and quickly and have greater control over security while addressing total-cost-of-ownership (TCO) issues.
Cloud-based CPQ systems enable role-based data access controls at the partner and role levels with far greater accuracy than legacy systems, and as things become more omnichannel (more on that further down) the ability to have role-based data access controls become paramount. Cloud-based CPQ systems also keep pricing current and updated across channels and touchpoints by integrating at the system-of-record level, which significantly improves accuracy and consistency.
In the cloud, CPQ systems become infinitely smarter and more agile, and also more secure. In 2018, the cloud will achieve dominance in the CPQ market.
2. Real Time
Admittedly, “real time” has become one of those buzzwords that’s now being so overused it’s practically lost its meaning. But the reality is that in the CPQ market, real-time capabilities have become essential and will really come into their own this year, in the form of widespread adoption and use.
What will be in real time?
Pricing, for one. CPQ systems now need real-time pricing that instantly updates globally across channels, devices, and sales teams.
Also product and service features. Your sales teams need to be able to be able to create custom configurations tailored to customers’ key attributes and needs with a single click. When you can update configurations in real time, your sales teams can instantly create accurate and fully custom configurations with any required feature.
Buzzword or not, real time is for real, so be ready.
3. Machine Learning
Arguably another buzzword but probably leaning more to the area of legitimate digital revolution-slash-transformation is machine learning. By now there are few industries that haven’t been touched in a meaningful way by artificial intelligence or machine learning, and the CPQ market is no exception. Clearly, many CPQ vendors are beginning to use machine learning to improve the effectiveness of incentives, promotions, and rebates across selling channels, and increase up-sell and cross-sell revenues.
When you can go from your brain and a spreadsheet to a machine, let’s face it: you’re making a step up as far as being able to effectively crunch data for brilliant insights that produce bottom-line results. This year, the machines are going to be doing a lot more work in the CPQ market.
4. Omnichannel agility
Establishing an omnichannel sales strategy has become a key initiative for most enterprises. As buyers increasingly expect their experiences to be fast and consistent and tailored to their device usage habits and preferences, it’s almost impossible to get away without omninchannel agility these days, especially in B2B environments. CPQ systems are key to achieving these initiatives, particularly through cloud enablement.
Every channel. All the time. Right now.
You know how it is with buyers these days. This will be reflected in the CPQ market in 2018.
5. Intuitive UI
CPQ systems have come a long way from their early days as far as usability, but look for this to become a top priority for sales managers in 2018. There’s just nothing better, for a sales manager at least, than a happy, smooth-running, glitch-free, low-turnover sales team, and an incredibly important tool for making this dream happen is a CPQ system with an extremely user-friendly interface and one that easily integrates with your existing systems. Intuitive workflows and mobile-first application design are particularly important, with so many teams making deals right from their smartphones. Expect 2018 to be the year of UI for CPQ systems.
With so much going on in the CPQ market, there’s no doubt this year is going to be big. But of course, every year is big in its own way for CPQ. Between machine learning, UI, real time, the cloud, and omnichannel abilities, CPQ is going to look a lot different than it does now by the end of 2018, and you can bet the changes are only going to help you ramp up sales and bang that gong.