Image for post: Summium Sales Configurator – Does It Have Value to the Customer?

Summium Sales Configurator – Does It Have Value to the Customer?

Article published previously on Wapice's Summium -product's blog.

Nowadays customer value is a hot topic in academic and in business world. And there’s a good reason for this because, as the competition increases in many industries, companies need to more accurately understand and argument what kind of value their product and service offering provides to their customers.

What is customer value?

According to one definition customer value is defined as ”a trade-off between a product, service, knowledge, time-to-market, social benefits and price and functional costs as perceived by the key decision makers in customer organization, when considering the next best competitive alternative.” In other words the benefits of a product, related services and a collaboration relationship minus overall costs as perceived by persons affecting the acquisition decision.

So what is the customer value of Summium sales configurator? In order for us to understand this, first we need to understand something about those business problems which can be solved by Summium.

What problems Summium solves?

According to our experience it is very difficult for companies to conveniently manage the sales of a complex mass-tailored product offering without a suitable tool. Many companies still use spreadsheet for forming product configurations and calculating prices, and they manually create commercial tendering documents with a copy-paste-method. This is very time consuming, it costs a lot and commercial tendering documents as well as prices often vary between sales persons. “Didn’t Jack make a similar offer last spring? - ask him” is a common comment in offer making process in many companies.

Even though spreadsheet is an excellent tool, it can be used only to a certain degree in managing product configuration and pricing information. When many of our customer’s business is growing, maintaining a complex spreadsheet has become an overwhelmingly too burdensome and risky job. And keeping a vast sales, retail and partner network informed about product and pricing changes is, to say the least, challenging. Thus people most likely will have different versions of the same documents, which inevitably will cause confusion and mistakes.

Without an illustrative tool in use, a sales person and a customer may not have a similar understanding of customer needs and the product being sold. Or then the sales person may have sold such a product which cannot be manufactured. In this case the customer is compelled to state that “this isn’t what I ordered”. If this occurs several times, it is not good for the collaboration relationship.

What value Summium brings to the customer?

So, how to solve these problems? We have a habit of saying that selling can never be made easy but buying can be made easier, and this is precisely what Summium does – it makes customer’s buying decision easier.

In 2013 we performed a market research concerning sales configuration market potential and customer benefits. We noticed that as the most important benefit of sales configurator companies consider deliveries which better match customer needs. Because, based on sales options, Summium automatically generates relevant pictures and documents, it visually illustrates the product configuration being sold. This in turn enables the sales person and the customer to understand the configuration similarly with each other. Additionally, it is impossible for the sales person to sell invalid products because the sales options only allow valid product and feature combinations.

According to this same market research companies consider flawless pricing and tendering documentation as the second most important benefit. Since Summium automatically generates pricing information and tendering documentation for the chosen product configuration, this information is flawless and homogeneous among every sales person. As a result, “vain” manual work is eliminated and thus offers can be given faster. An objective research organization has noted that a sales configurator like Summium enables sales person to send half the number of offers more than before, shortens the sales cycle nearly by one third, increases hit rate by one fourth and lead conversion rate by one fifth (Aberdeen Group 2013).

Many companies are perhaps unwittingly pondering how to solve many of the problems relating to the selling of mass tailored products. Since the utilization of sales configurator is part of modern business management and its benefits are so obvious, I feel justified of asking why any company would want to operate without such a tool.


Summium CPQ customer value marketing research

Author

Kai Huittinen

Consultant

Image of post author Kai Huittinen