Teleprospecting Resources can Successfully Manage Public Relations Engagement for Enterprise IT ISVs

Where possible, enterprise IT ISVs should maintain teams of trained telemarketers. We have often alluded to these specially trained telemarketers as “teleprospectors.” The objective of teleprospecting is clearly to gather as much information as possible from opportunities to engage with the public over telephone calls. This objective contrasts with the usual objective of telemarketing, which amounts to securing the agreement of the other party on a telephone call to purchase a product, or to sign up for an event, etc. Teleprospecting not only works very well for sales leads development for enterprise IT software. This activity also works well for software companies that need to do an effective job of managing public relations.

We think it makes sense to include teleprospectors in a public relations team. When teleprospecting is applied to the overall task of managing a business’ public persona, the activity can produce useful information on a variety of points, not the least of which (in terms of importance) amounts to an estimate of marketplace visibility. For some ISVs, opting to operate under the radar, the purpose of implementing teleprospecting within a public relations function will be to ensure complete marketplace opacity. For other ISVs, the same function can be highly useful to ensure that message and brand are familiar to an appropriately sized, and positioned segment of targeted markets.

With specific regards to ISVs that opt to use teleprospecting for this latter purpose, in other words, to ensure that targeted levels of transparency are achieved by public relations efforts, we highly recommend that a representative sample of targeted markets provide the pool of contacts for the teleprospecting function. Putting together this representative sample does not require purchasing a potentially expensive method of building statistical accuracy. Rather, operating off of an accurate list of prominent prospects — specifically picked to represent each important level (small/medium/large) within targeted markets — should suffice for a successful effort.

Once groups of contacts have been collected as useful samples, then teleprospecting efforts should be designed that can be successfully used to obtain marketplace information on enterprise software product visibility, as required. In this manner the teleprospecting effort amounts to an outbound effort to engage with the market. Of course, as needs arise, the same team can be used to respond to incoming requests for contact. Finally, the same team can be used to quickly determine market sentiment about changes in products.

It is likely a given, but nonetheless worth stating here that ISVs with an accurate familiarity with their public persona should be better equipped to predict business performance than their counterparts that lack this information.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Enterprise IT ISVs should Engage with the Public to Manage Market Message, Brand and Reputation

On December 7, 2012 we published a post to this blog, Cloud Service Providers Scale Back Features to Reduce Operating Costs. The position that we presented in this post was that a combination of at least two factors:

  1. transitioning cloud service subscribers from a free to paid feature model along the lines of a Freemium Business Model
  2. and, consumer-driven pricing pressure, which is typical of markets for commodities

had produced some impediments to cloud services providers in the public relations area.

In our opinion, both of these factors (in some fashion) have contributed to public perception of clumsy progress on the part of a number of cloud services providers as they look to extract more revenue from subscription offers. Our post mentioned two of these providers (though we need to note here that the issues we raised appear to us to be widespread across the industry) Salesforce.com and LinkedIn.

On December 14, 2012 Ira Michael Blonder, who writes this blog for IMB Enterprises, Inc. was contacted directly at our corporate telephone number by a contact at Salesforce.com. This contact requested a telephone call to collect more of Ira’s opinion, as well as to discuss the point further.

While we have some concerns about how this type of outreach could transpire, if handled ineptly, we generally think engaging with the public is a good idea for any business with a subscription revenue model looking to better manage its message, and, therefore, its brand.

Public misunderstandings about products, policies and/or terms, should be clarified as quickly as possible. Further, the public should be engaged to sample opinion as to how feature changes have been received. These conversations should be communicated back to product management to ensure that marketing communications messages have been optimized, and stay that way. As well, product management should analyze these conversations to gauge likely public reception of product offers, policies and terms and recalibrate, as required.

Our judgement on the value of Ira’s conversation with the above mentioned contact from Salesforce.com is positive. This contact adhered to the type of etiquette that we think needs to be exercised over this type of engagement. In fact, we had not published anything untrue, therefore, there was no effort made on the part of this contact to request a retraction of our post. Rather, the telephone call was used, correctly, to gather additional information about an opinion that we had opted to voice publicly, via our post. At the same time, the occasion of the call was used to provide us with some additional important details, ostensibly to help us reconsider our opinion. Both of these points make sense to us. We think other cloud services providers should think about implementing similar efforts.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Marketplace Sampling Efforts Need to be Carefully Designed to Provide Ongoing Accurate Results

When an enterprise IT ISV public relations effort is equipped with a teleprospecting function, this function can be used to regularly verify the level to which products, and even a brand name are visible within targeted market segments. However, to ensure that the information produced by this type of telephone contact function is as accurate as possible, we think it makes sense to design these campaigns around broad benefits, features, and the actual historical performance of a brand than to do the same around the product brand name, or the company behind it.

The difficulty of building these public sampling efforts around the familiarity of targeted markets with products and manufacturers is that the effort becomes, over time, self serving, and, therefore, inaccurate. On the other hand, when the topic of discussion is a specific benefit that can only be achieved, within a reasonable doubt, with a handful of products, including one’s offer, then the results can be highly useful.

A side benefit of this type of teleprospecting campaign design is that the public relations function should be able to use the results of the campaign to inform product marketing about the likely level to which targeted markets have received the correct message about products. If the data indicates that the markets are not receiving the right messages, then product marketing (via the enterprise software marketing communications effort) can adjust, as required.

It should be obvious that receiving this information about market sentiment as early in a product life cycle, as possible, makes sense. After all, why should enterprise IT ISVs sit back and wait to collect incoming market reaction to products? As we have written at length elsewhere in this blog, in 2013 enterprise prospects will likely engage with vendors only after completing extensive product research. Therefore, waiting to receive marketplace contact, which will, in all likelihood, only occur once prospects have selected one’s product for further inquiry, can result in an unsuccessful effort to launch a product — a potentially disastrous event for very early stage ISVs.

It is, therefore, much better to design useful campaigns around discussions of targeted benefits with marketplace participants. Where possible, these campaigns must commence right after products are launched, and be maintained as a regular, funded activity, throughout the entire early stage of a product launch. In turn, other types of public relations efforts, like seminars (or webinars), can be designed around the same topics to act as a stimulus of incoming engagement with the same cross section of marketplace participants.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Once Qualification Criteria have been Established Lead Generation Efforts Should be Separated from Sales Efforts

Product marketers for complex software products targeted at enterprise customers need to provide sales and lead generation teams with a prospect profile. These teams need to use the prospect profile to build separate prospect qualification procedures. The rationale for separating these procedures is that each team has a different, but complementary, reason for qualifying prospects. Lead generation teams should qualify prospects to ensure that names passed along to sales teams for further engagement meet the right prospect profile criteria. Sales teams should qualify prospects to determine where a prospect fits in, if at all, in the decision making system for an enterprise that looks like a potential customer.

It should be clear that we are proposing two different sets of activities from the same prospect profile information. The first set of activities are the domain of lead generation teams. These teams need to use their efforts to identify specific contacts with whom sales teams should engage, in order to advance the possibility of sales opportunities. Further, lead generation teams need to also collect information about specific enterprise organizations, to determine whether specific organizations exhibit the earmarks of good sales prospects.

In fact, as we see it, a prospect profile for complex enterprise IT software products has two core components:

  • a set of contact profiles and
  • a set of profiles for organizations likely to benefit from products

We think that it is clearly the responsibility of lead generation teams to implement both of these profiles. Lead generation teams should use both of these profiles to provide sales teams with opportunities for engagement. Sales teams, in turn, engage with these contacts to further the qualification process. The border between the two teams should be an initial meeting between the sales team and the contacts identified by lead generation teams. Like runners in a relay race, this first meeting provides an opportunity to “pass the baton” from one team to the other.

We have serviced clients as both a lead generation service and a sales service. In two recent instances we have performed both functions. We think it works better, as we mentioned at the start of this post, to keep the two activities entirely separate. Our clients benefit more when we pass a qualified prospect along to a sales team. Of course, it is then up to sales to determine the quality of the opportunity. Sales’ determination can provide a useful method of determining whether or not objectives have been met for a particular project.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Partnering with Core Application ISVs can Open Opportunities to Engage with Enterprise IT Decision Makers

ISVs offering what we refer to as peripheral solutions to enterprise businesses can experience substantial difficulties as they seek to engage directly with decision makers. Purchases of these solutions are usually invisible to decision makers as the result of two rather obvious factors:

  • the impact of the cost of acquiring these solutions is considered insignificant and
  • the requirements for these solutions often arise independently of requirements for corecomputing platforms

As we have argued in the last couple of posts to this blog, it is likely much easier for these ISVs of solutions on the periphery of enterprise IT computing to gain renewals on subscriptions where decision makers are aware of the solutions and engaged in the successful implementation of them as components of an enterprise-wide quest for value. Nevertheless, as we have just noted, most of the time engaging with decision makers is a very difficult challenge for ISVs of peripheral solutions. The end result is a difficult tone to year end where the sales team is out in the market with crossed fingers hoping that customers will opt to renew, despite a lack of support from decision makers.

A cure to this malaise is to joint market with ISVs of bigger solutions. If our readers need to be convinced on this point, then we recommend that they simply consider that the cost of these bigger solutions is always a matter with high impact on enterprise business decision makers. Further, implementing bigger solutions requires changes in operating procedures across an enterprise. Based on these two conditions it is safe to assume that decision makers will maintain focus on requirements for these bigger solutions.

The task for ISVs producing peripheral solutions is to identify likely partners who will require peripheral solutions to ensure that their customers can successfully implement their solutions. Success in this setting almost always amounts to implementing a solution that will produce a lower cost of business operation. Cost savings should be understood as largely synonymous with the concept of value for enterprise IT businesses.

We participated directly in the successful efforts of one ISV with a peripheral solution targeted to enterprise businesses. This ISV had a solution that permitted enterprise businesses to purchase very costly document production equipment. Specifically, enterprise businesses could use this ISV’s solution to spread the cost of this costly document production equipment across a wide range of computing systems, including a mainframe, work place computing and standalone personal computers. Our partner in this solution was a small company by the name of Xerox. If you care to hear further about this specific success story, then please use our contact form to submit your request.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Opportunities to Engage Directly with Decision-Makers Must be a Priority for Enterprise IT ISVs with Recurring Revenue Product Models

As we wrote in a prior post to this blog, enterprise IT ISVs with “razorblade” products built to produce a healthy recurring revenue from the periodic replenishment of the “non durable” component of the product (which is usually length of access via a cloud or software as a service, SaaS, subscription) must engage directly with decision makers. The reason for this imperative is that successfully capturing service renewals becomes a much easier task when decision makers are correctly engaged from the start of a sales plan. Lots of sales trainers have admonished their students to meet this imperative; therefore, we are not making our claim in a vacuum. The facts are that the perspective of operational personnel as regards costs, benefits, savings, etc. are very different from the perspective of decision makers who likely own budgets, and, therefore, manage capital outlays with utmost care.

We know of three different methods of producing this type of engagement very early in a sales plan. The first method is to implement what is often referred to as a “diagnostic” or “deeper dive” activity with a prospect. The purpose of this activity is to collect all relevant information about a prospect’s needs, ostensibly to determine not only the factors that a prospect is looking to change, but the severity of these factors, which most sales trainers agree will permit sales teams to estimate the likelihood of a sale. The general rule is that the more severe the factors, the greater the likelihood that a sale will be made.

Of course, the details that emerge from this “deeper dive” activity more often than not will include identification of decision makers as well as the roles of other important contacts in a purchase decision. Where factors are severe, in our experience, there is a greater likelihood that prospects will acquiesce to including decision makers in a discussion. But for products that sit on the periphery of larger applications, it is often very difficult for sales teams to get prospect commitment to engage in a deeper dive, especially in 2012 where prospects have generally accumulated all of the information they require about meeting their needs before they contact sales.

In these cases we highly recommend identifying other contacts within the same organizations. In other words, while an initial sale is in process, lead generation teams are using techniques like teleprospecting to engage with other contacts at the same business. It is much better for this process to be effective not to link the two activities. In other words, we recommend that sales teams continue to execute on their sales plan with immediate prospects independent of the activity of lead generation personnel. Over time, a map of decision making for the enterprise should emerge.

The last method is simply to use renewals as an opportunity to engage with decision makers. In our experience, prospects are much more open to identify decision makers post sale than is usually the case while the sales plan is in process. Of course, it is much more difficult to engage with decision makers after the sale has been made, but in some cases there is simply no alternative.

In the next post to this blog we will look further at how ISVs of peripheral products can leverage partners to get to the same aforementioned decision makers.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Any Opportunity to Include Decision-Makers in a Sales Plan for Enterprise Software should be Acted Upon

Sales teams representing enterprise IT ISVs need to act on any opportunity to include decision-makers in their sales plan. It is is easy to be lulled into skipping this critically important step. Here’s an example: sales receives an incoming inquiry from a user at an enterprise organization. This user, as it turns out, is looking to implement a specific solution like our ISV’s product. The user has gone through a preliminary step of gaining management approval to purchase some solution to meet his/her requirement. Therefore, from this user’s perspective, the next step is simply to gather all of the information required to make an informed decision as to which product will best meet the objectives of the requirement.

In 2012, the user depicted in our example usually doesn’t even need to reach out to sales at any point prior to placing an order. In fact, our ISV, like all of its competitors, has exposed lots and lots of informative content about its products, clients, testimonials, etc on its web site. Even more, pricing information is included in this material. The result is that our user knows just about everything, without any required contact with sales.

Once the inquiry finally comes in, the purpose is generally to shop the product, or, often, to place an order. Our sales team may try to slow down the process, in order to collect a lot of information about the user, his/her application, why the purchase was likely approved, etc., but our user may have very little tolerance for the efforts of the sales team to slow things down. After all, our user already has all the answers to the qualification questions he/she required to determine the set of products that would likely meet the requirement, which, in turn, needed further review. Our sales team will likely back off of its requests and assume the role of order taker.

If our ISVs product is a cloud offering with an annual subscription, it may be literally “up for grabs” as to whether or not our user will renew the enterprise subscription in year two, or not. When our sales team makes the attempt to secure an approval to send an invoice for the renewal charge, the response may be something like “I love your content, but I’ve moved onto another set of tasks and management has turned down a request to renew even though the team that took over for me would certainly benefit from a renewal”.

In fact, our sales team laid the groundwork for this problem way back when our user placed the order. It would have been much more fortuitous to push our user prior to accepting the original order. In the next post to this blog we will present some of the technique that we exercise to get the actual decision-maker included in the discussion.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Without Contact with Decision Makers Annual Attempts to Land Renewals on Subscriptions are Less than Likely to Succeed

Most ISVs have an objective of establishing a recurring revenue model. When the end of a business year rolls around, these ISVs actively reach out to their customers to hasten subscription renewals. We think most of these ISVs would do better at this type of task if sales management approached the job as an ongoing activity. The best time to start this ongoing activity is in the first month of the subscription; rather than at the last minute prior to expiration of a subscription.

Where enterprise business and other large organizations in the public and not-for-profit sectors make up the customer profile, the challenge of successfully mounting this type of campaign is particularly difficult. The reason for this difficulty amounts to the fact that sales can be made to these customers without anything more than tacit participation from true decision-makers on the purchase. When these complex sales occur, ISVs can often make the mistake of confusing the contacts who simply place the order with these hidden decision-makers. We regret to say that the two are rarely, if ever, the same. When this kind of mistake occurs, the sales teams at an ISV often receive some type of response like “I’m using your product and love it, but I don’t make the purchase decision. My management made the decision to terminate service as of the end of this year, sorry to say.”

In fact, the sales teams have received this response from contacts who, in all likelihood, have been “nurtured” along, periodically, throughout the period of time represented by their subscriptions. Therefore, sales management becomes perplexed, and hard pressed to identify the problem. After all, “we did everything correctly”, but still lost the renewal that we thought would be as hard to get as the task of “taking candy from a baby”.

The only problem is that these sales teams nurtured the wrong contacts. In fact, the users who requested funding to purchase a subscription may, in fact, have been motivated by simply a technical challenge, and not a bleeding wound in the form of a cash drain springing from a very high set of costs as regards systems development and management. No one in sales made the effort to reach out to the contacts responsible for these bleeding wounds, and, therefore, the seats belonging to contacts with the authority to authorize renewals, and more were never filled.

This whole process would be more predictable, and, in fact, easier, had the extra effort been made at the start of the sales effort to ensure that actual decision-makers were included in the discussion.

In the next post to this blog, we will look at why it makes sense to interrupt the natural flow of a sale to ensure that decision-makers fully participate in a purchase decision.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Dell Implements an Acquisition Strategy to Fundamentally Transform Its Business Model

As we wrote in the prior post to this blog, “ready, fire aim” as a product development strategy should not be applied to fundamental transitions in a business. “Ready, fire, aim” is a method of entering markets, and, subsequently, effecting very rapid changes in product design. Doubtless, an approach like “ready, fire, aim” can be very effective for product development as it permits businesses to enter markets very early, albeit with some risk to brand should early version of products fail to meet minimum levels of satisfaction in a market.

The key objective that should drive a decision to implement “ready, fire, aim” is timing an entrance to a market. With particular regard to technology products and services, it is generally advantageous to enter markets early. Further, it is generally the case that early entrants to markets for technical solutions are harder to displace by competitors who arrive later. Therefore, “ready, fire, aim” is a sensible approach to the right set of opportunities.

Making fundamental changes to what you sell does not constitute a right opportunity to implement “ready, fire, aim”. On the contrary, it is critically important that this type of fundamental change be carefully thought through, with especial care to consider the negative ramifications of mistakes. We treated some of these points in the prior post to this blog. For the remainder of this post, we think it will be useful to present our view of what Dell is up to with its recent set of acquisitions, given its intention to transform its business. We do need to note that we do own shares of Dell stock; therefore, we have an interest in Dell succeeding at its strategy. The reader has now been warned.

In fact, Dell is looking to make the same type of fundamental change in its revenue model that we have presented in these recent posts to our blog, albeit at a much bigger scale. We are focused on emerging tech businesses. In contrast, Dell is a mature, publicly traded businesses with a major presence in the markets for hardware products like desktop computers, servers, networking devices, printers, backup solutions, and more.

Back in 2007 Dell publicized its intention to enter other markets, namely the solutions markets for enterprise business (we are using this label to include public sector organizations of comparable size, as well as comparable size organizations in the not for profit sectors) needs for software solutions, and, integrated solutions that include hardware and software components, together with the specialized expertise required to put all of these components together into a working system.

Over the last four years Dell has consistently executed on this strategy, albeit with a level of positive effect on its bottom line that has not meant with widespread approval from the investment community. It is not our intention in these posts to opine on why Dell has only marginally benefited from these acquisitions; rather, we make reference to Dell as an example of why a business should consider buying its way into a market, rather than trying to build a presence from ground up. We think Dell’s plan makes sense, and, further, constitutes a safer method of fundamentally transforming a business revenue model.

In the next post to this blog we will look at a typical problem area that can stymie a business looking to buy its way into a market — assimilation.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved


Entrepreneurs Need to Carefully Plan Significant Transitions Between Types of Products

We have written frequently to this blog on the topic of “ready, fire, aim.” This topic is well known. The core concept is that, for some businesses, it makes sense to plan products by marketing various versions of a product until a winning combination is identified. Despite the fact that this product development approach is well known, we need to note here that entrepreneurs should establish clear limits on the type of business opportunities that warrant a “ready, fire, aim” product development plan, in contrast to those that do not. A blanket application of this approach to any/all business opportunities to develop products is not only dangerous, but potentially disastrous.

Businesses that need to transition from a revenue model based on product sales, to one based on sales of services, should proceed very slowly and carefully. In other words, this type of serious change in revenue, which is the most critical component required for a business to manage its own operating costs (not to mention its profitability), requires a “ready, aim, fire” approach if it is to be successful. Therefore, management should commence planning for this type of change well in advance.

Unfortunately, in many cases necessity is the driver, which obliterates any opportunity for management to plan the transition successfully. If conditions are at hand that threaten the continued operation of a business around a product sales revenue model, it makes more sense to discontinue operations than to rush into a services revenue model. Simply charging into a radically different type of business, that is largely unfamiliar, makes little sense. Nevertheless, lots of early stage businesses follow this dangerous route.

Where there is time to put together a plan of action, it makes sense to engage with as many knowledgeable people as possible to gain insight. Of course, an ability to network with peers, industry spokespeople, and even potential customers is very important. As plans coalesce, it will make more sense to go back to some of these contacts to test assumptions and ensure that plans are, in fact, promising. It almost never makes sense to simply rush, blindly, into this type of transition.

A best case scenario for a radical change in revenue strategy is a business that is expanding; for example, a product manufacturer opting to add a services group. IBM Corporation is an excellent example of a business that successfully implemented this best case scenario. A current example of a business attempting to follow this model is Dell. In the next post to this blog we will look closer at how Dell’s move is actually a hybrid amalgam of product type transition, and business growth through acquisition.

© IMB Enterprises, Inc. & Ira Michael Blonder, 2012 All Rights Reserved