Moving from selling IT services to product sales?
Been in sales with IT services companies and thinking of selling products or services for technology product or platform companies?
Recognize that the sales focus & skills required to be successful will change when making the move, especially on:
Selling defined vs. custom solutions
Range of solutions
Engagement after the first sale
Learning required to sell a specific solution vs. a range
Roles with product/platform companies could be in two streams – selling the core product/platform or selling integration services to implement it.
Selling IT products vs. services
Defined vs. custom solutions
When selling IT services, solutions can be configured using a set of tools programmed to create custom solutions for client requirements.
In contrast, products and platforms have a defined functionality e.g. An ERP platform delivers functionality of different ERP modules. A PaaS platform like AWS provides for application hosting and some development tools.
For those looking to move from selling IT services/solutions to products/platforms, the biggest change and adaptation is this - sell what the product or platform delivers vs. trying to address a client need through customized solutions or services.
The approach to sales changes from what the customer needs and finding a solution to it to what the product /platform does and finding customers for it.
Solution Range – ability to cross sell
IT services companies tend to offer a range of solutions – e.g. application development, maintenance, testing, reporting, analytics, and legacy migration.
In contrast, most product companies have offerings for a specific area E.g. SFDC in CRM/SFA solutions, Cisco in networking, and EMC in storage.
Relatedly, the availability of the services range allows for a dialog with clients to explore a range of areas for engagement and cross selling. This opportunity to cross sell across groups will be lower with most product / platform sales.
Cycle time between sales
In IT services there is active engagement with client and vendor teams post the sale and through project cycles, allowing ongoing touchpoints and relationship building. In addition, every project expansion or extension has an element of customization which again facilitates engagement and dialog between client and vendor teams.
In sales for large ticket products or platforms, gaps between the first sale and the next can be long. For products which are easy to understand / purchase (e.g. computers, low and mid-range storage, add on licenses for SaaS solutions), buyers can even do repeat purchases without needing to engage with sales persons – and often will do it via an e-commerce site.
These limit the touch points between sales persons and clients after the first sale.
Hence, the opportunity to build ongoing relationships with clients tends to higher in IT services. Even if the original sales person (e.g. hunter) is not engaged in selling the smaller add on’s, a relationship/engagement manager will build the ongoing relationship and client touch point for mining.
Learn once sell many vs. learning to sell a range
When selling IT services, every sale can be different from the previous one. The first sale may be for application testing, the next for a mobile application, and the third for an e-commerce site. While in each case subject matter experts will be engaged in supporting the sale, an IT services professional needs to have the ability to understand a diverse landscape of services and technologies to be successful and productive during the sales cycle.
Since products have defined functionality, once you have learnt what your product does and who will benefit from it, you can take that learning to multiple clients and sell with limited re-learning
Selling Services for product or platform companies.
Aside of selling the base product, product/platform companies may also offer services to integrate the product/platform into the existing technology environment of clients. This involves initial setup, integration, and minor customizations to ensure that the product/platform works.
When selling programming tools or platforms like Tibco, Azure, Splunk, or Cognos, there may be opportunities to sell services for pilot (or evangelization) programs to demonstrate how these tools can be used productively by clients.
In many cases, these services are bundled into and sold as part of the product sale itself since they are essential to ensuring that the product will work for the client or as part of the initial evangelization of a tool.
In addition, all technology vendors build an ecosystem of technology services partners to engage with customers post the initial sale & pilot to engage in ongoing and expansion projects.
Hence, after the first sale of the proof of concept or pilot programs, the SI sales teams of product vendors need to move on and the baton passes to the services partners to pursue new projects and programs.
Therefore, even services sales on behalf of product/platform vendors tend to follow a rhythm of a one-time / repeatable sale and then moving on to the next client.
When transitioning from sales of IT services to technology products or platforms, there are three changes to adapt to in order to be successful
First - understand the product, what it does, and who will benefit from purchasing it. Identify those buyers and focus your sales efforts on them. This contrasts with selling IT projects where custom solutions can be offered using foundation technology tools and the focus is on understanding the project needs of prospects and crafting solutions to addressing them.
Second – Most product companies offer a limited range. Once the first sale is made, time to move on and sell to the next prospect. This is unlike IT services where, using foundation technologies, you can identify and sell more projects and diverse range of engagements. This not only allows more opportunities to sell more to the same client but also sales persons to be adept across a range of technologies and solutions.
Finally – The time between repeat sales in products is longer, and for easily understood products, follow on sales will often happen through an e-commerce engine. So after the first sale, the engagement with clients tends to diminish. In IT services on the other hand, every new project is a customized solution and hence will require engagement with clients, whether from the sales team or the engagement teams.
Thus, in product sales, the first sale may be the last sale for a while. On the other hand, for IT services, the first sale or empanelment is a foot in the door which can open up opportunities for multiple follow on projects.
Hence, salesmen whose strength is identifying buyers for identified solutions, engaging rapidly, making a successful sale, and then moving on to the next prospect will find themselves both adept and successful in product sales.
Those who are more proficient making the first sale and then building relationships with clients to sell new solutions and follow on programs may find a better home in sales for IT services or with product companies which offer a wide range of contiguous products which can be sold to the same client.