SunGard Availability Services - Cloud Series, Part IV
With the shift to monthly recurring revenue (MRR) models, now more than ever, companies are keenly vested in retaining customers for life. In fact, long-term customer retention and true partnership with customers is now an organization's number-one goal, but this can be challenging.
We find that companies that are most successful in driving MRR growth build a level of trust with their customers that less successful companies don't. They do this through a two-part discovery and qualification process.
Step 1 – Discovery: Understanding the Customer Buying Focus and Process
About 25% of opportunities in the pipeline often remain in limbo because customers don't make a decision to purchase. Ideally, you want to minimize the time you spend chasing deals. By understanding your customers' buying focus and processes you can close more deals faster.
Things to consider/ask your customers:
What issues are causing them to contemplate a new technology solution? Why are they looking to make investments in IT? What are the key drivers?
What's the business need for the IT initiative? What's the business case? What business challenges are they looking to solve — and when? What is the expected ROI? Over what time frame? Why do they believe new technology will deliver the results they require?
Who will be affected by the changes? Who are their internal and external customers (e.g., IT, lines of business, management, etc.) and what are their roles?
How will the project be funded? Has the budget for the initiative been secured? If no, how will it be approved within the organization? Who are the decision makers? What is the timing for making and funding a decision? How solid is that time line?
What is their criteria for selecting a trusted partner or technology partner? What is the path to becoming a trusted partner with them? How will you build trust with the company decision makers?
Step 2 – Qualification: Positioning Value through Effective Qualification
The more effectively you qualify the sales opportunity, the more likely you are to win the business. Effective qualification is directly linked to partner credibility. Customers are most likely to purchase a cloud solution from someone they believe understands their needs, they trust completely and they can relate to.
Toward that end:
Consider sharing a success story about something you did for another customer and then relate it back to them by asking a question that is aligned to their environment and challenges. Storytelling is an effective way to position your value while qualifying an opportunity.
Ask poignant questions that show you're really listening and are engaged. Open-ended questioning is an important part of effective qualification in the selling process.
Become an expert in the customer's vertical, industry and position. The deeper you understand the cloud industry and how it relates to specific business challenges the more effective questions and comments you will make in the discovery process.
By following these simple techniques, you will build credibility for yourself, your organization and the solutions you provide. Plus, you will not only improve your win percentages, but you will also boost retention.
Read our next post to learn five (5) best practices for closing cloud business.