Product Management Library of Knowledge
Demos, Pilots, and the Sales CycleDemos, Pilots, and the Sales Cycle
by Daniel Shefer
Enhancing the product demo and controlling the pilot will result in shorter sales cycles and a more satisfied buyer. As the market space becomes more crowded, we must become more experienced sellers. This article will discuss ways you can help prospects evaluate your product, shorten the sales cycle and increase sales.Some Places Where Prospects get Information about Your Product
Your Company?s Web Site
Most potential buyers start with your company web site. By browsing through your web site, prospects get a high level perspective of the benefits that your solution offers. Some of these benefits could be ?high ROI? ?reduced travel costs?, ?reliability? etc. While these are evaluation criteria in the long term, most sales will be concluded before these metrics can be evaluated. Therefore, prospects will find it difficult to create an evaluation process based on this type of information. To be effective in influencing the prospects? selection criteria, part of your website should cater to people that are interested in evaluating your product. This is where you would place product information, product comparisons, data sheets, and a ?How to Evaluate Document? (see below).
Prospects are always on the lookout for information on new products. One way to serve this need is infomercials. Familiar ways to do this are ads on TV or in printed media such as trade magazines. Over the past couple of years, a new option is available - online demos. These demos offer many advantages. They are cheaper and faster to produce and can be very effective. They are delivered live to a willing audience and the technology available today allows you to make them fully interactive.
For example, using Interwise (my product), Microsoft holds daily webcasts showcasing their solutions. During the webcast, presenters talk about their product using a combination of voice, video, slides application sharing and markup tools. They open the floor and the public is invited to ask questions. Because these sessions are online, they cost a fraction of physical gatherings and are much more accessible as they do not require travel. The events are recorded for later viewing; usually three to five times as many people view the presentation offline than attended it online!
It is always good to have an easy to view and compelling demo. Unless your product is very simple, even a good demo will not remove the need for an onsite demo or pilot but will give the prospect a better idea of your offering, a sort of general exposure. Demos can be a Flash presentation, a streaming video, a downloadable executable or a live demo as described previously. The latter is the most flexible but least scalable (it has to be repeated periodically).
The ?How To Evaluate Document?
A very effective way to influence the selection criteria prospects will use is by offering them a document that details specific, relevant, and easy to evaluate criteria. This document should also include explanations on why each criterion is important. This document is most effective when it is presented early ? like in a first meeting or even before the first meeting. This way prospects are thinking about what you feel is important before they see the competition. At Interwise, we offer prospects a document that details the things they should be looking at when testing a solution in our market space. This document is part of the sales kit and it is in Word format so prospects can edit it to reflect their needs. Prospects do not expect this document to be completely impartial but appreciate the input and learn from it why the items it covers are important to their success. What we see time and again is that when a customer works with the document some of it always ?sticks? to our benefit and appears as selection criteria in their evaluation process.
A complete set of evaluation materials should reside on your web site, along with infomercials and product demos, in order to ensure that the buyer has the right tools for a successful evaluation.The Product Planning Stage ?What needs to be in the MRD
Many companies include pilot requirements in their development plan to ensure easy pilot installations and initial customer success.?
Ease of Installation
For a successful pilot, the product installation should be small and as easy as possible. It's best if the product doesn't require dedicated hardware. This is the reason that hosted products (at least in the pilot stage) have a distinct advantage for pilots. You have control over the application and the prospect does not have to install it locally. While some of us have full control of their PC or are used to being able to order a PC and have it added to the network in a matter of days, this is not the case with most large companies. Large companies have tighter controls and their budget approval and hardware procurement processes are so cumbersome that it might take 3 ? 6 weeks for a prospect to buy and install hardware for your solution. Requiring prospects to obtain additional hardware can be a significant impediment on the pilot stage.
Out of the Box Experience
For a pilot to be successful, the product must be trivial to use. Getting it up and running should not be difficult or require a user guide. Instant gratification here is key. When addressing usability, it must be very clear to the developers who the prospect is and what type of knowledge can be expected of her.Product Pilots
Pilots that require some sort of commitment-- either a financial commitment or a dedicated employee from the prospect--have the greatest chance of success.
Many companies actually charge prospects for pilot projects. This can be an excellent way to separate the browsers from the buyers. If the purpose of charging for the pilot is to screen prospects, trial and error can help you determine the lowest price point that will guarantee that anyone who pays is really interested in your product but without scaring away potential customers. While most companies are able to recover their real costs of a pilot project, some companies price their pilots in such a way that they do not cover the costs of the professional services thus creating a loss center. This is a legitimate approach as long as it is intentional. That is, the decision should NOT be made by the account rep but by senior management.
A pilot that requires extensive help from your professional services is not an optimal situation. Such a complex product will not win points with the prospect. If the need for professional services is inherent to your product, make sure to spin it positively. This can be an opportunity to ?show off? your professional services organization. If they perform well and create rapport with the prospect, sales reps can leverage this.
One large ERP software company discouraged pilots at all costs. Pilots of their software were too difficult to set up. Instead, the sales team offered a training session if the prospect wanted hands-on experience to test the product and its usability. This approach had two advantages: it got a commitment out of the prospect for a week or more to attend the training session, and resulted in an onsite employee fully trained on their application.
If the pilot is not free, most prospects will expect that the price of the pilot be deducted from the final purchase price.
Beware of sales reps that pressure their managers to approve giving away a free pilot. Usually, what they are really saying is that they have a prospect that does not see enough value in the product to justify the cost, or that the prospect does not have the authority or budget to pay for it. In both cases, chances are that there is no deal down the line.
Defining Success Criteria
It is extremely important to agree on success criteria with the prospect before you start the pilot.
Prospects often look for the ?solve it all? product. When they don?t find it during the pilot stage, they may become frustrated and come back asking for features that are not relevant to their future success. Success criteria for the pilot should be agreed upon with the prospect in writing before the pilot begins. Using success criteria helps keep prospects focused on what they really need and creates an emotional commitment for them to advance in the sales cycle.
The Pilot Contract
Pilots should begin only after the prospect has agreed to well-defined conditions of the pilot. A verbally agreed upon written summary is best; a signed document would have to go through the prospect?s legal department and result in objections and delays. The terms of the pilot should include the end point of the pilot, success criteria, the resources the prospect will devote and the testing he will do on your product and if possible, a commitment to buy if the success criteria are met. The last item is probably the trickiest one and it?s an indicator to the sales rep?s skills. Such a clause is always desirable but not always be applicable.
It?s important to define the length of the pilot. Unless the prospect has an urgent need for a solution, prospects tend to drag their feet with the testing if you don't agree to a deadline. You should enforce the deadline by disabling the product after the allotted time. You can always extend the deadline. Don't give the prospect a never-ending trial period.?
It is the sales team's responsibility to get a feeling for the prospect?s ability to fulfill his commitments in the pilot agreement. Getting the product installed at the prospect site is the easy part. If the sales rep is not careful, the customer is likely to reach the end of the pilot having not done his testing. The only way to get the prospect to complete the evaluation is to extend the pilot and delay the sale.Summary
Product demos and pilot projects are part of the sale cycle. Product management can assist the sales team's efforts by making product information readily accessible on the web site, by making the product easy to install, and by making it easy to get some initial product acceptance. Review some of your company's recent pilot projects and see if you can improve the process for all sales teams.
This article and its contents copyright (c) 2002 by Daniel Shefer.