Every time one of your customers is presented with a major choice, or a new technology comes along and they have to think, "Shall I move to this?" you are in great danger. There is a critical risk that the customer will do more than change to the new system or software that you are suggesting - it is also highly likely that they will change supplier too.
Consequently resellers and integrators have to take great care in the way that they present new technology. If you just say: "Here is a wonderful new paradigm for your computing infrastructure, and you should ditch your tired old proprietary system and move to client/server," the chances are that the customer, having had their eyes opened to how old-fashioned their current system is and how wonderful client/ server can be, will start to take a greater interest in the subject. At that point they are extremely vulnerable to being persuaded by one of your competitors to move supplier as well as technology.
Sales talk backfires
No matter how well your relationship with your customer has gone, after a few years they are almost obligated to start looking around at other providers. Even if you are the best, it is human nature and good business practice to compare and change suppliers every now and again. If you really are the best, you can hope that they will come back. Having tried the competition and found it less friendly, less competent, less responsive and more expensive, hopefully the customer will come back and your relationship can rise to new heights, and not be challenged again for several years at least.
But for many providers, a process which they initiate, which starts with them suggesting a move to a new technology or software, or a major system upgrade, ends with them losing the customer. It is a sad fact but one which every experienced sales manager is aware of - the process of selling can be counter productive. Educating a customer about something new can backfire.
Now for the good news
On the other hand, there is a bright side to this. For every customer that you lose, there is a customer which your competitor loses - to you.
There is a kind of swings and roundabouts process, with the customers moving around between suppliers and providers. The customer hopes that each time they make the change the quality of supplier will go up.
There is always a honeymoon period, of course, during which any slight sin is benevolently overlooked, but many providers are liable to be complacent during this first few weeks or months. They think that, having won the new customer, they are home and dry. Nothing could be further from the truth. Most customers, realising that transferring to a new provider is not too difficult, adopt a positive policy of changing supplier more regularly.
After all, not letting suppliers become complacent is good business practice.
It is ironic that integrators, having sold the message of open systems and having encouraged choice and interoperability, find themselves hoist on a petard of their own making. No-one wants to go back to the dark days of full proprietary, but it is worth noting that the strength of Microsoft derives in large part from its individual, aka proprietary, nature.
A buyer's market
Smart resellers are taking heed. Although you need to conform to standards and have absolute interoperability, you also need to develop unique product and service features which make it harder for your customers to move on.
Heaven forbid that we are talking deliberate lock-in here, but the fact is that if your business, its products and services are exactly like everyone else's, there is no reason for customers to stay with you when they start to feel restless.
If you want to make sure that your customers do not start to drift away, or if they do they come back fairly smartly, you have to offer two irreplaceable and invaluable resources: experience and knowledge. It's a buyer's market these days. Customers are well informed, highly educated and being wooed from all quarters. It's not just other resellers and integrators - the hardware suppliers too are seeking to provide skills and products that were your domain. Unfortunately, many customers think that in some way it is 'safer' to buy from a big name product supplier than a small integrator.
And the point at which customers will transfer is when you introduce the idea of a new product or infrastructure.
It's a quandary. Resellers have to keep suggesting new products and upgrades - that is the nature of proactive selling. Yet every time you introduce a new idea you are also introducing the possibility that the customer will move to another supplier.
Indeed, it is a widely-held principle among sales gurus that a proportion of your sales activity should be devoted to leads which show no signs of converting in the short-term. Long-term speculative sales work may be largely wasted, but the small percentage which comes to fruition makes it well worth making presentations to customers who appear to be utterly satisfied with their incumbent supplier.
So every time you go bounding in to an existing customer and tell them about the advantages of moving to NT or moving their business processes on to the Internet, bear in mind that you are suggesting a change which may result in them reconsidering their supplier as well as the technology they are using. New technology means change, and you may be initiating a bigger change than you had in mind.
Annie Gurton is consultant editor of Var World and can be contacted on [email protected]
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