Pillow talk

Don't ever let it be said that the best sales reps are swarthy, beefyguys with slick hair and lots of gold jewellery. Annie Gurton defendscustomer reference sites

Nothing better can persuade an unconvinced potential customer to sign on the dotted line than an existing customer ready to enthuse about a company, its products and services. Word of mouth has always been the best sales tool, and reference sites are widely used throughout the IT industry as assurance that a company means what it says.

Setting up a customer as a reference site can be an act of faith, but it can also backfire. The reference site is by definition uncontrolled and uncontrollable. 'You depend on a customer reference site to paint a good picture of your company, the products and services you supply.

But often the reference site has an agenda which invariably differs from your own,' says Nick Gosshawk, Digital Networks UK marketing manager.

'You have no way of making sure it will tell the story you want it to tell, or that it will even plug your products,' he adds ruefully.

'The reference site from hell could possibly create the opposite impression to the one you want it to portray. It may also sell other suppliers' products,' he says.

Gosshawk agrees that using customers as reference sites for sales purposes, or to talk to the press, can be extremely useful. 'It is a very important element of the sales mix.'

'There are two kinds of reference sites,' explains Gosshawk. 'Those that can demonstrate the successful implementation of a technology, show that it works, doesn't fall over, integrates with existing technology and gives some tangible business benefit.

'Then there are those that show how a stable and established technology, like wireless perhaps, can be used. That type of reference site is more often a showcase for our skills and services and demonstrates that we have a good relationship with our customers,' he says.

There can be unexpected benefits for the reference site. Geoff Pritchatt, telecoms services manager at Hydro Electric in Perth, Scotland, has had a relationship with Digital Networks for four years and has been a reference site over recent months. 'I get to talk to other managers doing similar jobs at other companies and get to exchange information.

It can be an excellent way of finding out what other companies are doing.'

There rarely appears to be any difficulty in persuading a customer to be a reference site, although some of the largest corporates, such as the Ministry of Defence and some banks and finance houses, tend to be more cautious. By and large, customers are more than willing to stand up and be counted.

At Hyperion Software, which provides financial consolidation and reporting solutions and has more than 300 customers globally, it is a policy that every customer become a reference site. The company marketing manager Richard Hawksworth explains that since the company was set up in 1987 it has been its strategy to aim for a 100 per cent referential customer base.

'We publish a customer list that contains the names of all our customers.

If a prospect says it wants to talk to someone on the list, we put them in touch,' he explains. 'It is a marketing USP for us to say to prospects that they can pick their reference sites.'

Hawksworth says the strategy has not backfired, and even in those rare instances when there may be a hiccup at the customer site, it has worked out well for Hyperion. 'The customer can see how we deal with things and the good relationship that we have with our customers. The end result is always in our favour.'

Hyperion's objective, says Hawksworth, is to emphasise its customer service.

There is no better way to do that than through using customers as references.

'In order to make sure that all our customers are happy we run regular surveys to make sure the current level of satisfaction at each site is good. That way we can pick up any possible problems and deal with them.

Knowing that every one is a reference site and any prospect might be contacting them keeps us on our toes.'

Being a reference site can be demanding, but it seems most customers are keen to have an opportunity to talk about themselves. Phil Benge, marketing director at Reflex, says that most companies do it for the kudos.

'A reference site is essentially given a free platform to show how it got its IT together and how switched on it is. Most companies jump at the chance,' he says.

If problems do surface between the supplier and the reference site, says Benge, it only adds more colour and authenticity to the reference site. 'We use reference sites extensively,' he says. 'They are extremely valuable to us. No matter how good the salesperson might be, there is nothing like an independent rubber-stamp to give a ring of confidence.

'Confidence is what reference sites are all about, says Benge. 'The biggest asset that any supplier can have is a happy client base. Having the confidence to introduce your customers to the world shows you have nothing to hide.'

Most reference sites and the vendors that use them are coy about going into detail about the deal they have struck, but often there is a straight quid pro quo arrangement of glowing words when required against a reduced IT bill. But more often, there is no financial discount.

'Most customers are happy to do it for the publicity they receive,' says Benge. 'Although they also know that the supplier is going to work that extra bit harder to provide first-class support. There is no way that any supplier is going to allow a reference site to have reason to say anything except praise.'

Benge advises that it is important to get a spread of reference sites across all the industries being targeted. 'A prospect in publishing or banking, for instance, may want to talk to other companies in the same sector. It may have the same problems and will want to see that we understand its markets and specific challenges. Customers always look for reference sites in their own area of business,' he says.

Some companies seem to make a business out of being a reference site.

Bass Taverns, for example, is used by companies including Oracle, Map Info, Tandon and Unisys. The company and its IT are widely used in case studies and its executives are apparently willing to drop everything to appear in conferences and seminars.

Mike Jones, Bass Taverns director of planning and development, believes the company benefits from its activity as a reference site. 'We always have the opportunity to say no, but we find that we get a lot of publicity which is positive and beneficial to our business.'

Jones denies that Bass gets any direct financial benefit, but acknowledges that by being a reference site the company is always assured of good service and support. 'I am sure we would get good service anyway, but there is no doubt that everyone is that little bit keener simply because we are going to be talking to prospects, and the press.'

Some suppliers invest in giving the representatives at their reference sites some media training before introducing them to journalists. But when they are only going to be talking to their peers, it is generally better not to be seen to 'prime' them. 'When they are talking to others in the same business, often doing the same job, they quickly strike a rapport and you don't want to be seen as contriving any situation or response,' says Hawskworth.

But Mark Powell, marketing director of UB Networks, finds that it is worth having a briefing session with a new reference site. 'They are often nervous when dealing with the press because they often imagine that journalists are going to do a tabloid-type hatchet job on them,' he says.

'We find it worthwhile reassuring them. We explain that most journalists are just looking for a good story. If you give them a good story they will be happy,' he says.

Wayne Morris at BMC Software says that the PR company or internal PR officer can play a crucial role in making sure the reference site delivers what the prospect or journalist wants. 'The PR professional can help train the reference site so that it is more confident and less green.'

Andy West at APlus, a company that helps BMC manage its reference sites, says: 'We provide reference sites with a document which describes the sort of questions they can expect to be asked and what they should aim to deliver in their response. We also visit each reference site to make sure there are no problems.'

It is a matter of focusing the reference site representative on the topics and issues that the prospects and journalists will be looking for, and ensuring that everyone gets the most value from the reference site situation.

Powell agrees that reference sites must understand what the prospects and the press will be looking for, so they can give them the information they need. 'The most interesting part of any reference site is what the company is doing with its IT and how it is deriving business benefit,' he says.

Powell finds that most customers are keen to be reference sites, especially once the potential benefits are outlined. 'We have just had a meeting with users at our user association and explained that we needed more of them to become reference sites.

'We explained the benefits to them, such as reinforcing their right choice, making it easier to have future purchases signed off, and of course, the benefit to their personal careers. We explained that there would be benefits to us, that would indirectly benefit them. We now have more users wanting to talk to prospects and the press,' he says.

There are various levels of reference sites, claims Powell. 'They can just be the subject of a written case study with limited contact with prospects, and possibly almost no contact with the press. Or they can be available for comment and visits by anyone who wants to talk to them.

'We can quote them on press releases and have them available to talk to any journalist that rings up looking for a story,' he explains. 'Most of the customers are proud of their IT and their solutions, and want everyone to know it.'

Most reference sites feel that their first loyalty is to the prospect or journalist calling, says Pritchatt, and will give a warts-and-all response to any enquiries. But there is no guarantee of loyalty to a supplier, and that is the risk it takes.

'We have a good relationship with Digital Networks and have been happy with them. We would be happy to tell anyone who asks,' says Pritchatt.

'But there is no question of allowing them to rest on their laurels.

We are continually looking at other suppliers. If we happen to find someone with better products and services, we will shift our purchasing, irrespective of the fact that we are a reference site for another supplier,' he says.

That is a risk the supplier has to take, according to Powell. 'Having a user commenting on a product or plugging it makes an enormous difference to a prospect,' he says.

'The fact is, no matter how good the salesperson is, at the end of the day he or she is a salesperson by trade and the customer knows that they will often say anything to clinch the sale,' says Pritchatt. 'When a happy customer reinforces the sales chat, there is immediate credibility. It works.'