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Marketing for Dollars

Tired of competing on price? Value-based marketing and selling has creative solution providers flying high.

by Tom Farre

It seems like common sense. If you don't want to compete on price, you need to differentiate your company by establishing the value of your solutions. First, determine what that value is, then devise a plan for communicating it to prospects and clients, and finally deliver on your promise.

The devil for solution providers lies in the details. "When you get right down to it, we all do much of the same thing," says Steve Feldman, president of Graphtech Systems, a solution provider in managed services and projects. "Everybody talks about the ability to do quality work, good customer service -- all the normal things. We're always trying to make ourselves look different, so that our value resonates with the client."

Creating this resonance can be taxing, especially for solution providers who don't have a marketing person on staff. "Many solution providers may find it hard to market themselves because they are technologists at heart," says Carol Kurimsky, vice president, marketing, at Ingram Micro. "This can create a disconnect with customers. Odds are most clients don't want to discuss technology, but would rather hear about the big picture and 'What can you do to help my business?' "

There's also the need to narrow the message. "Some solution providers struggle to understand and pinpoint their business value because they do so many things well," Kurimsky says. "Often they are reticent to craft a value proposition they can own and market as a 'beachhead' to differentiate their businesses and begin the sales process."

This article is about the beachheads successful solution providers use to establish value, and how smart marketing and sales techniques help them leverage that value. We trust their ideas will help you improve sales and marketing in your own business.

The Value of a Brand
Experts consider establishing a brand to be a milestone in creating value. "Your brand is your promise, your value proposition, and what you do is how you fulfill your promise," says Dennis Crupi, group manger of client services in Ingram Micro's Marketing Services Agency. "Creating a brand identity is a way to let clients know that they're going to get a consistent experience."

Feldman of Graphtech recently undertook this process with Crupi and the Marketing Services Agency. The brand identity they created focuses on the value of Graphtech's business experience and technology expertise, particularly in two vertical markets, education and creative/professional services. All communications emphasize this, from the company logo to the web site to sales collateral and to how staff members represent the company.

"To rise above commodity selling, you need to talk strategically to C-level people about the role technology plays in their success. To do that, your sales and technical staff need to understand the specific industry and business," Feldman says. "If someone needs an e-mail server, most likely it's going to be Exchange, but how does it integrate with their unique workflow or vertical applications? We try to always focus on the business results that technology will deliver."

"If you're not spending enough on marketing and doing it wisely, it's costing you."

- Jon Eckhoff Venture Computer Systems

Since implementing the refreshed brand, Feldman notices a positive impact on the sales process. Sales training for new hires is easier, now that the company presentation is 80 percent consistent from client to client. And consistent brand communication helps sales staff home in on likely prospects.

"When we talk to clients," Feldman says, "if they're not looking for a bigger impact and lower costs of owning technology; if they're not looking for someone who understands their business; if they're not looking for someone who can bridge the gap between technology and their business processes, we're probably not right for each other."

When Quality Equals Value
For Jon Eckhoff, a solution provider with a sales and marketing background, branding is critical and everything else follows. A partner at Venture Computer Systems (VCS), a Minnesota-based solution provider with 35 employees, Eckhoff has worked hard to establish a premium brand that says, "We're not the lowest cost, but the highest quality and hence the best value." He's created this perception over time through consistent marketing via television and radio advertising, direct mail, working in the community and, of course, delivering the goods.

To promote the business value of working with VCS, Eckhoff?s 18 technicians drive sharp-looking company trucks during work and after hours with the message, "Helping your business reach its potential." These mobile billboards aren't cheap, but they are worth the investment, he believes. "If you're not spending enough on marketing and doing it wisely, it's costing you," Eckhoff says. "I've seen people hold their dollars so tightly that they don't make as much as they had the potential to do." For VCS, the results have been stellar: The company consistently defeats competitors who charge 25 percent less.

The front lines at VCS are staffed by consultative salespeople, sales professionals who are "good listeners as opposed to good talkers." They need to be passionate about technology and understand the returns it can deliver in enhancing productivity and profitability. "I'm not just looking for raw sales experience," Eckhoff says, "but an ability to explain how technology can improve the customer's business."

Sales talent notwithstanding, VCS's brand marketing paves the way to solution sales. "First, our marketing practically guarantees a meeting from a phone call," Eckhoff says. "Prospects know the company's reputation, and they're interested in what we have to say. And proper branding sets the stage for the sales close, because our promise is, 'VCS may not have lowest price, but we are the choice that's guaranteed to work.' "

Give Marketing Its Due
John Riddle, president of Information Networking Company (INC 1), seconds this view of marketing's essential role in solution selling. A longtime California-based solution provider with a degree in marketing, Riddle advocates a prominent role for marketing in customer acquisition, rather than expecting the sales staff to do all the heavy lifting.

"In the old days of computer reselling, sales was the preferred method for reaching out to new customers and bringing them in," Riddle says. "Now we are relying more on the marketing team to create awareness, brand recognition and identification, so that customers come to us. Many business owners are finding that creating a brand is more valuable than having telemarketers dialing for dollars."

Riddle doesn't downplay the importance of the sales function -- "Nothing happens until something is sold," he quips. He observes, however, that startup and small firms may find it hard to hire and keep true consultative salespeople. A sales staff often focuses on the immediate gratification of the sales commission. A strong marketing team will take a longer view, pinpointing the solution provider's true value and creating campaigns designed to "make the community aware of the company's greatness."

At INC 1, recent customer research led the marketing team to alter the value proposition -- not an IT provider, which is too technology-focused; not a trusted partner, which also has limitations; but a strategic partner for business-related issues. "A trusted partner says, 'Thank you for trusting us; we will do whatever you say and give you whatever you want,' " Riddle says. "A strategic partner says, 'This is what we believe you should do to improve and grow your company.' It is a message that resonates well with customers today."

The marketers at INC 1 communicate this value proposition to prospects and clients through Lunch and Learn events -- half-day sessions covering timely business issues, such as planning for disaster recovery and business continuity. If the content and the marketing are on target, the session will likely attract decision influencers, decision makers and senior executives, Riddle says. Events can be expensive to host, but manufacturer and distributor partners often provide funding and training.

Once a prospect is sold on the value of INC 1's expertise and solutions, the account manager enters the picture -- typically a salaried employee with strong people skills and a background in engineering or project management. Riddle describes his ideal salesperson as a "logical, intelligent and passionate individual. There is a quota," he says, "but it's oriented toward long-term growth. With prospects qualified by marketing, salespeople do not experience the no's and hang-ups of cold calling that can destroy their confidence."

Marketing Your Business the Ingram Micro Way

What is Ingram Micro's value proposition for solution providers? "We view ourselves as the ultimate technology partner," says Carol Kurimsky, vice president, marketing, Ingram Micro. "We put our partners in contact with the right people and the right resources when they need them. With thousands of relationships, services and resources, we are a powerful alliance because we understand their businesses."

Nowhere is this understanding more valuable than in the marketing assistance Ingram Micro provides. "Solution providers are really expert consultants and advisors, and our marketing team can help them promote themselves by highlighting all the points of value they provide," Kurimsky says.

Resources for Better Marketing
Ingram Micro offers multiple resources for solution providers who want to improve their marketing and boost sales:

  • Agency Express is an online marketing portal for Ingram Micro's customers to assist in developing fast, affordable marketing campaigns. The portal offers access to customizable templated mailers; mailing services, including postage, printing and delivery; and a databaseordering service to jump-start targeted marketing campaigns. Market development funds (MDF) are available to qualifying solution providers.
  • Channel Services Agency is a fullservice marketing communications agency that solution providers can use for advertising, marketing and PR services. Those who need help with branding, marketing communications and integrated marketing will work with seasoned professionals in channel marketing strategies and tactics. Whether for end-user marketing campaigns and collateral, direct marketing and lead generation, or complete rebranding services, the agency's staff works fast and effectively because of its channel expertise.
  • Marketing field representatives work hand-in-hand with Ingram Micro's sales team to help solution providers narrow and tune their marketing choices. As an example, field reps can assist in planning customer events such as Lunch and Learn sessions, matching the event and collateral to the type of solution or service being sold. They can also line up sponsors and other resources to lower costs and maximize returns.
  • Business development planning Ingram Micro's sales representatives are business development specialists who can guide solution providers to the most profitable technology solutions. For those wanting a deeper commitment, Ingram Micro offers customized strategic business planning. The process reviews annual business goals in sales, marketing, operations, infrastructure/ staffing and technical areas, and then formalizes a plan with Ingram Micro to achieve the goals. The process produces a business plan with Ingram Micro's written response, including activities for both parties, timelines and commitments.
  • Community membership Ingram Micro offers membership communities focused on solution provider interests and business models, such as the Venture Tech Network (VTN), Ingram Micro Services Network (IMSN), SMB Alliance (SMBA), GovEd Alliance, and System ArchiTECHS for system builders. In addition to seminars, vendor workshops and special promotions, these communities facilitate sharing marketing ideas, networking with like-minded executives and gaining insight into common challenges. "When you're a member of an Ingram Micro community, you're not constantly greenfielding new ideas," says Kurimsky. "That's going to save you money and make your business more successful."

"Solution providers are really expert consultants and advisors, and our marketing team can help by highlighting all the points of value they provide."

- Carol Kurimsky, Ingram Micro

A Positive Impact
Solution providers agree that working closely with Ingram Micro has a positive impact. "Ingram Micro is our No. 1 partner when it comes to providing technology products and/or services," says Larry Hedin of Heartland Technology Solutions. "Besides using their pick/pack/ship distribution services, we leverage IMSN for the delivery of services. And Ingram Micro brings to bear many resources to deepen our relationship with our major manufacturers."

Bryan Kuntz of Intellicom relies on Agency Express for marketing assistance when creating mailers and other collateral, and uses MDF from Ingram Micro to fund demand-generation programs. Intellicom also participates in VTN to network with other solution providers and manufacturers. Says Kuntz, "Ingram Micro has definitely helped us achieve our marketing and sales goals."

The Joy of Marketing
At Intellicom, a 28-employee solution provider in central Nebraska, operations VP Bryan Kuntz also dislikes cold-calling on prospects. His salespeople don't often have to, though, thanks to the company's extensive marketing. "As a marketing person," Kuntz says, "one of my greatest joys is knowing that our salespeople are getting inbound calls from people who have heard of us and have a problem they think we can solve."

The brand the marketing team has created is that Intellicom is the largest, most successful, full-service technology consulting company in the region. With divisions in telecom, engineering, web design and managed services, as well as hardware and software sales, Intellicom's "full service" brand describes the company well and positions it as a community leader.

To win business against smaller firms that compete on price, Intellicom markets its expertise and depth of experience. "We have so many talented staff members that it comforts customers to know that we will be there to take care of them," Kuntz says. "And we spend a lot of time talking up our certifications -- with Cisco, Microsoft and through CompTIA. We also stress the level of support we get as a Microsoft Gold partner, and as a member of Ingram Micro's buying group and VentureTech Network (VTN). These relationships help differentiate us."

"As a marketing person, one of my greatest joys is knowing that our salespeople are getting inbound calls from people who have heard of us and have a problem they think we can solve."

- Bryan Kuntz, Intellicom

The sales staff employs a consultative approach to further this perception of experience and exper - tise. Using a relationship rather than a transactional model, salespeople aim to establish trusted-advisor, virtual-CIO status with clients, hoping to engage them for years to come. A key method is digging deep into the client?s needs to show familiarity with business and technology issues.

"As we peel back the layers on clients' needs and the solution, we ask questions and offer advice on common pitfalls to help them make an educated decision, even if they're evaluating multiple proposals," Kuntz says. "Often they say, 'None of the other providers asked us these questions ? it really feels like you've done this before. Though you're more expensive, your comprehensive process has demonstrated that you know what you're doing.' "

Showing, Not Telling
Connecting Point of Greeley, a $6 million solution provider in managed services for four years, does not sell on price. To establish the value of its managed services, president Ted Warner believes in showing, not telling. This means bringing all the prospect's senses into play with a hands-on demonstration.

"In the SMB market we serve, customers want to know how well a solution provider produces," Warner says. "We try to create a perception of value by showing that we have superior processes and procedures, and by offering more than they expect right from the start."

Few prospects expect to discover the excellence of managed services through a live demo. Warner's salespeople bring them into the network operations center, where they get to see and touch the hardware, experience the software tools, and meet the engineers and help-desk staff -- an ideal setting to showcase the business benefits. Says Warner, "This allows us to be very anecdotal, saying, 'For this client we did this; another client ran into this problem and we solved it this way,' and we actually show them what we did."

Though most demos occur early in the sales cycle, Connecting Point uses several marketing techniques to generate sales leads:

  • Testimonial ads: These feature a photo of a high-profile businessperson, often with Warner, along with a customer quote and description of the IT solution. They run in local business journals and in the company newsletter; they are posted in training and demo rooms; and salespeople hand them out as collateral. "Say we did a testimonial ad for a bank," Warner says. "Another bank executive will say, 'Hey, we've got the same kind of issues. If they helped bank A, they certainly can help us.' "
  • Telemarketing: Several times a year, Warner hires a telemarketing firm to cold-call on prospects for solutions such as managed services or VoIP. Connecting Point executives compile the list, write the script and spend about an hour on the phone training the telemarketers. Warner estimates a close rate of between 1 percent and 1.5 percent. A list of 700 names might generate 70 leads and result in seven to 10 new deals.
  • Lunch and Learn events: Monthly meetings over lunch last less than two hours, plenty of time for prospects to learn about managed services. "Even if someone won't see a salesperson personally, coming to a luncheon is a non - threatening way to get educated," Warner says. Between one-quarter and one-half of attendees sign on for managed services.
  • Security assessments: Prospects who meet certain criteria are eligible for a free security assessment. A technician spends about one hour at the prospect's site, another hour writing a report, and the salesperson presents the results. "The security angle opens a lot of doors," Warner says. "It leads to both project work and the opportunity to sell managed services."

"We try to create a perception of value by showing that we have superior processes and procedures, and by offering prospects more than they expect right from the start."

- Ted Warner
Connecting Point of Greeley

Back to Basics and Beyond
Heartland Technology Solutions also sells projects and managed services. Spread across seven locations in four Midwest states, the $15 million solution provider serves SMBs in multiple tertiary markets. Technology specialties range from IT infrastructure to IP surveillance and telephony to GPS and precision agriculture.

With so much to offer, how does Heartland present itself to customers? "We don't compete on price," says Larry Hedin, vice president of sales and marketing. "We focus on building a total value proposition: 'If you want it done right, with a company that has deep vendor relationships, you'll call us.' "

Heartland's line card is surprisingly short -- only HP, Microsoft, SonicWall and 3Com. "If you're going to buy a server from us, it's going to be HP, and we sell the value of its engineering," Hedin says. Heartland also promotes its investments in its services team, the people who deliver and support the solutions.

If this approach seems basic, Heartland's marketing is anything but. The marketing team is so ambitious that the company sells marketing ser vices to other VARs, including a customized enewsletter for end customers that gets excellent results.

"You will never see prices in our e-newsletter," Hedin says. "What we do is educate and inform about subjects that have an impact on the client's business." Content covers IT and business best practices, stories about staff members serving clients, and case studies of clients who have benefited from Heartland's solutions.

The e-newsletter, which requires recipients to opt-in, is designed so articles are only partially visible -- if readers want to go further, they click through to the full article online. "Our tools allow us to track which companies did the click-through, so this helps with demand generation," Hedin says. "I get a list every month that tells me which prospects and clients clicked through, and I turn it over to our sales staff for follow-up."

Heartland also uses "drip marketing," a campaign of several oversized postcards that promise a free business assessment for small and midsize companies. The third card in the series explains that a salesperson will call. After landing an appointment, the salesperson performs the assessment with Microsoft's free SBS Assessment Toolkit, which provides insight into the company's business processes and pain points.

"The typical reseller salesperson usually reacts to what clients think they need," says Hedin. "The business assessment puts us in a more consultative role, giving our salespeople a deeper understanding of the business and how we can help." That, as we have seen, is what solution selling is all about.

 

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