|
OCTOBER 2006
Differentiate your Company
In a recent partner conference the speaker asked hundreds of VAR business owners to write down their key differentiation on a scrap of paper. With papers in hand, the speaker then listed three areas of differentiation. About a third of the audience responded to each. How can several hundred resellers have the same differentiation? In this month's letter I have listed some of the things that might provide differentiation. The question is, can you prove that your company is different when it comes down to you and your competitor?
Key Points of Differentiation
If your company is a VAR (Value Added Reseller), chances are your brand is really the brand of the products you sell. When this is true, you look like hundreds or even thousands of other similar companies in the eyes of the economic buyer. Price has become your differentiation. I have asked hundreds of sales people from reseller organizations this year, "What is your differentiation"? The answers I get include, "Our people are smarter, we have support services, we have more certifications, we are bigger than our competitors, financial stability...". Are these valid differentiators? From the buyer's perspective, everyone says these things. As we've discussed in previous letters on value proposition, there has to be differentiation that can be demonstrated. Every reseller has products and most have certifications, design and support offerings, and size and stability. Let's take a look at some demonstrable points of differentiation. You don't need them all, but you do need some.
1. A Trusted Advisor
Years ago one of my colleagues, Landy Chase, pointed out that the sales person is the first point of differentiation. If your sales team doesn't provide some differentiation, the rest of the sale will be an uphill battle. If your sales team is not equipped to advise on something that matters, you will likely fail this test in the high tech market. Executives are not looking for reseller advice on PCs, LAN/WAN, storage hardware, or servers. Equip your sales people with knowledge,and hold them accountable to become advisors to the people who make the buying decisions. Too often sales people hear an opportunity in a technology area, bring in the specialist before positioning their company, and the buyer in turn delegates the sale down to their IT organization. This is a demotion at best.
2. Your Team
Everyone has a team, but a team that demonstrates the character traits of dependability, honesty, and diligence stands out. If you have this, find a way to demonstrate it to the client. While there are thousands of resellers, all with teams that perform professional services of some kind, few stand out as honest hard working teams with the client's best interest at heart. Many resellers don't look past the credentials when making the hiring decision, and end up with smart, self serving technical people that cannot function as a team. Their eyes are only on the pay plan and career growth potential. This is not what your client is paying for.
3. Track Record
Everyone has a track record, but an outstanding track record provides differentiation. It might be due to poor performance, but it might also be a lack of marketing savvy. If you have an excellent track record, use it. For example, when a resume with References Upon Request shows up, or three references listed, it looks like everyone elses...but what happens when someone shows up with 36 references; a full page with three across and 12 down, showing name, position, and contact information? This resume stands out. How strong is your reference list and are you using it to close business? Do this; begin following up with past clients, and getting their referral and case study to share with others. Show new prospects that your clients love you! If you don't do this, you are competing on price.
4. Your Own Products
Of course you can create differentiation with your own products. We have seen this with a number of accounting packages, project methodologies, time tracking programs, and IP Tel applications. Any time you can take something you developed in house for your own use, and turn it into a product for sale, you can create differentiation. Reoccurring license revenue and support programs add to the financial benefits. Another thing your organization can do is publish. White papers, books, articles, etc, give the appearance of expertise. With the ease of online publishing, your team should be demonstrating Thought Leadership. Because it takes time, few do it ...therefore it creates differentiation.
So when you build your value proposition, don't spend hours on marketing rhetoric with no meat. Esoteric wording about design, integration and support look like everyone else. Take some time to build your sales team's industry expertise, technology/business acumen, and the ability to speak at the executive level to the pressure and issues facing today's buyers. Work on your reference list to create case studies that demonstrate excellence, and review your delivery team to make sure you have great people, in the right position, doing the right things to differentiate your offerings. Don't just send the sales team out with proposals and quotes showing a fat discount. |
