Why CPQ is so Important (And Why that Won’t Change Any Time Soon)
By now, a lot of you know the story: CPQ solutions are supposed to simplify processes, enable growth, increase sales, yadda yadda yadda… And good CPQ systems will do just that, which is a reason why these systems have become so “hot,” as Gartner said in a recent report. Louis Columbus does a good job of breaking down the reasons why CPQ is accelerating in popularity in this Forbes article, but here’s the gist of it:
- Global scalability across channels, industries, selling strategies and pricing scenarios.
- Delivering measurable sales effectiveness improvements.
- Delivering anytime, anywhere quotes.
- Quoting and deal intelligence adoption.
- Enabling launch of customizable products on global scale.
Columbus is definitely correct – any product or service delivering the above benefits would catch the attention of just about any organization. But these benefits aren’t the real reason why a CPQ solution is the most important CRM application today.
The real business value of CPQ lies in the demand that exists for it, and NOT from the businesses implementing it. There are many ways to “optimize and streamline sales process.” Instead, I’m talking about the demand from the end-user or channel partner – also known as the “buying process.” Generally speaking, CPQ solutions let users:
- Engineer- or configure-to-order the product they want from the manufacturer/distributor.
- Receive on-demand product information, guiding them through sales process.
- See the product they have configured/engineered.
- Calculate accurate pricing for highly configured products.
- Receive immediate and complete quotes from the manufacturer/distributor.
To bring some clarity to the discussion, let’s take a step back and take a broader look at society’s relationship with technology. With little exception, we as a whole want self-service, automation and personalization. If I don’t have to deal with someone on the other end of the phone, I will gladly order my pizza online with the toppings I want. Additionally, that convenience will sometimes impact which pizza place I order from.
That’s a pretty simple example, but research says 76 percent of Americans expect a company’s website to include some form of self-service application. Additionally, 56 percent of respondents to that survey prefer self-service solutions when researching a company, compared to 26 percent who would prefer to jump on a phone call. Within the world of CRM, Gartner says it’s no different: “Customer Self-Service” is listed as the top priority in customer service CRM applications for 2015. As a whole, this demand is being driven by the customers themselves.
Bringing the conversation back to CPQ solution, looking at this research and general consumer behaviors, we can draw the conclusion that there is a strong cultural desire to do business (not just customer service) in all the ways that CPQ enables you to do business. What makes CPQ so powerful is it expertly melds user demand on the front end with business optimization on the back end. It’s meeting that end-user demand that keeps those end-users coming back and, as a result keeps the sales coming in.
That’s the real reason why a CPQ solution is the most important CRM application: it empowers the current consumer culture to sell and buy the way they want. And one thing we know about culture is it often takes years to evolve and change, so CPQ is going to have some staying power for the foreseeable future.