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Selling the value of digital signage (8)

 

Digital-signage vendors: stop talking up features, and focus on the business value your customers really need. That’s the message of Steve Hemmings, owner of Realpoint Consulting here in the UK and a veteran of Cisco, Lucent, and VeriSign, who’s given us this interesting take on the digital-signage business from a seller’s point of view.

Steve writes:

When I made the move from selling core network infrastructure into the world of digital media, within the first 12 months I wondered what on earth I had done.  The sales calls were certainly more interesting; I talked about how much more effective rich media was in grabbing people’s attention, and how it was going to revolutionise communications in both consumer and corporate markets.  However, I’d stepped into an industry where customer acceptance was low, good content was thin on the ground, ROI models were nonexistent, security was questionable, and workflow awkward.

How things have changed!  Having now spent the best part of the last decade in digital media, the tide has turned and one of the markets that’s seen a huge take-up is digital signage. In all of its guises, digital signage has become an accepted channel of communication in both consumer and corporate markets. As this market moves forward we’ll experience new and exciting products and technologies as suppliers and services providers race to capture our attention and market share; innovate ways of doing things as we strive to create new market opportunities, improve systems and efficiencies, etc.

We’ve moved beyond the technology sales approach when dealing with customers, I see some really sensible business and technology applications being made.   For example, you don’t often see a media channel nowadays without some sort of measurement software being applied.  There are also some great content-creation tools available to support screens, and smart camera technology is helping screens in retail and transport businesses apply more effective business models.

One area that I have a particular interest in is the concept of ‘three-screen’ applications, where digital content is ingested only once but delivered and played out or consumed by many different ‘screens’ (TV, PC/plasma/LCD, mobile).  In the case of retail it’s been called ‘four-screen’ by adding ‘in-store’ as the fourth element.  In principle the technology is available today. However, further development is needed before we see really good ‘three-or-four-screen’ campaigns.

Not all is perfect however, and there are big issues the industry needs to tackle.  Industry associations are playing their part in helping with some of this, particularly around advocacy and standards.

However, as the market gathers pace it inevitably attracts lots of new entrants, which in itself is good.  But, when markets generate a lot of similar products and services the laws of supply and demand start to apply.  Where there’s a surplus of similar companies, employing similar people with similar jobs, coming up with similar ideas, producing similar things with similar prices and similar quality, some suppliers will find it very difficult to compete.  As management guru Tom Peters observed in 2000, commoditisation is one of the biggest threats facing businesses.  Factors such as tougher competition, declining product differentiation and the rapid increase in exports from developing economies all make it harder for suppliers to differentiate themselves and withstand price pressures.

Strategic procurement practices also play their part and present particular problems for suppliers who sell on brand and reputation, have expensive infrastructure, and broad capabilities. 

To compete effectively in tough markets you need to create differentiation and build a genuine perception of uniqueness with your customers.  Engage with customers in a different way and use relationship strategies to construct and articulate truly differentiated value propositions.  Customers demand more than product or service from their supplier relationships, they seek value through consultative and problem-solving skills, with need-based conversations instead of sales pitches, and often a long-term relationship. 

The process of creating value for a single customer involves the whole of your organisation and covers not only products and services but your total capability.  It goes beyond the service level agreement and contract and is manifest in the way people from both sides in the relationship interact and deal with each other.

For example, when you are proposing a solution you will most likely provide clear financial benefit which is immediately recognisable and can be determined by your superior products and/or services.  Your proposal will highlight your expertise and knowledge, brand and company values (although difficult to quantify, they will have perceived value in your customer’s mind).

However, the most difficult value to put your finger on, and yet probably the most powerful, is the experience your customer gets when they deal with you.  By building great relationships from the very beginning at all levels you will gain access to people and information that is vital to you.  Once you start to sell business value (financial benefits and helping customers achieve their business plan this year and next), and then enterprise or organisational value (by building the customer’s forward strategy), you are really talking about the future and differentiating yourself.

Commoditisation is already affecting parts of the digital signage market.  I know that even complex solutions include a high element of commodity value, but to stay out of the commodity trap and see value pricing coming through, you need to sell your whole capability and focus on the relationship. 

In the days when I started selling digital media solutions it was mostly about the technology, a little about how it would help the business, and precious little about metrics.  Today, I’m pleased to say that we’re talking much more about the business end: integrating messages and experiences, improving ingest and workflow, targeting and metrics, etc.

The sales process with digital signage is complex and companies are looking to make the conversations between their sales people and customers more meaningful.  Even in a dynamic and exciting market like digital signage, the highly individualised and personal skills of communications, questioning, influencing, and nurturing are very important.  The relationship between seller and buyer is still the most significant contributing factor to winning or losing the sale.  

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