21 Apr Simple sales solutions for your most complex pricing variants
In most businesses, setting pricing is an overwhelmingly large and complex task. Companies devote significant resources and effort to making informed pricing decisions on everything from subscription-based pricing to bulk pricing to partner-specific pricing. Despite these efforts, companies recognize they still struggle to get pricing right. When pricing is complex and varies from case to case, it’s easy for departments to fall out of the loop. At the same time, businesses recognize that complex pricing structures are critical to their success: No two customers are alike, which means pricing needs to be customized to reflect every customer’s unique needs, goals, and sensibilities.
To make complex pricing as streamlined, consistent, and high quality as possible, companies turn to modern, cloud-based CPQ (configure, price, quote) technology solutions, especially industry leader Salesforce’s powerful Revenue Cloud platform. Through CPQ, complex pricing variants that are unwieldy and error-prone to manage manually become suddenly manageable across a wide range of niche specialty markets. Sales teams can confidently and rapidly manage complex pricing variants, even in the face of ever-expanding product offerings that include endless combinations of design and service options. Let’s explore five key ways that companies with complex pricing can use CPQ technology effectively to simplify and streamline their sales cycles:
Only require manual approvals if quotes deviate from pricing rules
Sales teams in most organizations are required to seek manual approvals for almost every custom quote they prepare. This practice is understandable: Companies want to ensure that they maintain minimum margins on every sale. At the same time, a mandatory manual approvals process for every quote is cumbersome for sales reps, and dramatically slows down a rep’s ability to send quotes to customers. CPQ gets around this traditional source of friction by enabling companies to establish pre-programmed rules for setting pricing and then automatically checking quotes to verify that they’re within the pricing rules. For quotes that fall within pricing rules, CPQ authorizes sales reps to send quotes to customers immediately. Meanwhile, when a sales rep wants to consciously deviate from the company’s pricing rules for a particular customer, CPQ can automatically route this quote to the appropriate approver(s). And for approvers who don’t immediately review pending quotes, CPQ technology can send auto-reminders until they have a chance to review any outstanding quotes.
Involve multiple teams in setting and monitoring pricing rules
Sales teams do their best to put together quotes that represent the best price they think they can get for their company and the customer. But sales teams are not finance gurus who are constantly thinking about margins, profits, and revenue forecasting. Nor are they product designers or marketers who fully understand how customers intend to or could use the products they’re selling. Fortunately, CPQ offers a logical path forward for other teams within a company to play a proactive role in pricing decisions. Instead of leaving all of the work of configuring quotes to the front-line sales reps, multiple other teams—finance, design, marketing, and executive management—can work collaboratively to write pricing rules that put guide rails on how sales teams prepare quotes via their CPQ platform. Finance teams can automatically exclude pricing levels that are too low to be profitable. Design and marketing teams can exclude pricing configurations that are least likely to be effective in meeting customers’ needs or price points.
Automate the quote preparation steps that accompany price setting
Setting pricing is not the only step necessary to prepare a custom quote. Sales teams are also responsible for verifying that the quote is complete, accurate, and error-free, and packaging the quote in accordance with branding guidelines. Finally, sales teams are responsible for inserting appropriate disclaimers and other legal language into the quote. CPQ technology automates all of these traditional manual processes. Quotes are automatically generated, with the CPQ system automatically pulling together the final quote as a complete package, with all of the necessary contract language automatically inserted where it belongs. This automation saves copious time for sales reps and ensures quotes get delivered much faster to customers.
Quickly eliminate pricing options that don’t align with the customer’s needs and budget
Many companies struggle with how to price quotes because they don’t take the time to understand what the customer’s needs and budget are. By asking just a few quick questions, sales teams can often rapidly narrow down a universe of potential configurations and price points to just a few viable candidates. CPQ facilitates this process by explicitly allowing sales teams to enter the customer’s budget, then offers configuration options that will fit the budget criteria, including automatically calculating relevant discounts. CPQ will also automatically identify potential cross-sell and upsell opportunities that fit within the customer’s budget.
Don’t try to make your sales team pricing experts
Sales teams in most organizations are expected to be knowledgeable enough about pricing to generate optimized quotes entirely on their own. While some sales reps take pride in this work, the reality is that it’s inefficient and burdensome to force sales reps to become de-facto pricing experts. Your sales teams’ time and efforts are much better spent building stronger relationships with customers and being seen as a true partner and asset to customers at every stage of the buyer journey. Meanwhile, the responsibility for setting pricing can and should be logically shifted to the CPQ system itself.
Complex pricing is an intrinsic and critical part of many companies’ sales strategy, but that doesn’t mean sales teams need to bear the burden. On the contrary, modern, cloud-based CPQ solutions can take care of much of the work associated with complex pricing. The keys to using CPQ effectively are to eliminate manual approvals when pricing falls within pre-set guidelines, involve multiple teams in managing pricing, automate many of the other steps involved in quote preparation, quickly eliminate pricing options that don’t fit with the customer’s needs, and get rid of the expectation that sales reps need to be pricing experts.
Simplus specializes in helping companies use Salesforce Revenue Cloud to simplify their sales cycles even in the face of complex pricing variants. To learn more about how to create seamless CPQ experiences for sales teams and customers alike, please reach out to the CPQ experts at Simplus today. We look forward to unlocking the power and potential of CPQ for your organization.