Services as Solutions

Firms need to understand their service and their customers to ensure that their services will be viewed as solutions to consumer needs.

Learning Objective

Demonstrate knowledge of the skills required to sell services as solutions to customers and prospects

Key Points

If you want customers to buy your services, you need offer them a solution that costs less than the problem is costing them.
No customer will renew a subscription service or buy more consulting services if they don't see genuine value in these services as it relates to fulfilling their business objectives.
Selling services as solutions is different from solution selling because instead of defining the solution and then looking for applicable problems, you are tailoring your services to fit your prospective customer's day-to-day problems.

Term

value
a customer's perception of relative price (the cost to own and use) and performance (quality)

Example

The use of technological advances in service and product offerings can be very beneficial to a company. For example, Visa has embedded security chips, such as the one displayed in this picture, into their Visa credit cards. This chip will ensure the card cannot be duplicated and provides extra security measures to consumers who use the credit cards and reduces the threat of identity theft. Applying this technology is just one of the many services Visa can implement to protect their consumer product offerings against identity theft. It may not be the only solution, but it is a fairly effective one. Visa was able to change their marketing strategy due to the changing nature of the environment.

Full Text

Introduction

If you want customers to buy your services, you need offer them a solution that costs less than the problem is costing them. Your solution might:

Save your customer money;
Save your customer time: or
Improve your customer's productivity.

This is different from solution selling because instead of defining the solution and then looking for applicable problems, you are tailoring your services to fit your prospective customer's day-to-day problems. In essence, you are in the problem-solving business and if you can prove that you can solve your customer's present problems, you'll have a long-term customer who will come back for more and more.

In order to accomplish this task you, and anyone involved in selling your services, need to:

Have an excellent understanding of the services you're offering and what can and can't be tailored to a customer's requirement;
Have an solid understanding of the common problems your prospects face and those that your services can solve; and
Prepare 20-25 questions to identify possible problems and generate credibility and confidence in your company's abilities.

Selling Services As Solutions

Without genuinely valuable services for your customer, you have no revenue. While "what's the value proposition? " is an over-used term, below is a more specific definition of value, particularly as it applies to application software (in contrast with infrastructure software).

It's about selling a meaningful solution bundle

When selling services rather than technology, the focus should be on people and organizations—listening to and understanding their internal projects, and being considerate of their timelines and budgets. It is important to listen and provide a fair offer for services that genuinely meet a customer's need. Budgets are much too constrained these days for anyone to buy services they don't really need. This model can be a good foundation for a company, leading to a sustainable revenue stream that can help to further fund the development of the product.

In other words, create revenue that can sustain and grow the business, to make the product better in the long run, and to enable customers to better deploy the software. This only happens if the software and the services provide real value to an organization.

It's about customer engagement

Years ago, the Red Hat Network offered a valuable service for those who purchased a software subscription. If you passively wait for the renewal, you can expect that some customers will ask themselves, "Do we use this subscription service or not? Do we really need to continue to pay for it? " A proactive approach in this scenario is to demonstrate ongoing value by regular customer engagement, showing the customer new features they can access via their subscription, reviewing their current use of the product, and offering add-on services to help them be better trained or better able to use more of the product for more of their organization.

The fundamental principle here is value. No customer will renew a subscription service or buy more consulting services if they don't see genuine value in these services as it relates to fulfilling their business objectives, whether that be better customer service, better IT responsiveness, or better IT management.

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