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Making a Business Out of Connectivity

30 Oct, 2003 By: Richard Norton imageSource

Making a Business Out of Connectivity

more than a few years now, we have had the ability to connect digital copiers to
customers' networks. This was, and is, regarded as a significant upside
opportunity for the seller in terms of adding clicks and revenue to a business.
However, after an initial growth of connectivity rates to the range of 30 to 40
percent of new placements, we seem to have stalled in our quest for still higher

have been many opinions expressed about the role of compensation in increasing
the rate of connectivity for new sale placements (In other words, pay the reps
and they'll connect more machines). While compensation is certainly a factor in
the overall mix of sales activity, it is by no means the single answer to higher
connectivity rates. There are several other factors that need to be examined.

This sounds like a very basic thing to say, but direction is always set at the
top of the organization. A dealer can say that he wants to achieve higher
connectivity rates for his new sales, but if he does not live and breathe this
attitude, it will not translate to his sales force. We would like to cite an
example based on an experience over twenty years ago when I first started in the
copier business. At that time, many dealers were happy when they got an order
for a machine sale, but I noticed that the most successful dealers were the ones
who insisted that a sales rep come back from a customer with three pieces of
paper. The first was the contract for the new machine placement. The second was
a maintenance contract for service and the third was a supplies contract. These
dealers far outclassed the dealers who were concentrating only on the machine
sale at the initial transaction with the customer; the same attitude should be
used by the dealer principal to the sales force today. In this regard, the
dealer should add a "fourth piece of paper" to the sales rep's
responsibility. This fourth document would be a systems engagement with the
customer. If sales reps are not consistently bringing back orders for connected
devices, the dealer needs to let the sales reps know that this is not
acceptable. That sounds rather blunt, but, if a dealer is to succeed, he needs
to make it plain that his sales force must carry out his mission. Now, a sales
rep cannot do this by himself. He needs other things to happen in the

Capabilities Dealers need to be able to talk the same language as the IT Manager
at the customers' locations. At the end of the day, the IT Manager is the one
who holds the key to a dealer's success in connecting products. In order to be
entirely credible to an IT Manager, a dealer must sell some sort of systems or
solutions into the IT community. It has been my experience that the type of
systems sales-network installations, document management installations,
production print stream management, etc.-do not matter. The key is selling some
sort of system that brings you credibility with the IT Manager.

of the important words in the above paragraph was to sell "systems."
Merely having a few technicians who are trained in network connectivity will not
be enough in the long term. Dealerships need to reposition themselves as being
in the business of (and therefore charging for) systems work for the IT
community. Unless you are perceived as being able to make a valuable
contribution to the IT Manager's job, you will not succeed in the connectivity

of course, requires a significant investment on the part of dealers who have not
moved in this direction as yet. Some dealers have acquired this expertise by
buying other local businesses such as a value-added reseller or systems
integrator. Some dealers have developed their own capabilities by hiring the
right people and sending them to education courses. It doesn't matter which road
is taken as long as the expertise is resident in the dealership and that the
dealership makes a business of it by charging for systems engagements. The
dealer must also allow time for this business to develop-it often takes more
than one year to get the first systems engagement with a customer.

Analysis Our industry has managed to raise a couple of generations of sales reps
that do not really understand their customers' businesses. Sales reps have been
taught to sell cost-per-copy as the means to secure new leases at customer
locations. While this works to a certain extent, it reduces your perceived value
to the customer into fractions of a penny per page. This can never be a winning
strategy in the world of connectivity.

dealer must make the investment in time and energy to transform his sales force
from the penny pinchers who sell cost-per-page programs to advisors to their
customers. There is a wealth of techniques available in the marketplace to
perform workflow analysis for your customers. By performing an analysis of how
documents-both electronic and paper-move around an office, you can design an
efficient deployment of network-connected copiers, printers and software to make
your customer more productive.

of the more successful dealers have been using these sorts of techniques for
years. And, you will probably have noticed that Xerox is now touting its Office
Document Analysis. Any disciplined approach that helps a sales rep strike up a
conversation regarding the use of hardware and software in a customer's location
can only result in benefits for the dealership. At a minimum, you will look like
a more valuable partner to your customer. As an added benefit, you will
undoubtedly begin to sell more services to your customers.

Product Champion Besides the positive tone being set at the top of the
organization, every dealer needs to have a product champion who is going to push
the sale of connected products, but also, and more importantly, push systems
capabilities as a product offering. There are dealers who are their own product
champions. These are dealers who have small operations and not only manage the
entire business, but also design systems engagements for their customers. More
often, the product champion is a systems savvy individual who will back up the
sales rep and become the primary interface with the customer's IT department. In
the successful dealerships, we have noticed that the dealer principal insists
that the product champion be brought into all sales engagements by the sales

Selling Cycle When dealers begin to change their customer approach to one of
more consultative sales than penny pinching cost-per-copy sales, two things
happen. The first is that the selling cycle becomes longer. Dealers move from a
thirty-day selling cycle to one that more often approximates sixty or ninety
days. In some cases, dealers have been in conversations with potential customers
for up to a year before the deal is signed and delivered. This sounds like a
real negative to many dealers, but the second part of the equation is very

second thing that happens when you engage in consultative sales is that your
average sale transaction increases dramatically. The reason is, you are not
limiting yourself to the sale of one multifunction product but rather opening
the conversation with a customer to include his entire workflow which could
entail a number of different machines as well as software or system engagements
for fees. In some cases, dealers have found that the average transaction
increases from two to four times the levels prior to performing workflow
analysis for customers.

So, a
dealer must weigh the benefits of potentially expanding a business against the
longer period of time it will take to sell the customer. This of course will
become a management issue, as a dealer must keep up with his purchases from his

Manufacturers One of the ironies of the marketplace today is that copier
manufacturers all want higher connectivity rates and more solutions in sales
made by their dealer resellers. However, other than sporadic incentives provided
to a sales rep for a sale of a particular piece of software, virtually all of a
manufacturer's incentives to dealers revolve around placement of a machine.
Therefore, we have a situation where the ultimate goals (higher connectivity
rates and solutions sales) are not being consistently and strongly reinforced by
incentives from the manufacturer. This needs to change in order for
manufacturers to be ultimately successful in selling through their dealer

With virtually every one of your customers possessing computers and networks,
they all represent an opportunity for a network connected sale. In fact, whether
you like it or not, this will be the case within the next decade. Most
businesses will have all of their imaging products connected to their networks.
If you accept this as a direction for the industry, it only makes sense to move
your entire organization in that direction.

you need to move your sales force away from the conversations about
cost-per-page and move them firmly into value-added engagements in the IT
community. There are things that a dealer needs to do in order to set this tone
from the top and also to provide the tools for the sales reps to be successful.
We believe that the employment of the actions outlined above can be a
significant contribution to a dealer's move toward higher connectivity rates for
the future.

Norton is the president of the Saratoga, CA-based market research firm
DocuTrends. Norton can be reached at rcn451@aol.com or 408.253.2763.

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