Sell ​​”-skills”: Part 2

In the last article I talked about different strategies to sell the ‘reliability’ aspect of your software or hardware. I mentioned how most high-tech vendors love to talk about their “skills”: reliability, upgradeability, compatibility, and expandability. In this article I want to discuss how to sell upgradeability. When is the right time to sell upgradeability? When do you mention the possibility of future updates? How do you position future software or hardware upgrades with a new or existing customer without falling short? How often should your company release updates? These are all good questions when it comes to the art of selling upgrades.

Sale of upgrade capacity

So how do you sell upgradeability? Well, let’s start with a basic question. What does the word upgradeability bring to mind when a vendor mentions it? If you’re like me, I think the product has room for improvement, and in the future, if I choose, I can upgrade to whatever new capabilities the software or hardware might offer. Microsoft Windows epitomizes the model for selling upgradeability. There are four ways to sell upgradeability:

Strategy 1: Ernest Dichter, a famous advertising executive, made a statement that talked about how we as salespeople or marketers should use motivational thinking techniques to make people unhappy in a constructive way. Dichter knew that people would only buy a product when they were not satisfied with what they currently have. The job of marketing and sales is to make ‘people constructively unhappy’ with what they are currently using. A good example of this is our migration from audio tape to compact disc. Marketers reminded us of that annoying ‘hissing’ sound with tapes and how slow it was to rewind or fast-forward to find our favorite song. They went on to promise the delivery of total ‘loyalty’ with the CD along with the ease and convenience of finding your favorite song. Consumers accepted the argument, and the era of the compact disc was heralded. By selling upgrades, are you making your customer “constructively unhappy”?

Strategy 2: When I hear an update on any sales pitch, I immediately think of options. The vendor’s task is to give the customer a “vision” of what might be possible if he chose your product and then decided to upgrade. Upgradability indicates that there are other features that can be purchased without having to absorb the cost of all of them at once. A customer likes to know that if he is satisfied with the performance of the products, he could upgrade to something more sophisticated or advanced at any time. This piecemeal meal approach is especially effective with clients who have limited budgets.

Strategy 3: Upgradability, especially second or third generation, signals to the customer that your company is continually improving the product (ie, responding to customer needs and investing in research and development). This is the key; many customers want to be sure that the product has not reached its “peak performance” and that the product will improve over time. Updates should be sold on average once a year. Many upgrades a year can be seen as ‘product fixes’ or another way of extracting more sales from a customer leading to ‘buyer resentment’.

Strategy 4: A major mistake many sellers make is not taking the time to show or prove to the customer how using your product will increase sales and effectiveness, leading to a quick return on investment (ROI) for the buyer. Clients want to see hard numbers on how the solution you offer will positively affect the bottom line. Too often, salespeople will say things like, “This will improve your productivity,” “This will make your employees more effective at their jobs.” Or, “This will save your company a lot of money by adding this update.” All of these statements are qualitative, not quantitative; the latter can be proved, the former is just an assertion. Customers want quantitative proof of how their upgrade will improve their bottom line, whether it’s increasing sales or lowering their cost. Highly trained salespeople come into a customer meeting armed with quantitative evidence of how upgrading to the next product level will achieve their profitability goals.

Upgrades are a great way to add an additional revenue stream to your business bottom line. Once again, think of Microsoft. Every year or so a new version of Windows comes out and many of us techies rush out to buy it. How can you create this kind of excitement or anticipation with your company’s product updates?

Victor Gonzalez, All rights reserved 2004