I love starting with disclaimers. So here is one.
Disclaimer: This is a long-read!
I don’t mean to scare you away. In fact, it took me a while to plan this article, write it, correct it, leave it for a short period, re-visit, adjust, and finally publish. So, it would be nice if you feel compelled already and read this text to the last line. ?
If you are in IT sales, business development, cloud consultancy, or happen to hold a managerial position, this post will give a lot of value as well. Now you know who this post is targeted to – IT consultancy struggling with the selling of cloud services. This doesn’t mean anything else about sales or business development can’t be learned from here. Many concepts discussed here are going to help anyone doing sales.
This is an actionable article, too. It identifies the challenges and gives the way out.
One more thought here while we are on the topic. Popular info-jammed “25 best working strategies to sell cloud” type of articles more likely don’t give enough room to even gain an understanding of what they actually try to solve. They just give 25 “working” solutions right away, leaving you hanging out there. But a long-read like this one might help. So, this is your chance to try something new. ? Remember Einstein’s definition of insanity? It’s doing the same thing over and over again yet expecting a different result. In the particular case for this article, I’m talking about seeing difficulties in selling cloud consultancy and sticking to 10 years old sales model still.
This leads me to the red line of the entire post:
You (as company management, sales, or business developer) are not selling cloud consultancy services at a greater rate because you are “me too” business. Let me explain.
This year I changed the workplace from one nice company to another nice one. And if you did it before, you know that it takes time to go to many interviews. I must admit, I love to go to job interviews. For one, maybe not obvious reason: I love to analyze companies as such. And knowing where to look, you see the company’s business pain immediately. So, six IT consultancies that invited me for an interview revealed the same – they struggle with organizing themselves for selling public cloud consultancy. Before you think this is not the case at your company, because the last cloud architect capacity at your consultancy division is sold for two years ahead, read this again: “they struggle with organizing”. I don’t mean they don’t have sales processes or cannot sell public cloud at all. There might be many of those processes in use and they could even be very effective in selling high-skilled talents. But the fact itself that your cloud architects are completely “sold out” speaks for the inability to scale your existing business model. And this is a challenge of a better kind. I’ve seen another – more common – side as well: when your architects and entire cloud team are on the bench for months.
Ready to take a sober look at your public cloud sales?
I believe you are having difficulties here if any of this is true:
- You have no idea where to start.
What comes first – hiring senior cloud experts or sales of the cloud consultancy projects? What should be the priority – marketing or creating a services portfolio? What customers want out of the cloud on an everyday basis? What should be included in a cloud offering portfolio?
If you cannot answer these questions exactly and right away, you are not organized to sell cloud consultancy. You haven’t yet figured out what is it you are selling.
- You are running the HBM (“Hope Business Model”).
This model is used by the majority of IT consultancies out there and is build on imaginary trust consultancies believe they are developing with customers. I’ll come back to the imaginary trust soon. Let me explain the idea behind HBM first. It’s simple: you hire a senior cloud solutions architect and sell her/his hours to a customer. It’s an easy deal because a senior architect usually brings a lot of value to the table on many levels – starting from strategy and throughout the entire cloud lifecycle. Here is the hope part. As your architect progresses at the customer site, you HOPE he/she will generate more projects and possibly involve more consultants straight from the bench. And here comes the trust part I mentioned. Sure, the customer trusts that your architect is capable. Is this the reason, though, to trust that your consultancy is the best choice for the large-scale project with 20 experts onboard? Based on one architect, whose skills almost everybody would buy anyway, can a customer assess your project delivery capabilities overall? And then, how did you plan to scale this model in the first place? How do you scale such a thing as hope? And how do you forecast the hope for more projects?
Consultancies hope their relationship with the customer going to last. Then they hope the customer is willing to buy more from them. Then they hope to find the right amount of the right talents to deliver on the sold contract. Then they hope the project delivery will go smooth. Then they hope…
- You are not selling cloud consultancy in projects.
This is the obvious follower of the previous point. You are in the game of selling cloud experts one by one, not project teams. Of course, there is nothing wrong with selling one expert type of engagement. Sometimes this is what a customer needs and nothing more. But having it as a business model is limiting your organization more than doing good in two ways:
– This business model is hard to scale as well. “One cloud expert per one customer/project” means you need to hire these experts often and they are not easy to find. They are not easy to keep either.
– Your delivery capacity is out of the window. It’s just none-existing. All your solutions architects are sold out. What do you do if a larger project comes at you right now?
Short perspective thinking like that brings consultancies to a state where they adopt “one person per one project” mentality and live by it. And this is because they want to “close a deal now” – aka short-term small sales, and not long-term consistent big projects sales results.
In the beginning, when you are a start-up of two, the short-term strategies might be exactly what you want. But why being stuck there when you are 100+? It’s almost like I’m compelled to ask: don’t you want to make more money?
- You are in the LGL (“Let’s Get Lucky”) game.
Sure, time by time you’re closing big deals. It happens that personal connection between your salesperson and the potential customer just clicks. Or your consultancy was recommended to a CIO. It happens that someone in your company knows someone who knows someone at another company, the connection is already there and that leads to a deal. Sure, sometimes HBM works as well. But let me ask if you planned for any of this to happen. I mean real planning, not just being prepared. Last time a big opportunity showed up, was it because you planned to have it or it just happened and you cannot honestly answer why? Were you planning to get recommended on a casual dinner by people you don’t know to people who never heard about you before? Here you might object with your fantastic marketing strategy that “obviously” finally worked, the name of your company is out there, that’s why customers are coming in…
I wouldn’t be so sure about that because things in real world don’t work that way. Your sales still have to go hunting customers on a regular basis. So, customers don’t come in by themselves.
I will be speaking more about why “getting your name out there” doesn’t work later in this post. But for now, I would like to ask one question: what is your customer acquisition cost? If you planned for a stream of customers to come, someone at your company has done the actual job on executing that plan, so the budget for this work had to be allocated. That allocated sum “attracted” the particular number of customers. What is this number? Just divide your total spent on customer acquisition activities (marketing, ads, sales meetings… what have you) by the number of acquired customers and you have your customer acquisition cost. If you don’t have control over these numbers, you are in the “Let’s Get Lucky” (LGL) game, not the numbers game. Consultancies in the numbers game are consistently repeating their successful cloud deals again and again. Because they measure what’s working and what’s not. Then they spend money accordingly.
The four bullets above are typical signs of what I call “me too” business. Let’s imagine a cloud services market (which is virtual) as a physical one. So, a customer goes down the aisle. You (as a company offering cloud consultancy) standing in the raw of seller behind the counter. “I’m selling cloud services!” – your competitor from the left shouts. “I’m selling cloud services as well!!” – the one to the right tries to overpower. You see the customer is looking at you now. What do you do? Well, you start to raise your voice: “Me too! I’m selling cloud services too!”
We all have been to these markets buying apples or oranges. How you, as a buyer, choose what apple to pick? From a huge pile of round green objects, people just take one. Do they remember the face of the person behind the counter 5 minutes later? Will they put the offer to find that seller again several days later even if the apples were exceptionally delicious?
Besides that, it’s clear now what “me too” business is, do you see that it’s hard to be one? Doing everything the same as everybody else, not getting results, and doing it over and over again sends you back to Mr. Einstein’s definition (of madness).
Here comes more real value of this article. If you (as consultancy management, sales or business developer) want to clear the confusion and start selling cloud services big time, then
Stop doing this:
1. Searching for the “silver bullet” in cloud sales.
The first time it happened to me I didn’t see the red flag. A colleague from the Sales department approached me in a corridor between meetings with: “I’m wondering… You are working with customers every day and know what they want… When sitting at a meeting with a potential customer, what exactly can I say to sell our cloud consultancy?”
In other words, give me the magic silver bullet type of a phrase that sells cloud services. Then it happened again and again. People love shortcuts, a secret no one possesses that propels you to success.
Sadly, I have a 100% working method for this. Those who are looking for shortcuts will not like it though. Here it is: become the number 1 cloud expertise organization in the world. The highest-ranked authority. The absolute dominating giant that crashes everybody else. The most trusted advisor. This is going to do the trick. This guaranteed opens any door at any customer automatically. Otherwise – some work is going to be necessary. (See how to fix this in “Start doing this” part below).
Failures, struggles and sacrifices are a process you need to master on your way to success, not putting endless time and energy on researching shortcuts to increased sales. There are no shortcuts. Period.
There is a secret sauce, though, that can help any company go much faster about achieving outstanding sales of public cloud consultancy services.? And I will be giving it away. Not in this article, in my cloud sales online course that I’m preparing the same very moment you’re reading this text.
2. Getting your name “out there”.
This one is more about marketing than anything else. Marketing done right is vital for sales because a good marketer always wins over a good product. (I’ll come to that later in the post).
The last example I remember took place just several months ago. As a new hire, I had the opportunity to be a part of an onboarding program. One of the sessions, where Marketing presented itself, ended up with a short brainstorming time. The goal was to come up with ideas on how we, technicians mostly, can “get the company name out there”.
For some reason, I remembered the idea to take branded pens to customers and leave them on the desks we work at. The intent was to get our brand noticed and wake up customer curiosity.
Now imagine this. “Hm… A pen with a [consultancy brand name] on it!” – a junior database administrator on your customer site thinks – “I shall google them and see what cloud services they have to offer!” Or “Hm…” – customer’s CTO thinks – “Nice pen! I must buy more from [consultancy brand name here]!..”
You see, this is my problem with mass-market strategies. Just a side note, I don’t have anything against branded pens. They definitely come to good use somewhere else. But let’s have a closer look at this.
Firstly, where is exactly this “out there”? If some money is spent on ads (and sometimes those are not cheap!), why not knowing who in particular the ads are going to be exposed to? Why display them to everybody as Coca-Cola does? Coca-Cola does mass marketing because it’s market is practically everywhere. Everybody in the entire world is their potential customer. That’s why their billboards displayed down the highway – where many people just drive by – makes sense. They are selling volume products to a mass market. A nurse from a local clinic drinks it, a teacher from another half of the globe, a finance consultant, an entrepreneur next door, a student from another country, self-employed yoga instructor, Big Data engineer who moves out from your city right at that same moment as you read this text. Why even try to let these people know that your consultancy helps with cloud services adoption? Your consultancy is niched to a very specific market. And to figure out how to target this niche is not rocket science. Why trying to shoot the rockets then?
Secondly, why not knowing exactly what works in your marketing and what doesn’t? I will be talking about effective and – more importantly – economically reasoned marketing in far greater details in my coming posts. For now, the next point in this list reveals why you are not measuring your marketing outcomes.
3. Rely exclusively on the good quality of your product.
This is why many companies do their marketing by “let us through some money at some marketing stuff just because everybody does it and hope that flashing our brand out there will bring some deals”. They believe marketing is not equally important as creating a good product. They believe their smart, easy to use, brilliant, adequately priced, helpful, innovative, eco-friendly, well build (all of these can be very true) products must be selling themselves. Just let customers know it exists and sales are going to take off, right? Wrong.
A good product is not a tool for attracting customers. A good product is a tool to retain them.
Customers have no idea if it’s any good and they have no means to realize how good your product is until they have used it for a while. Remember the market, the customer going down the aisle, yourself standing there hoping to get noticed? Why should you be noticed? Just because you have the same type of apples as everybody on that spot?
Again, practically, this means that your well-adjusted cloud services portfolio together with the project delivery framework (or what have you) are not going to sell well by themselves. A well-crafted offer will. You have to start from the right end – creating a good services portfolio is GUESSING what market in general needs, crafting a good offering always comes from KNOWING of a particular customer needs right now. This leads me to the next point.
4. Not having control over these three numbers:
a) Customer/Project acquisition cost.
b) Typical project value.
c) Potential Customer Lifetime Value.
What is not measured, is not managed. I bet you heard it before. The real value here is not actually in having control (managing) but in the ability to quickly understand what is going on with your sales. Putting enough effort into the analysis of the a), b) and c) makes the situation with sales clear. And more importantly, going through these numbers is giving a very useful overview of the customer landscape. “Good” and “bad” (good/bad for your business, not as such) customers become easy to identify. How to assess what is “good” or “bad” customer is a topic for an article of itself, I’m planning it already and that’s a reason for you to follow me on LinkedIn and my blog at https://cloudypilot.com.
For now, it’s enough to understand that these three values help to filter out “bad” customers. A good idea is to see if to convert them into “good” ones with the minimum effort appears to be possible. When left with “good” customers only, it’s much easier to craft a compelling offer that leads to a sale. This is because now you know exactly who your customers are. Now, don’t take me wrong here – you still need to find out what exact business pain your consultancy has to solve for “good” customers.
Another very important gain here is focus: filter out customers whose need you don’t want to meet anyway – their acquisition price guaranteed is too high, project value is too low, potential lifetime value is very uncertain. Why spend much energy on “mission impossible”? Freed up time and energy should go to the customers you make more money with.
5. Not executing on a plan for how to get out of HBM* and LGL*.
You have two choices here and they are strikingly obvious:
– Continue to run “business as usual” and grow even stronger at “me too” position.
– Start doing business differently.
The story I’m about to tell here is sad. Once I got myself involved in an interesting situation between two large international enterprises. Company A has been a network and cloud provider to a company B for years. (Company A = potentially could be you. Company B = your customer). I was working at company A and once got mail in a style of “Help! We are losing this big customer. Let’s brainstorm what we can do”. I love this kind of “challenges”. Because they show who is who the very first five minutes of that brainstorming session I got myself into. It appeared that the customer asked for one thing only – be proactive. Company B was moving forward rapidly and felt that company A is too slow, not keeping up and even slowing things down. I suggested doing our homework: analyze what we delivered to the customer, create a future development roadmap based on the analysis, and offer a modernization project. I found all the needed people who could do it. I presented the methodology we could use. Reaction from company A? “Why should we do something the customer hasn’t asked?”.
Everything is obvious here, right? You can do HBM and LGL or you can do the real thing. You can carry on as one of many standing in a queue waiting for the next task from your customer or present a mind shift to your organization and become a leader for your customers.
Your consultancy not getting out of “me too” business models is critically important. For your competitors. They are all delighted about that.
Start doing this:
1. Start with seriously educating your sales department.
The deeper Sales understands cloud the better. A good starting point is the cloud foundation certificate every major cloud provider has. Make your Sales get them. Or at least go the course in order to grasp the cloud fundamentals. That will answer many questions about cloud that Sales has, it’ll bring clarity about what they sell, so they don’t have to invent the wheel each time cloud discussion takes place.
Some consultancies have pre-sale solutions architects. That is a step in the right direction. The next step after that is to hire a person with deep technical skills in public cloud that is interested in sales and business development. Make a new role for this person: Cloud Evangelist.
Again, I’m already planning an entire post about the Cloud Evangelist role. You’ll have to follow me in case you don’t want to miss it.
2. Start serving your niche before the niche needs you.
The next popular thing right now when it comes to the business strategy among IT consultancies is to choose several (or hundreds – why not?) companies as customers – usually, large enterprises – and focus sales department on them. Definitely, that is a step in the right direction: focus on a few particular companies is going to bring more knowledge of potential target groups. That is always good. But how do you know that these companies have chosen you back, though? What is your next step from there?
Is your answer here – the Hope Business Model (HBM)? You hope they put a budget for acquiring services from your portfolio and then you hope they will choose you for the realization of that budget?
So, two moments we are to address here:
a ) serving your niche of customers and
b) doing it before they might need something from what happens to be listed in your services portfolio.
Let’s start by identifying what a niche is. Old school marketers will call it the target market. They would be right. The wrong part comes when with start choosing that market. As I already mentioned, the tradition here is to select the industry and pick the biggest players in it. Every company does that now. Yes, you are “me too” business. And you are a lazy one as well if you just stop there. But this is your lucky day because I have the next steps for you right here:
- Understand what the customer niche is.
- Define one for your business.
- Start giving value (serving) to it before they buy from you.
The customer niche.
It’s your target market narrowed down. (Not any big brand name that just happens to occupy some space on the top).
You’ll need good criteria for selection. There are two perspectives here and you should look at both: who is your customer and who are you.
- Has a particular business need that you have a good solution for.
- Has decided to realize a budget to solve that business need in the near future.
- Its potential business development roadmap makes sense to you.
- Values your work or services high.
- Has the right size that makes possible the desirable outcomes of a potential deal.
- Operates in the right industry.
– Have very profitable services to this market segment.
– Organized for delivering these profitable services quickly.
– A natural addition to their (customers) ecosystem.
A quick note here. Narrowing down the target market doesn’t mean you cannot serve a customer in a completely different market. You certainly can and should. The idea here, though, is to master your niche, start dominating it first. You can take extra gigs on a side but should be focusing on what brings the most value (profit) for less effort (work). The focus works wonders in this case because it, definitely, takes time to master your niche – you need to know your customers well before you are able to give the best of the best service.
Defining one for your business.
As I cannot stress it enough, this is not about just choosing “10 companies we are planning to work with”, call it a “strategy” and hope (HBM) this will magically work out. It’s about knowing your customer’s everyday life. This is about being able to enter the conversations that going on in their boarding meeting rooms at any given moment.
I really mean it. If you are invited to a CTO of the company in your wish list for a meeting and asked questions like: “How do I keep my cloud platform safe and compliant?”, do you have a “secret sauce” kind of answer? Probably not right away. What you should have in your head is at least is a general list of actions any company having cloud platforms should take – a potential roadmap that is. What you should be able to say is: “From the phase you are in right now your next step is…” And the next step. And the next one.
You can do that when: a) you know your product in and out, b) you know who you should sell it to.
No luxury car brand is fishing new customers on “How to stay alive after doomsday” (preppers) conference. People who are preparing for the world goes down scenario don’t spend money on luxury. Why IT consultancy hasn’t learned that yet? Trying to serve everybody leads to serving nobody.
Start giving value.
This is how you enter the conversation in the CTO meeting room I was discussing just a paragraph above. And this is how you do it before they even heard anything about you.
It’s your company blog. Wait for my article about everything that’s wrong with it. For now, I want only to point out one thing seeing in every company blog – the hardcore push of own products. It usually goes like this: an article with a smart title is crafted, the content of it is at least 60% doubtful value to the readers and the rest in the second half is praising the company or its product.
This is not you being an interesting companion in a dialog. This is you shouting behind the counter: “Buy my stuff! I sell this too!”.
So, you enter the conversation by teaching your target market. Teaching the real thing, not where on your website the service portfolio can be found. You should give value, not claim value from the get-go. In practice, that means – you are giving away knowledge and selling execution/application of that knowledge.
For example, why not start simple and make a course on how to get started with cloud security? Then make it into 10 substantial blog articles.
Again, this is your company blog, this is your mail-list, this your YouTube channel, your online course, your educational webinars, your how-to learning breakfasts…
And here is the hard cold truth. If you don’t do it in an organized strategic way, you don’t have an expert voice that customers want to listen to.
That leads me to the next point.
3. Start building influence…
…and see how beneficial this is for your sales. This is a topic for an entire article series and – yes – I’m about to start writing the first one. The topic is very important, it has become vital for any cloud selling consultancy these days. That is why as I mentioned already I’m creating the course right now. It is going to cover every step on how cloud consultancy should build influence the right way – starting long before sales meetings but selling already. 40 steps to incredible cloud sales. You’ll need every single one of them. Nothing today is 40 steps. “Three steps to this and that” – more like. This is not how you build something to hold.
Once I had a colleague. He was a respected expert in his area. You could tell it directly – at our meetings when he talked everybody kept listening very closely. That is because he always had much value to tell. People just didn’t want to miss anything – so, they listened. Was it always like that? Of course, not. He had to start somewhere and build up his expertise.
The same concept works for any consultancy as well: you have to build it before you can use it. The difference between what old school marketing calls “positioning” and actually influencing the industry is huge. Positioning builds on “smart”, “tactical”, “interesting” wording. Everybody is tired of that. And nobody believes it. Influencing builds on sharing the value before getting the value back.
One practical way to do that if you are a mid-size and up consultancy is to create a Cloud Evangelist role who will take lead for getting the company organized around offering portfolio, who will be promoting cloud to the market. The secret here is (again!) in focus: it has to be a dedicated role to bring the results. It cannot be an “initiative” that runs by itself with the occasional help from some employees who, for example, write blog posts of variative quality and topics.
If you are small biz, I suggest you become a cloud evangelist yourself.
One last word about what you’ve just read. Almost every discussed idea here is big enough to put some of us into an overwhelmed state. Don’t do this rookie mistake. It’s all the same with any big idea – you start small. The mistake is not to start at all and let yourself deeper into the mediocre mob.
I’m fully aware that some topics in this article I barely touched. To go deep enough into each more or less a book would be needed. The question if a book on the topic worth writing is still open. What do you think – would you buy a book that outlines a consultancy roadmap for greater cloud sales? I’m convinced about a course on that topic but a book? Please, let me know in the comments below!
Hope, that was helpful… No, I know that was helpful if you have read through to this very line ?. This post is more than 5000 words long.
What I really hope is that the article sparked a thought process that is going to lead to the boost for your cloud consultancy sales. And in coming posts we will be discussing just that in much greater details and depth.