By Gennifer Biggs, Business Solutions Magazine
This data collection and management integrator retooled its value proposition to overcome Internet competition and position itself for future growth.
Alpha Systems has been in the business of data collection for nearly three decades, but recently it had to adjust its approach to sales to overcome some barriers presented by customers who know just enough about technology to be dangerous, as the old adage goes. When you cross technologysavvy customers with the Internet and lowcost component vendors marketing “turnkey” solutions, integrators such as Alpha Systems are faced with a conundrum. The integrator was challenged to sell its own expertise rather than pitching technology.
Communicate Value Of Data Capture Expertise To Win Sales
Alpha Systems, which is part of the Hunkar Technology family of services providers, is a data capture and management integrator that has seen a clear shift in its business during the last several years. Joe Panella, VP of sales for Alpha Systems, and Robert Cook, president and CIO for the integrator, say it was a year or so ago that their sales team noticed that, more and more often, the sales conversation with customers was focusing on the value offered by Alpha Systems, not individual components in a data collection solution. “As time went on, we started to see more plug and play devices, and our customers were getting increasingly comfortable with turning to the Internet for solutions; they didn’t think they needed our help,” explains Cook. “And as our customers became more educated, it changed the way we do business.”
Those customers started asking, “Why am I paying Alpha Systems a premium for a solution that I think I can put together myself?” and Cook and Panella realized they needed an answer for that question. “In the early days of data capture, our customers were just happy to find someone who knew anything about bar coding. Today, so many people feel they can buy technology on the Internet and don’t need additional help that we had to learn how to showcase our value,” says Cook.
Overcome Capital Expense Objections
Panella and Cook agree that the type of customer the integrator serves is one reason why their company needed to better articulate their expertise and the cost savings they can drive. Alpha Systems is particularly effective when working with midmarket customers, those with $50 million to a half billion dollars in annual sales. The reason is simple — those midsize businesses are large enough to have sophisticated data collection and management needs, but don’t have the internal resources to develop and manage a full-fledged solution. They are also under tight cost constraints, which make those alleged “all-in-one” Internet deals alluring. One way Alpha Systems helps overcome capital expense objections is to raise customers’ awareness of the hidden time and resource costs of an in-house solution. “We focus on making the customer understand the unforeseen overhead it faces — time and resources needed for configuration of devices, troubleshooting of the infrastructure and connectivity, and management of the entire system,” explains Cook. “We explain to them that we know what questions to ask and what issues to anticipate. We’ve done deployments in their vertical before, with this same equipment, and we can save them from an expensive learning curve.”
Convey The Value Of Customized Turnkey Solutions
The integrator found itself doing some soul searching and ultimately took action to better define its value proposition and then accurately communicate that value and the company’s philosophy to customers. “We focused on ways we can reach customers before they make a purchase, and we educate them on the pitfalls [e.g. deployment/configuration time, learning curve] of blind purchases over the Internet,” explains Cook. The sales team started brainstorming every month, highlighting a new success story and working together through the steps to that win. “We talk about how we found the opportunity, what was in the proposal, what objections we had to overcome, and how we did that. That process helped us develop concrete examples of our value to share with our customers,” says Panella.
Part of that new customer communication strategy involved a revamp of the company’s website. “We offer solutions that are A to Z, everything from the products to create and print bar code labels to the hardware to collect the data and the software to manage it — all integrated together seamlessly. That is our value proposition for customers, but our website was muddying the water,” he adds. Alpha Systems decided the existing version of its website, which looked more like a product catalog, wasn’t reinforcing its message of comprehensive and custom data capture solutions. An overhaul eliminated that problem, and today, the website communicates the vision of Alpha Systems, presenting information on the integrator’s experience with verticals such as education, healthcare, and manufacturing and establishing how its valuable expertise leads to turnkey solutions custom-built for each customer.
The Search For A New Type Of Vendor And Customer
Another change the integrator made was to limit its vendor partnerships, building expertise around vendor product lines that offered clear differentiators when it comes to sales proposals. “We work with vendor partners that offer full product families that can meet the needs of all our customers,” explains Cook. Key to that relationship, he adds, is a willingness on the vendor’s part to create a close partnership that ensures growth for both sides.
The effort to build deep relationships with a limited number of vendors paid off as new food tracking regulations started to impact small food preparation businesses. Those businesses appealed to industry-leading vendors in the barcoding space for guidance. References from those vendor partners led to several engagements for Alpha Systems, business the integrator might have missed if it was just one more partner on a large vendor’s shipping list.
With those changes in place, Alpha Systems started pursuing a new breed of customers. “We looked at our marketplace and understood that those places where decisions were made on the basis of price were not the kind of customers we wanted,” says Cook. Instead, the integrator started identifying customers and verticals where more sophisticated solutions were in demand and focused its efforts there. One market opportunity it has identified is wireless mobility. Not only can Alpha Systems offer insight into the choice between smartphones and purpose-built rugged data collection handhelds, but if it loses that battle, the integrator typically finds a wireless infrastructure win remains.
BYOD And Big Data Offer Lucrative Future Sales
Like many other solutions providers, Alpha Systems is not only adjusting and maturing to take advantage of changes in the data collection landscape, it is seeking ways to soften the ebb of revenue between projects. There again, Cook is looking at the impact of mobility and the growing “bring your own devices” (BYOD) trend. “We’re hoping to create a recurring stream helping our customers prepare for BYOD, especially when those devices are used to gather and store data. We can help guide them toward best practices for managing those devices. They will need help with security, connectivity, data management, and managing the volume of traffic on the network, which again is where our experience comes into play.”
Cook also sees opportunity on the horizon when it comes to a growing interest in Big Data. Alpha Systems is preparing to show its customers how to turn all the data they’ve collected and stored into usable information that can reveal potential areas for improvement within the business. “We will offer services to help our customers get that data consolidated and then mine it,” explains Cook. “All of that is a value we can add because we have a specific focus on data collection, every aspect of it, and we can offer expertise our customers could never afford in-house. The key is to communicate to them how that expertise translates into cost savings and increased productivity.”
For Alpha Systems, a willingness to look hard at its own value proposition has paid off. The integrator is on track to achieve a 25% revenue jump by the end of 2012, much of which is built off wins with those midmarket customers willing to pay a little extra for solutions that deliver on a promise to cut costs and increase efficiencies. The next trick will be for Alpha Systems to mature those relationships into ongoing engagements about BYOD and Big Data, an opportunity many integrators will miss if they don’t stay forward focused like this team has done so successfully.
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