Visual CPQ shortens sales cycles, improves sales-engineering collaboration, maximizes margins, drives customer satisfaction, and boosts revenue by an average of 168%. That sounds like a lot. And it is! But it won’t work for every business.
This article identifies and explores the five characteristics of companies that stand to gain the most from visual CPQ.
- They sell highly complex, manufacture-to-order products.
- They have an extensive product catalog with loads of variations and dependencies.
- They operate in a fiercely competitive industry and need a core differentiator.
- They’re making the transition from in-person to remote selling.
- They’re searching for a way to improve their eCommerce performance.
What is Visual CPQ
Visual CPQ is software designed to automate, streamline, and enhance a three-step process common to all manufacturers and wholesalers of configurable products. These three steps are (1) configuration, (2) pricing, and (3) quoting.
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What makes visual CPQ unique is that sales reps and end-customers configure products by interacting with 2D or (more often) 3D product images rather than relying on lengthy descriptions and neverending catalogs of part numbers.
Let’s take a look at how those three steps work in more detail.
Visual CPQ Step #1: Visual product configuration
With visual CPQ, users configure products within a highly intuitive 2D or 3D interface called a visual product configurator. They simply drag and drop to move parts around on-screen, switch colors, change dimensions, upgrade features, and more. As they do, computer-generated product images evolve in real-time on-screen.
Most people have at least a vague idea of how visual product configuration works. They might have used a simple visual product configurator to change colors or materials when shopping for a pair of running shoes online.
Visual CPQ takes this concept and applies it to highly complex (and considerably more expensive) products such as bioprocessing tools, modular buildings, and heavy equipment. Sales reps or end-customers with limited product knowledge can configure these products from scratch.
How does it work?
Product rules programmed into the back-end of the configurator ensure that every product is optimized for engineering efficiency, profitability, and customer satisfaction. They also eliminate mistakes. Engineers can be confident in the knowledge that sales won’t pass them half-assed napkin sketches. And those at the top of the organization know that margin is being maximized in every transaction.
Visual CPQ Step #2: Dynamic pricing
As users configure products, visual CPQ software calculates prices in real-time. You can hide prices from view (perhaps your sales team wants to adjust prices post-configuration), or you can push them to the fore, making them a central component of your buying experience – customers can experiment with combinations of options to optimize products without overstepping budgets.
A robust visual CPQ solution makes the pricing process as complex or as straightforward as you like. More basic: it simply pulls data from your ERP’s static price lists. More advanced: it applies logic, adjusting prices according to fluctuating market conditions such as demand, competitor prices, customer history, or inventory level.
Visual CPQ Step 3. Quote generation
Visual CPQ auto-generates quotes, saving sales reps from the burden of Excel. In addition to quotes, a robust visual CPQ generates estimates, proposals, marketing collateral, terms & conditions – whatever is needed to get the deal done.
A visual CPQ solution like KBMax auto-generates more than just PDFs. It generates CAD files, technical drawings, BOMs, CNC cut sheets, and assembly instructions for the manufacturing floor. It streamlines the entire engineer-to-order process, from initial customer interaction right through to the finished product.
Is Visual CPQ Right For Your Business? Do Any of These Things Sound Familiar?
The most suitable CPQ for your business is the one that saves you the most time, makes you the most money, and provides the best customer experience. If any of the following five descriptions match your business, then a visual CPQ will provide you with a far higher ROI than a run-of-the-mill text-based alternative.
1. You sell highly complex, manufacture-to-order products.
If you sell highly complex products, then conveying intricate product details to customers (in a way they truly understand) is hard. According to “science,” not to mention common sense, it’s far easier (60,000 times easier to be exact) to convey information through visuals than it is through text.
If you want to give your customers a comprehensive understanding of complex products and their benefits, then show, don’t tell. It’s the best way to reduce purchase anxiety and increase your win rate. KBMax increases annual sales by an average of 168%.
2. You have an extensive product catalog with a ton of variations and dependencies.
You can’t expect sales reps to wrap their heads around hundreds or thousands of product options. Still, without extensive knowledge of your entire product catalog, it’s impossible to configure truly optimized products. Instead, sales reps play it safe. They “stick to what they know.” They fail to maximize profit and customer satisfaction with retention suffering as a result.
Visual CPQ makes it easy for sales reps to configure optimized products every time. “Guided selling” walks them through a series of questions designed to surface the right choice for the customer. And product rules eliminate compatibility issues and mistakes.
3. You operate in a fiercely competitive industry and need a core differentiator.
Visual product configuration capabilities mark you out from the competition. With visual CPQ, you can provide a fully immersive buying experience that’s just as flexible and convenient as it is compelling.
Sky’s the limit when it comes to the visuals. Combine 3D CGI with augmented and virtual reality to transport buyers into a simulated reality. Here they can interact with customizable products in a more compelling environment than any physical showroom. Let customers upsell themselves and stimulate word-of-mouth.
4. You’re making the transition from in-person to remote selling in a post-covid world.
Remote work is here to stay. A recent Upwork survey of over 1,000 U.S. hiring managers predicts 22% of the American workforce will be remote by 2025 – an 87% increase from pre-pandemic levels. This percentage will be significantly higher for those in largely desk-based roles, such as procurement.
With buyers working from home, you need to bring your products to your customers through their screens, precisely what you can do with visual CPQ. It’s the perfect post-pandemic solution for manufacturers who traditionally relied on face-to-face sales rep interactions.
5. You’re searching for a way to improve your eCommerce performance (KBMax increases conversion rate by 40%)
“Channel shift” towards B2B eCommerce has been accelerating for years, but the pandemic has thrust it into overdrive. Today’s buyer carries out extensive online research before making any purchase – business or personal – and usually buy from the site that provides the best (which often means the most B2C-like) buying experience. Interacting with a sales rep is often the last resort.
KBMax users can integrate their CPQ with their B2B eCommerce platform, embedding their visual product configurator onto their website. End customers can configure, price, and quote products independently without any sales or engineering input – a total game-changer. They can interact with your products any time, through any device, wherever they happen to be located in the world.