OPINION: Stop selling technology because customers are not buying it

Anton Herbst is the Group Strategy Director for Tarsus Technology Group

by ANTON HERBST 
JOHANNESBURG, (CAJ News) – THE questions that should be keeping every technology reseller and distributor up at night are: “What will our customer experience look like in five years’ time?” and “How do we solve customer problems in a repeatable, scalable manner?” Companies that do not have compelling answers to those questions are in danger of becoming increasingly irrelevant and eventually fading away.

The rise of as-a-service business models has changed the face of our industry at a far quicker pace than we anticipated, even though we started to set up our first cloud businesses nearly 10 years ago. Following the trend, we have seen in television (Netflix), personal transport (Uber), and music (Spotify), technology customers are looking for on-demand solutions and services.

Whether we are talking about an IT manager at a mid-sized manufacturer, an entrepreneur running a marketing agency, or a suburban consumer, they are all tired of being sold the latest and greatest technology. Think about it: when last did you see people queuing around the block to get the latest tablet or smartphone? People are just not as excited about product as they once were.

This trend is likely to accelerate in the wake of the COVID-19 pandemic – people are getting more accustomed to living, shopping and working in a virtual world. Having experienced the ease and power of today’s digital channels, they will be no rush to go back to the old technology purchasing experience. What customers want, instead, is for companies to solve their problems in the moment.

Solutions in the moment

In much the same way as they’ll call up Netflix when they want to be entertained, they want to spin up the software or access the service that meets a business challenge or answers to a lifestyle need. The answer they are looking for – apart from niche markets like gamers and hobbyists – is seldom just technology.

Rather than preoccupying themselves with product specifications, they want to know how a company can help them meet a goal or cure a pain point. This might not even involve them owning a device or product – instead, they are increasingly expecting to be able to pay for services per-use or per month.

For example, if you’re running a small business, you are not interested in owning licences for Microsoft Teams and a bunch of PCs and tablets. What you want is to know that your employees, freelancers and contractors can collaborate easily wherever they are. If you can achieve that goal without owning devices and software, so much the better.

Or if you’re in retail and your sales peak from Black Friday to Christmas, you want to be able to process transactions at the point of sale and on your website with no downtime or disruption. You don’t, however, necessarily want to know about the technical specs of the back-end technology that makes it all possible, or to own infrastructure that you’ll own really put to work for a few weeks a year.

Most IT resellers and distributors – indeed, incumbents in most industries, full-stop – are struggling with this transition. We are used to flogging product because that’s what we have in our warehouse. It’s likely to be a poor model for the future when people are moving away from owning stuff. Look at Netflix, people don’t want to buy the DVD (the product) – they want to be entertained (the outcome).

Data-driven marketing

Companies that succeed in this world will be masters of data-driven marketing rather than of pushing product. They will gather data – in a way that is respectful of customers’ privacy and security concerns – and use it to craft the right offer in the right moment for each customer. This will be about reengineering the customer experience to give people what they actually want and need.

Again, it’s important to note that many customers who never used ecommerce much or at all before are being forced to shop online for everything from household necessities to business solutions. Physical channels and face-to-face interaction have been side-lined with customers doing their own research online rather than speaking to a dealer for advice.

In our own business, we have realised that the returns on hard selling are diminishing. We are increasing our investment in marketing to keep pace with our customers. The discipline is less about the hard sell than about building capabilities to customise offerings for customers and deliver them at the precise time they are needed. Artificial intelligence (AI) and big data will have a crucial role to play here, but so will something else that the IT industry sometimes forgets about: speaking to the end-user.

The reality is that products have become commoditised and the differences in the specs and features are not going to matter much to most users. What does matter to them is the utility they get from their relationship with a company. The companies that will lead in the years to come are those that are able to listen to what customers want and rapidly respond.

– CAJ News

NB: Anton Herbst, group strategy director, Tarsus Technology Group

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