Every business knows that digital transformation is the key to thriving using the latest technology and tools.
Research among 100+ industry professionals revealed some insights on Digital Transformation and the usage of CPQ software to transform sales processes through automation as a part of their digital journey.
A Gartner report says that 56% of CEOs have increased revenue generation via digital improvements. 41% consider following a business case or roadmap with a digital strategy as a critical aspect in making the digital business successful, and less than 30% of firms are actively taking digital transformation initiatives despite partnering with technology vendors. Services (95%), Healthcare (92%), and Financial Services (93%) are a few of the top industries among these companies that have a digital-first business strategy.
As a Digital Transformation Service Provider, the Dextara team wanted to know the practical challenges these companies face while transforming digitally, even after having a digital-first strategy, Sales automation tools, and technology vendors to avoid failures.
There is no doubt that companies required Digital-savvy leaders, Cultural transformation, and Digital Integrations with digital strategy altogether involved in the success of the digital transformation.
Leveraging a new tool and technology to fill a gap in business is as crucial as having a vision, purpose, usability, adaptability to changes, support, and a well-integrated system to gain the intended outcomes of digital transformation.
Prior to the pandemic, McKinsey Global Survey: More than 80% of respondents say their organizations have undertaken digital transformations in the past five years. Yet success in these transformations is proving to be elusive.
Success rates also vary by company size. At organizations with fewer than 100 employees, respondents are 2.7 times more likely to report a successful digital transformation than are those from organizations with more than 50,000 employees.
According to Mckinsey Global Survey, the operational IT advancements and a fundamental change in mindset with a focus on Customer Xperience (CX) and satisfaction while transforming digitally can generate 20% to 50% of the business economy. However, the way the pandemic has caused a major disruption in businesses on a global level, digital transformation has become a thing of necessity.
According to Markets and Markets, the global digital transformation market size was valued at USD594.5 Billion and is preceded to reach USD1548.9 Billion by 2027.
Complex products & pricing were the biggest challenge for the companies that disrupts their revenue plans along with other factors like a suboptimal CRM, lack of advanced tools, and difficult renewal process. The concept of product complexity has become increasingly important over the past few years as customers demand higher-quality solutions from companies.
At Dextara, we helped companies to accelerate their sales and improve their customer experience with the implementation of Dextara CPQ within 2 weeks.
95% of the industry professionals strongly agree that CPQ solution is necessary for every business in our survey.Many companies are aware of the potential benefits of advanced CPQ software in transforming their selling processes by overcoming the challenges of selling complex products.
The global market of CPQ software is estimated to reach $3.5 Billion by 2026. Our findings indicate that most companies are aware of the benefits of CPQ software like improved Customer satisfaction, faster Turn Around Time, reduced quoting errors, Efficient Sales processes, and others.
Most companies use Salesforce, SAP, Oracle, and Conga CPQ solutions. In contrast, there are 33% of the remaining companies don’t use any CPQ solution; a few companies use custom-built CPQ software and other CPQ solutions.
According to our survey, it is found that sales and product teams of these companies have primary challenges with the complex configuration process during and after the CPQ implementation and secondary with lack of Out-Of-The-Box features in a CPQ solution along with tricky terminology.
These CPQ implementation challenges are due to the disintegration of IT systems and CPQ software, lack of product knowledge, collaboration, transparency, training, and advanced CPQ features.
Generally, any company uses CPQ software expecting to streamline sales processes with error-free configuring, pricing, and quoting.
Though the complexity still lies around product configuration, price, and quote, fortunately, by implementing advanced CPQ features for customizing product configuration, price management, upselling and cross-selling, subscription management, and quote generation, we can simplify the complexity that currently exists around these areas.
Upselling and cross-selling options in a CPQ solution can help businesses generate more revenue. A report infers that cross-selling alone has been shown to boost sales by 20% and profits by 30%.
The chances of selling products and services to an existing customer are as critical as offering products and services to a new one. So, cross-selling and upselling are great ways to retain customers and make more sales via relevant recommendations during the buying process.
Our survey finds that 86% of companies use the Sales tech tool like CPQ for cross-selling, and 14% plan to upgrade as a part of their sales automation and digital transformation journey.
The CPQ software should have the customization features to manage the pricing strategy, which is critical in avoiding business losing customers, sales, and revenue.
Our survey implies that 60% of sales professionals use CPQ software that is highly efficient in handling feature-based price variations, rebates, discounts, and profit margins. In contrast, the remaining professionals use CPQ software with limited functionalities for price management.
66% of the industry professionals use CPQ software that supports features to do block price and volume price in the same pricing model. On the other hand, 17% say that their CPQ software supports these features to some extent, but they need to customize, and the remaining don’t use CPQ software that allows them to do price management at volume and block levels; hence they need to work around.
Along with Price management, managing subscription renewals is one of the biggest CPQ implementation challenges a business should plan to overcome. Usage-based pricing allows users to use and pay for certain services.
Furthermore, businesses can easily identify the heavy users based on subscription renewals, plans, accessible features, and other pricing factors and offer special benefits to them.
Our survey indicates that 75% of the industry professionals already use a CPQ that supports Usage-based pricing for subscription renewals, whereas 11% use fixed/flat-based pricing for one product/service at once.
On the other hand, 7% use tiered-based pricing to use specific products/services on paying a certain amount at each level, with a price ranging from normal users to premium users. On the contrary, the other 7% use per unit/user to use a product/service by a specific user.
The Dextara Analyst team conducted this survey as a part of our CPQ research and development initiatives to extend the functionalities of our 100% Salesforce native Dextara CPQ Software.
To summarize, businesses must prioritize digital transformation and technology adoption, particularly CPQ software, to address complex challenges and stay competitive. For more info on CPQ Software, connect with our CPQ consultants at email@example.com. Keep following us for the latest updates and insights.