2. CONFIDENTIAL 2
CPQ has transformed from a linear process to a multi-touch, multi-threaded customer
engagement lifecycle…
Success
Renewal
Cancel
Request
Upgrade/
Downgrade
Initial Sale
IPD
Engagement w/
Customers is a series
of Touchpoints &
Lifecycle events
CPQ CONUNDRUM
4. Company A: Widget Corp
CONFIDENTIAL 4
TRADITIONAL CPQ
“Buy all of the
widgets!!!!”
• Sell the customer as much as possible in any single transaction.
• Offer discounts on add-ons if purchased at the same time.
• Greater flexibility for the customer but may result in customer
feeling confused and as if there are many hidden costs.
COMPANY GOALS:
5. Traditional Business Model
• Product/Revenue mix: Hardware & Networking Equipment (60%),
Services & Support (25%)
CONFIDENTIAL 5
WIDGET CORP
TRADITIONAL CPQ
Customer-facing CPQ Workflow
Product
Line
Core
Product
Required
Add-
ons/
Features
Optional
Add-ons
Service &
Support
Options
• Works well for one-time transaction but not for relationship-based
selling
6. TRADITIONAL CPQ
CONFIDENTIAL 6
WIDGET CORP
One-time Interaction
We are selling you these things and we want to maximize that
sale now
Configure the widget Add options
7. CONFIDENTIAL 7
Company B: Cloud Inc.
“Come check us out so
we can start forming a
relationship and
offering value add
services & products.”
CLOUD CPQ
COMPANY GOALS:
• Customer acquisition: GET YOU IN THE DOOR
• Form a relationship, upgrade, and retain
• Want you to feel like you’re getting all these features for only
$X!
8. CONFIDENTIAL 8
Cloud subscription business model
• Product/Revenue mix: 90% recurring subscription business, 10%
based products
CLOUD CPQ
CLOUD INC
Cloud Inc Imperatives
• Rely on recurring revenue (generally only break even in year 1 for
paying customer)
- Have 100+ features and products inside core platform
• Cloud Inc initially tried CPQ: let the user pick their features
• Customers tended to choose fewer features to reduce price
• Cloud Inc has several core product features directly tied to
retention: they need customers to use these features to see
great value out of their product
10. CONFIDENTIAL 10
PROS
CLOUD CPQ PROS AND CONS
Cloud Inc must fight to keep customers engaged so that they continue paying for the
service
Cloud Inc offerings are transparent Clear difference in packages offered
Cloud Inc has a recurring revenue stream
Cloud Inc has vast upsell opportunity to their install base
Focus on ease of sign up and the transparency of the monetization strategy
CONS
Cloud Inc must sell you the value proposition of add on services and upgrades
Cloud Inc needs a CPQ system/method that provides the flexibility necessary to manage
the entire customer lifecycle
11. DRUMROLL PLEASE
Cloud Inc = Demandforce!
• Cloud based marketing and communications platform
• Many features and value add services that drive customer growth and
retention
CONFIDENTIAL 11
WE HAVE A SECRET TO SHARE
Attach
Renewal
Save/
Retain
Sale
Our
Lifecycle
VIDEO!
12. Demandforce’s Lifecycle Management Roadmap:
CONFIDENTIAL 12
• Un-package and re-bundle charges & discounts
• Allow for greater pricing model flexibility
• Enable any-time upgrades and downgrades
• Restrict (AE) choice with configurable logic
GOAL: ALIGN QUOTING AND
PRICING CAPABILITIES TO DF
CUSTOMER LIFECYCLE
QUOTING & PRICING ROADMAP
-CPQ has traditionally been a linear process. That doesn’t mean it hasn’t had it’s own complications, input and decision points, and interaction model
-However, subscription CPQ has different demands and therefore requires a different solution….
-Would like to tell the story of how this impacts business and plays directly into company strategy in a very real way using a few fictitious companies: one traditional hardware manufacturing and distribution company and one cloud based subscription business
-CJ to provide image that resonates with Widget Corps core strategy and business model
-CJ to provide image that resonates with Widget Corps core strategy and business model
-Currently charges are bundled together because there was not a way to separate them but force flow (assisted selling / bundle validation)
-AE has a lot of choice of what product to choose based on what type of singup this is: system is not doing the work for them and limiting choice only to what is applicable to what they’ve previously told us about the customer
-Currently Add on products are selected at signup through quoting flow and manually processed if added later
-Future goal would be to have quoting flow use amendment type/lifecycle event as input to product selector page
-Goal is to allow any logical relationship to the customer record from SFDC be a possible input into the quoting flow
-We will accomplish this using the new features released in Titanium and the future release of Guided Selling and the product selection enhancements
-This will allow us to separate subscription, usage, and setup and discount them separately while forcing selection of each component, it will allow us to build amendment flows for cancellation/save and upgrade/downgrade that are independent of new signup flow
-Revisit previous slides and reference changes