Is Demo Short for Demolition?
Earlier this week I spent two days with a technology company client in New York City. As with every other tech company with which we’ve been engaged, I was asked about my opinion on demos. The discussion prompted this post.
On the sell-side, the precise approach to demos will differ company-by-company, product-by-product. Selling iPhones? Demo early and demo often. Selling a relatively undifferentiated piece of application software? A early, generic demo will further commoditize you in the eyes of your prospect. You’re just asking to be in a bake-off and ultimately a price battle, because you are drawing their attention to common features, not how you can uniquely improve their business.
On the buy-side, the lower down in an organization you’re selling, the more important the demo is. One of the best salespeople I’ve ever worked with always sells high in his customers’ organizations. He still says, “The best demo is no demo.” He’s closed many multi-million dollar deals without his SE (sales engineer) having given a demo. “With our software, there is absolutely no upside giving a demo. But the risk is substantial, so I avoid them unless not doing one will cost me a deal.” He doesn’t sell sexy iPhone apps.
Sam Reese, CEO of Miller Heiman, wrote a post a few weeks ago on the subject. It’s a short post, but covers a couple of critical points. It’s worth the read.
Another consideration: When you’re selling software into companies with an IT organization, sometimes they’re your toughest competitor—not the other software company. Giving IT an early demo without having already established your credibility with the business managers who need your solution provides IT with an opportunity to learn about all the reasons you shouldn’t be considered. They could easily block any further progress by providing evidence to those business managers why your software just won’t get the job done, be compatible with the current architecture, etc., etc. Hold off on the demo, and you can have the time to immunize the business managers against the inevitable IT nay-saying.
There are a lot of things to think about when formulating your company’s demo strategy. For a technology company, this is a critical component of building an effective sales process. Doing a demo as an unplanned reaction to a customer request (or demand) is never the right approach. Neither is letting your salespeople lead with a demo because they don’t know how to carry on a discussion with the right people about the customer’s business.
Photo: © James Steidl – Fotolia.com
Filed under: Sales Strategy, Technology
Hi Dave, some very good points made there. A friend in the TV business once told me he never has animals or children on a live show – perhaps we should also add software to that list.
Having said that I have come around more and more to the demo in recent times – but I do believe that it should be short, sharp, rehearsed and have a very precise point to make – and be used to emphasise your differentiation. The purpose after all is very often to help a customer understand “why you”. A crisp demo achieves this and I think the customer appreciates it.
I think that the rules have shifted quite a lot in the last decade.
Regards,
Hugh
Thanks, Hugh.
I just want to make myself clear. It’s doing demos with an undifferentiated product that gets you into trouble. If your solution does have differentiators, and you can demonstrate how the customer will derive unique value from those, configuring a demo with their data can be quite effective.
It’s the dumb demo that I’m writing about…
Most of the IT companies that we encounter believe that they should demo immediately upon identifying a prospect. This usually is an edict handed down by top management who believe that the demo will close the sale. So, their sales force is instructed to “sell the demo.”
That strategy usually produces poor results. Then they look for outside help to teach their salespeople how to do a better job of selling the demo.
We advise our software clients to hold off on demos until the entire sales process is completed. Then, they use the demo to close the sale by demonstrating that the software meets the prospects’ specified conditions of satisfaction.