Michael D. Moberly February 18, 2014 ‘A blog where attention span really matters!’
Respectful suggestions to security product developers, manufacturers, marketers, and sales…
Let’s start by accepting the economic fact that an expanding majority of our work, business transactions, R&D and manufacturing, etc., occur in a ‘globalized’ economy that is increasingly rooted in intellectual, structural, and relationship capital, i.e., intangible assets which now constitute 80+% of most company’s value, sources of revenue, and ‘building blocks’ for growth, sustainability, and profitability.
But, let’s also accept another reality, which is, while the above economic fact is routinely born out in numerous studies, starting, in my view, with The Brookings Institute’s Intangibles Project evolving over several years in the late 1980’s and early 1990’s culminating in the publication of ‘Unseen Wealth’ authored by Margaret Blair.
Unfortunately, however one may wish to call it, e.g., an economic fact or new business operational reality, neither has yet to become so self-intuitive to be permanently affixed to management team and c-suite radars or dashboards.
The initial step is to develop an understandable ‘pitch script’…
Regardless, this irreversible consequence of an economy and its business transactions being rooted in intangible assets, it becomes all the more essential for security product and/or system R&D, manufacturing, marketing, and sales to develop ‘pitch scripts’ that bring clarity to prospective clients – buyers insofar as recognizing the various ways a company can elevate its value, add sources of revenue, and solidify its sustainability, profitability, reputation, stature, image, goodwill, and relationship capital, merely through effective utilization of intangible assets already embedded in security services, products, and/or systems.
Too, a well designed and articulated ‘pitch script’ that brings clarity to security intangibles will elevate prospective client – buyer receptivity to paying a premium and also recognize the return on security investment (ROSI) that ‘security intangibles’ produce to favorably affect a company’s bottom line.
Well developed and articulated pitch scripts, says Dale Furtwengler, an especially intuitive St Louis-based business strategist and author of ‘Pricing for Profit: How To Command Higher Prices For Your Products and Services’ play a significant role in increasing the probability prospective clients/buyers will be inclined to make quicker buying decisions, while again, paying a premium.
Bringing real circumstance-environment specific clarity and relevance to ‘security intangibles’ also contributes to company’s achieving their strategic objectives. For example, when users of an environment, e.g., retail, office space, etc., feel (sense) their environment respects their patronage and/or productivity by introducing relevant security measures the outcomes are experiencing elevations in repeat customers – clients, or achieving a more productive and elevated employee retention rate.
Furtwengler also points out that the more clarity sales persons bring to buyers…
- leads to more informed decisions, and
- reduces the probability that buying decisions will be postponed.
A critical prelude to achieving success, Furtwengler emphasizes, and certainly no disagreement here, are that effective ‘pitch scripts’ must also describe…how to calculate the monetary value of the intrinsic (intangible) value which a vendor or consultants’ services and offerings will actually provide!
Furtwengler’s experience tells us further that when prospective buyers find themselves unable to distinguish one vendor’s services, products, or systems from another’s, a prospective client/buyer will likely and quickly turn to the conversation to (product) pricing. When this occurs, it generally translates as…
- the act of articulating and/or distinguishing the intrinsic (or, intangible) value a security product produces has not been effective, thus
- a prospective client or buyer may be inclined to view similarly competing offerings as distinctions without a difference.
That’s because, when this critical component is not credibly integrated into one’s ‘pitch script’, pricing becomes the dominant differentiator because many prospective buyers believe price to be the only remaining means to distinguish proposals and is something which business decision makers readily understand.
Furtwengler, certainly an experienced practitioner, draws attention to another reality, which is, most prospective buyers actually ‘expect to pay more to get more’, but only if ‘getting more’ adds actionable value and is recognizable to them, or users or consumers as a positive.
While acknowledging other issues and/or dynamics may be in play, Furtwengler wisely translates this as a vendors’ ability to…
- achieve quicker buying decisions, and command higher fees is substantially dependant on their ability to
- articulate the greater (security intangible) value their product and/or service will produce, coupled, of course, with a
- demonstration of specific strategies how that value can be monetized to benefit the buyers’ respective needs and demands as well as those of the users environment.
Admittedly, as Furtwengler respectfully emphasizes, and, as an intangible asset strategist, I must agree, it’s important to recognize that ‘the greater value’, i.e., security intangibles, initially derive from the deployment of tangible – physical assets, i.e., security products and/or systems.
It is at this point that Furtwengler describes the necessity for ‘value propositions’ which are what most prospective buyers of security products and systems will attach value to which I have taken some liberties of Furtwengler’s work, conveyed below, to hopefully render value propositions specifically relevant to security product-system sales. That is, value propositions should include, at minimum, these five components, i.e., security…
- Products’ innovative image: As this accrues it can manifest to elevate a company’s image and stature by being associated with and deploying specialized (leading edge) security – asset protection products.
- Vendors’ integrity and trust worthiness: As this manifests during sales calls, it manifests as reducing the amount of time required for a prospective client – buyer to make their buying decision.
- Product service and dependability: Simply stated, this means ‘doing it right the first time’ so clients-buyers do not lose time, patience, or deplete the products’ image and integrity of the vendor later due to expensive remediation and ‘down time’ before product/system deployment is fully operational.
- Vendor and/or sales reps’ must be very knowledgeable about the product or system they are selling: This translates as time savings. That is, one who knows their product well and can clearly articulate same in understandable terms, are helping prospective clients/buyers to recognize (a,) what they really want, need, and value to mitigate risks/threats,(b,) relative to their specific circumstance or environment.
- Speed andconvenience of the products’ integration/application into the buyers’ environment: For a prospective client this translates as time savings which can be a significant factor in buy – don’t buy decisions, especially when (a.) there are similarly competing products in play, and (b.) there is an immediate need for a particular security – asset protection product.
The ‘FUD’ factor…
I have never been a proponent of utilizing the FUD factor, i.e., sewing seeds of fear, uncertainty, and doubt in the minds of prospective clients-buyers perhaps through highly dramatized examples, as being a very respectful persuasion tool. I admire Furtwengler for excluding this still widely used practice, particularly when security, risk, and threat issues are in play as a presumptive starting point for a sales call. Admittedly, playing the ‘FUD card’ may be difficult to resist, especially if a prospective client has already had a risk – threat materialize, but still exhibits reluctance, dismissiveness, or is slow to make a buying decision.
Fortunately, I now see more security product-system vendors who previously found comfort in commencing sales calls with dramatized narratives that included highly subjective FUD factor aspects, now opting to incorporate variations of ‘security intangibles’.
I am most confident, security product developers, manufacturers, and vendors would be well served by adapting and incorporating variants of this language in their marketing/promotional materials and sales pitch scripts. Again, the rationale for incorporating this language is that today’s business environment is global, increasingly competitive and predatorial, and dominated by intangible asset intensive companies, whether their leadership – management teams’ acknowledge it or not.
In other words, it’s obligatory today that security product’s, and how they are developed, manufactured, marketed, promoted, and ultimately ‘pitched’ reflect these irreversible and paradigm shifting economic facts and business realities particularly as management teams, c-suites’ and boards become more operationally familiar with intangibles and their associated fiduciary responsibilities.
Inspiration for this post largely rose from various messages conveyed in Dale Furtwengler’s fine book ‘Pricing for Profit: How To Command Higher Prices for Your Products and Services’.