Traditional text-based CPQs are starting to look dated. They were built for a simpler time–a time of mass production. Back then, all manufacturers did was pump out the same standardized widget in endless quantities. But now the world has changed.
Mass production is steadily giving way to mass customization. Customers are demanding configurable products. And traditional software solutions are struggling to cope.
It sounds like the death toll has rung on CPQ…Or has it?
Quite the opposite is true.
The CPQ market is expanding. It’s expected to grow by $1.65 billion between 2022 and 2026. What’s fuelling this growth? The addition of 3D product visualization and self-serve options. Traditional CPQs might be dead, but the latest breed of visual CPQs is more alive than ever.
This article discusses why traditional CPQ software solutions are going the way of the landline. And how manufacturers are leveraging advanced CPQs to achieve staggering improvements across their business, including
- 40% increase in conversion rates
- 26% increase in sales reps achieving sales quota
- 100% increase in deal size
If you’re new to CPQ–or your existing CPQ’s not cutting it anymore–you’ll find lots to get excited about below.
Factors Driving the Evolution from Traditional to Visual CPQ Implementation
Below are some critical factors driving manufacturers toward advanced CPQ adoption right now.
1. Rising B2B Buyer Expectations
According to 66% of companies in Zendesk’s 2022 CX Accelerator report, customers today are less patient than ever. 43% of B2B customers don’t want to interact with a sales rep, which means understanding and delivering on customer expectations is tricky. Allowing B2B buyers to self-serve is an excellent first step in catering to their current demands.
A visual CPQ empowers your buyer to configure, price, and quote their own products without any input from sales. They can view a 3D rendering of their configuration in real time, which means they can educate themselves about your offering and place an order independently with confidence.
2. Need for Efficiency
Manufacturers are desperate to increase efficiency in response to spiraling costs. Modern CPQ software solutions rely on automation to streamline the engineer-to-order process, creating efficiencies at every stage. Instead of assigning hard-to-find employees repetitive tasks, you can allow them to work on strategic aspects and let CPQ take care of the rest.
For example, CPQs with a visual configurator can automatically relay designs from the customer to the engineering team. Thanks to product rules constraining designs, there’s no room for error. The CPQ solution only allows customers to choose configurations after checking their viability, freeing up engineers and sales reps from this responsibility.
Moreover, advanced CPQ software automates a significant portion of sales engineers’ responsibilities. It generates CNC cut sheets, CAD drawings, and BOMs for the shop floor, sending the information to the relevant departments. Engineers can thus divert their attention away from menial tasks and towards innovation.
3. Demand for Custom Products
B2B buyers want to be able to customize products to suit their needs. Having too few options is limiting, while having too many is overwhelming.
A visual configurator helps B2B buyers take their time customizing configurations. They can rely on something other than a sales rep and all the information they have to cram into their over-burdened brains during a meeting. Instead, they can configure products at their own pace, at any time, and on any device.
If customers need to remember something about the configuration, they can always revisit it on your website. That’s how a visual self-serve option provides B2B buyers the flexibility and speed they expect from a modern business.
4. Shift Towards B2B Ecommerce
Gartner expects that 25% of B2B sales interactions between suppliers and buyers will occur via digital channels by 2025. The report cites a B2B buyer’s preference not to interact with a sales rep as a significant factor.
Since your customers prefer shopping online versus speaking with a sales rep, you need a robust ecommerce website that delivers a holistic experience. This means you need a CPQ for ecommerce that offers a convenient feature set to serve today’s online buyers.
Modern CPQ solutions integrate into your ecommerce platform, allowing buyers to access the visual configurator whenever needed. They enable buyers to independently select configurations, obtain a price, and generate a quote for their chosen design within minutes.
5. Rapidly Evolving Technologies
New Industry 4.0 technologies like Artificial Intelligence (AI) and Augmented Reality (AR) are revolutionizing how merchants do business, especially online.
These technologies render high-quality visuals, allowing customers to experience your product in new, innovative ways without being anywhere near it.
Unlike traditional CPQ software, advanced CPQ solutions can incorporate these technologies into your buyer’s journey. Epicor CPQ, for example, lets customers configure products using VR and see proposed configurations in situ with AR.
Why is an Advanced CPQ Better?
These are why today’s advanced CPQ solutions are better than traditional alternatives.
Immersive ecommerce experience: With a visual product configurator, buyers can closely inspect your products in 3D (with potential for VR and AR). The rich, detailed visual experience is highly immersive and compelling, which helps boost the conversion rate.
No-code rules engine: CPQ software relies on product and pricing rules to automate the configuration and quoting process. The best CPQ software solutions have a built-in no-code rules engine, which lets you create advanced rules and logic without any programming experience. You can maintain everything in-house, reducing costs and complexity.
Shorter sales cycles: CPQ allows customers to quickly select configurations and acquire a price. Moreover, it enables sales and engineering teams to spend time on strategic aspects of their role instead of mundane tasks. The result? More sales and faster deliveries translate to shorter sales cycles.
Downstream automation: CPQ software solutions with a visual configurator can automatically generate documentation downstream once a customer selects a configuration. Your engineering team no longer has to manually create CAD drawings for every design.
Final Thoughts: Get a CPQ for Ecommerce to Future-Proof Your Business
CPQs that lack a visual experience are on their way out. But CPQ software solutions are still alive!
CPQs with a visual configurator can fast-track your business’s growth by boosting profitability and improving customer satisfaction and retention. They help you stay ahead of the competition and prepare your business for the tech-driven future.
When selecting a CPQ, make sure you choose a tool that’s easy to implement and offers the proper feature set. While price is always important, don’t let it be the sole factor when choosing a tool.
CPQ ROI comes from the potential to automate sales, engineering, and shop floor processes. Cheaper, no-frills solutions focus exclusively on sales and won’t integrate with the transformative Industry 4.0 technologies revolutionizing industrial processes.
