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Best Practices


Hand shake

Consumption vs. Acquisition: How to Drive Long Term Cloud Technology Success

  • Written by Vendor
  • September 21, 2017
When cloud technology service providers focus solely on acquiring new customers, they do little to support customers immediately after they attain them.

The outcome of any market transformation is an immediate response from companies who want to build their presence and establish a large amount of market share. In the case of cloud innovation, technology companies initiated an arms race of investment to acquire net new customers across their marketing and sales portfolios. Free trials and discounted licenses started to inundate the market, as companies battled to secure new buyers and convert current on-premise customers to cloud solutions.

When cloud technology service providers focus solely on acquiring new customers though, they do little to support customers immediately after they attain them. With sales representatives zeroed in on new customers and not mindful of overall existing customer success, a significant percentage of customers are likely to discontinue their use of cloud technology with more than half of all IT projects failing, according CIO magazine. In order to remain successful in the cloud market, it is critical for cloud technology solution providers to invest in differentiated sales and support motions to drive cloud consumption –  not just acquisition – and deepen customer relationships.

Recognize the New Buyer’s Journey 

One fundamental way cloud technology solution providers can achieve long-term success is by recognizing how the buyer’s journey has changed and gaining an understanding of buyer needs in the post-sales realm. This understanding requires a different skillset from the salesperson who initially acquired the customer; the consumption seller must have a deeper level of product and technical fluency, as well as the appropriate knowledge to drive increased use of the Cloud solution within the current workflow and priorities of the specific organization.

By either aligning projects with specific workloads and modules that are part of the cloud solution, or up-selling specific applications to sit on top of the current platform, understanding the new buyer’s journey can help drive consumption.

Identify Opportunities to Upsell and Cross-sell

Having the ability to upsell and cross-sell to customers is important in driving successful cloud technology consumption. Existing customers who already perceive value in deployed solutions are more open to hearing about additional solutions – integrated vertically or horizontally – that will have a positive impact on their businesses. Cloud sales representatives with consumption-specific territory and quota must identify the core areas of the current cloud platform solution and tailor sales efforts based on the lines of the business that they think will benefit from expanding the use of the existing cloud technology. That means they need to really understand the customers’ business and technology infrastructure. Through doing so, organizations will help their customers fully understand and leverage their cloud technology to positively impact bottom line.

As part of the upsell and cross-sell initiative, customer success teams need a level of expertise in transitioning business functions of current customers from on-premise to cloud. It’s important to have background familiarity with the cloud technology the customer previously purchased, as well as the skillset to advise and enable migration as part of the customer success process. In order to be successful, the representative leading the migration needs a deeper layer of technical and solution skills, and while the process will likely involve a hand-off from the original salesperson, there needs to be a tight integration within the team to ensure continuity and a clear direction.

Nurture Leads to Growth

By leveraging unique approaches to workload prioritization and consumption enablement, market-leading cloud companies and service providers can nurture new customers into loyal, growth customers, and reduce the need for marketing teams to “buy back” market share to replace abandoned customers. They will also save money – according to Gartner it costs five times as much to attract a new customer than to keep an existing one satisfied – and Bain and Co. found that a 5 percent increase in customer retention can increase a company’s profitability by 75 percent. The key for cloud technology companies is finding the right partner who can help approach and maximize customer success opportunities and create a buyer journey that is tailored to the customer’s specific needs. 

About the Author

Tim Killenberg, Senior Vice President, Sales + Marketing, N3, has more than 20 years of sales and marketing experience with high-growth companies. In his current N3 role, Tim manages all internal and external marketing efforts, including digital-driven marketing automation services integrated with N3’s Inside Sales services. Tim is also responsible for N3 sales efforts within the technology and software industries.

Tags: Cloud Service Providers Digital Service Providers MSPs VARs/SIs Best Practices Cloud

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