Kingston Technologies was caught between the proverbial rock and a hard place.
In the spring of 2000 as the tech market was softening, the manufacturer of computer memory and networking hardware saw sales falling. Executives felt the critical need to rejuvenate their relationships with resellers and create more user demand for the company’s networking products. “We wanted to build a reseller plan direct to the customers that would generate sales but not cut out the distributors in the supply chain,” says Jason Jacobi, director of marketing for Kingston, which is located in Fountain Valley, California.
Channelsource Direct, had the answer. The Buffalo, N.Y.-based outbound sales call center has served the technology industry since 1995. The company uses consulting expertise and focused target-marketing practices to create custom sales campaigns for technology clients.
“Kingston wanted to modify the sales chain, not reinvent it,” says Jeffrey Drilling, President of Channelsource Direct. “It’s an Asian-owned company where the executives see everyone (including resellers) as part of their family. It’s a different culture and the value they place on existing relationships is remarkably high. So we had to create end-user awareness, but not rock the boat.”
Channelsource Direct’s strategy involved building a reseller plan that would create market interest, not cut out the distributors in the supply chain. “We generated several thousand highly qualified resellers who were moving network products and providing installation type services throughout North America,” says Drilling.
In becoming more familiar with end user needs and modifying the supply chain, which in turn funneled more business to resellers, the outsourcing supplier increased client demand for Kingston’s products in a soft market. “What distributor,” asks Drilling “is going to tell a customer that he or she can’t deliver a product that customer wants?”
The result of this outbound sales campaign had the following beneficial results for Kingston:
- Developed (and in many cases redeveloped) distribution relationships with 10,000 resellers — a growth of 500 %
- Increased its market share — even in a soft market
- Created better relationships with all levels of the sales chain.
Repeat Business Keeps The Doors Open
How did Channelsource Direct turn chicken feathers into chicken salad? “We are very clear that our primary client objectives are to generate revenue and help them develop healthy long-term relationships. The best way to sell in the tech business is from a relationship perspective,” says Drilling.
Though it’s easy to articulate such a goal, the devil’s always in the details. Drilling’s firm positions itself as not only a sales option, but as a consulting partner by using its experience to leverage success as if it were the client’s in-house sales team. “We represent ourselves in the market as the client company. And we look out for their overall interests since we, like our clients, are after repeat business.”
“Some of the creative things we did included pre-qualifying hardware requirements and sampling the market to assure the products we released were best suited to our customers. A company that’s just going to dial-out, move product, then go home isn’t going to take the time to fine-tune their process to our needs unless they have a working interest in our success,” says Jacobi.
He continues, “We’re a channel advocate. In this instance we determined from the resellers (retailers) what the changing customer base wanted, outlined our value and generated demand. But we routed that demand to their distributor of choice. In essence, together we did new market research for our distributors.”
“A typical relationship finds us (as a supplier) strategizing and putting together a sales approach that is defined by the client’s culture,” says Drilling. The supplier makes adjustments to this approach as the sales process matures. Channelsource Direct also identifies the strengths and weaknesses of the client’s competitors. Both carefully define the relationship, then establish performance evaluation metrics and service level agreements (SLA).
The supplier then solicits opinions on the products from third-party industry experts and existing customers, which gives the client’s product credibility. Once that’s done, an online demo is offered so potential customers can experience the product. By that time, Channelsource Direct will have identified the ideal sales prospects and their hot buttons. The supplier is now ready to ask for the sale on behalf of the client.
So what are the tangible benefits of Channelsource Direct’s efforts?
“First , we generate revenue quickly. Speed to market is critical,” says Drilling. “Since we have cumulative experience in tech sales, we maximize client productivity and minimize our learning curve.”
Channelsource Direct has served hundreds of clients in the past six years and developed over 50 targeted sales campaigns for tech clients in the past three. “We offer a skilled sales force that drives revenue, but we plan and execute like a consultant,” adds Drilling. “It’s the best of both worlds.”
He understands the push/pull dynamics of outsourcing sales. But he also offers caution in selecting a firm to represent such efforts in the marketplace.
Drilling says buyers outsourcing their call center sales “must define their objectives.” For example, the products and services must have a defined market.
Selecting the right call center is important, too. Drilling says there are several thousand call centers in the US, each with different strengths, weaknesses and focuses. The best results happen when the skill sets of the call center match client needs.
But the key aspect is establishing agreeable performance metrics so the client can evaluate the supplier’s performance. Drilling believes they are “the most critical element” in sustaining an ongoing sales outsourcing relationship.
Finally, buyers “must have realistic expectations.”
Arriving at the Outsourcing Decision
To many firms, the idea of outsourcing any core task is a dubious prospect. The financial benefits are clear. But they weigh those advantages against a perceived loss of control over a traditional inhouse duty. Furthermore, the idea of outsourcing sales, the lifeblood of any firm, can make company officers uneasy.
Drilling understands the ambiguities of such deliberations. But he also knows the benefits far outweigh the risks.
“Anytime someone outsources sales, they must accept they are going to have to share control of their revenue generation process. Part of the problem we outsourcers collectively experience is everyone has either had a terrible experience themselves, or knows someone who has. But if a company selects the right organization, the upside is huge.”
Lessons From the Outsourcing Primer:
- The most successful outsourcing sales relationships are typically found when client and outsourcer communicate closely.
- An outsourcing sales provider offers speed to market in half the time (or less) than in-house sales campaigns and usually generates revenue faster.
- The right outsourcing sales provider can generate revenue in either product rollout or aftermarket/legacy environments in ways that can increase customer loyalty and lead to repeat business.