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Cooper Moss

Mr. Rudebusch

English Comp IV

7 January 2019

Is CPQ the next Marketing Breakthrough?

The marketing industry is always changing, making it hard to keep up with the industry’s

standards. In fact, 76% of people think marketing has changed more in the past two years than it

did over the previous fifty, according to a survey done by Adobe Blogs. This is a good indicator

that the industry is always changing and that there needs to be another breakthrough. One current

issue going on within the marketing industry is how long it can take for sales reps to complete a

sale. Sales reps have to do a lot of reading and memorizing in order to sell products. They have

to go through countless amounts of information. However, there is something new on the rise

within the marketing industry known as CPQ. With CPQ, sales reps and customer will be able to

have all the updated information they need on a product or components instantly. Because of

CPQ, sales reps can get back to customers almost instantly, resulting in a much faster sales

process. CPQ comes with many more benefits and is on the rise as a necessity for companies.

Companies that use CPQ will benefit more than companies that don’t.

CPQ is seeing a lot of growth and is helping marketing companies make a lot more

money. According to Gartner, a company that has implemented CPQ, they predict “20% annual

growth through 2020, estimating a $570 million market in 2015 and $157 million in sales for

cloud-based CPQ solutions.” One reason that CPQ might be seeing this growth is because it is

very simple to enable. The reduced upfront costs associated with setting up the CPQ introduces
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new participants to the market. This implies that companies are entering the CPQ market for the

first time, resulting in more growth. Another reason CPQ is growing is because of how simple

and efficient it is to use for the sales process. Given that many sales transactions involve other

parties and are complex, a tool that supports product selection, solution configuration, price

negotiation and quote presentment that can be deployed across multiple interfaces is essential for

sales reps in making deals with customers. Based off of this information, it would be smart for

companies to start using CPQ as there seems to be growing trends for companies that use it.

Companies will also see a bigger market when using CPQ. There is a lot of money to be made

with CPQ so it would seem logical for companies to implementing it in their sales processes. If a

company uses CPQ, that company can expect to see a lot of growth with more money being

made.

There are a lot of companies and sales professionals jumping on board with using some

sort of CPQ. According to a recent study from Accenture Interactive, 83% of sales professionals

are using some form of CPQ systems today. With most companies turning towards using CPQ, it

would be best for companies without it to start implementing it as soon it will be standard for

companies to have it. According to a survey by Salesforce Research, 76% of customers expect

companies their needs and expectations. It is going to be standard eventually for companies to

have CPQ as it is making the sales process much easier and efficient.

One of the many things that CPQ will do is improve quotation accuracy. According to

solutionspace.com, a marketing website that gives information about CPQ, when implementing

the CPQ-system, it will be designed to make sure that each component being selected by the

salesperson is accurate to what product they are trying to get. More often than not, elements like
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erection, installation and implementation are estimated based on rules-of-thumb, which in most

cases are not updated by experience from earlier projects. The result is that the proposed solution

might not even be possible to build and correction will cause extra cost. With CPQ you can

almost guarantee to always have precise quotation accuracy.

With CPQ you can expect to see the sales cycles shortened. According to

solutionspace.com, A CPQ-user was asked to issue a quote, clearly to be used as a price check

against the customer’s normal supplier. Because they had just implemented CPQ, they were able

to respond to the request very fast and with precise specifications already next morning. Without

CPQ the sales cycles will take longer if you are selling complex products. It takes time to

convince the prospect and you will often need to revise the quotation several times. Very often, it

takes longer to reach a ‘no-decision’ than to obtain an agreement with the customer due to

complexity of the sales project. With CPQ you can get more sales done more efficiently,

resulting in more money made for the company.

CPQ will secure higher sales hits rates. When your quotations takes less time to prepare,

are more accurate and closer to your customer’s requirements, the higher is obviously the chance

that he will order from you. The Industry Analysts report up to 40% higher hit rates. With a good

and completely integrated CPQ-system you will not only get more and larger orders, you will get

them faster, with higher accuracy and better value and create satisfied customers who most

probably will buy from you again.

Having CPQ can reduce the risk of multiple errors. Instead of having to use the original,

previous quotations with possible errors, you can automatically update the configuration models

with the newest components and prices. You can also update the system based on experience
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from completed projects and thereby share best practices across the organization in order to

minimize risk and optimize profit. When the CPQ-system helps your sales reps to select products

and configurations that can actually be built with current prices, the risk that they might offer

something that will not work and therefore will require rework is minimized.

There is plenty of statistics and evidence to show that companies using CPQ are doing

better than those that don’t. According to a study by Aberdeen, “Best in Class” companies using

CPQ saw 105% larger average deal sizes, 49% higher proposal volume, 27% shorter sales cycle,

26% more sales reps achieving quota, and 19% higher lead conversion rate. “Best in Class”

companies were measured against industry average and laggard companies. “Best in Class”

companies invest in and use technology following a disciplined approach to give their employees

what they need to do their job better. They also do it to become easier to do business with. “Best

in Class” companies are of the highest standard because they are disciplined, aggressive, and

they typically are the leaders in their industry. Companies that are using CPQ are doing better

because there is real return on investment, not returns based on absolutely best case scenarios.

Companies that have implemented CPQ will always have real value. CPQ is a must have for any

company that is serious about their top and bottom line growth and customer satisfaction.

Companies that use CPQ will do better than companies that don’t use it.

In conclusion, companies that use CPQ will do better than companies that don’t use it.

Companies with CPQ will have better growth and will have a bigger market, resulting in more

money. CPQ will offer many benefits such as improved quotation accuracy, cut down quotation

time, increased sales productivity, shortened sales cycles, reduced risk and higher sales hits rates.

It is almost to the point that having CPQ is a necessity as it will soon be standard for marketing
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companies to have. The marketing industry is always changing and improving, and with CPQ,

we might be seeing the next marketing breakthrough. If a company wants to be at the top, they

will be using CPQ.

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Work Cited

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apttus.com/blog/3-reasons-why-cpq-market-expanding-rapidly/.

Brooks, Aaron. “20 Digital Marketing Stats You Need To Know In 2019.” Venture Harbour, 3

Jan. 2019, www.ventureharbour.com/digital-marketing-statistics-charts/.

Columbus, Louis. “Configure-Price-Quote (CPQ) Market in 2019.” SelectHub, SelectHub,

selecthub.com/customer-relationship-management/state-cpq-market-2017/.

“Companies That ‘Do’ CPQ Are Doing Better than Most.” EndeavorCPQ, 25 Aug. 2016,

endeavorcpq.com/blog/configure-price-quote-cpq/companies-that-do-cpq-are-doing-bette

r-than-most.

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www.martechadvisor.com/articles/asset-management/the-case-for-embracing-cpq-as-a-m

arketing-solution/.

Marketing, FPX. “Top Five Industries Poised to Benefit from CPQ.” FPX,

www.fpx.com/blog/top-five-industries-poised-to-benefit-from-cpq.

Washington, Lou. “The Real Challenge of Selling without CPQ Software.” Business

Applications, 24 Sept. 2018,

www.cincom.com/blog/us/quotes-proposals/challenge-selling-without-cpq-software.

“​What Is CPQ ?” What Is CPQ, solutionspace.dk/cpq/what-is-cpq.aspx.