Our industry has a poor track record of launching new initiatives. Looking back on the last fifteen years, document management and managed print services never really seemed to get traction with more than 15% of a dealership’s customer base. Countless dollars were spent on training, infrastructure, and staffing. However, for most dealers these programs never really went mainstream.

Today, we sit on the threshhold of another huge initiative: Managed I.T. Services. However, the urgency for this transition is a little higher than the urgency for soluitons or managed print. In the early days of the solutions business, prints were still growing year over year. Solutions were a nice way to drive conversation, differentiate, and protect some margin. The early days of MPS were a little more urgent as page counts had flattened. But today, we face the beginning of a downward trend in pages. Therefore, we have to get the Managed I.T. Services transition right.

1. How do you make Managed I.T. Services mainstream in your dealership?
2. How do you go beyond just getting 10% of your customer base on board?
3. How do you set yourself up for success where managed services revenue is major chunk (or majority chunk) of your revenue mix?

In the early 90’s, Geoffrey Moore noticed a similar trend in technology companies. They would launch a new solution and the first few years of growth were spectacular. Then, something happened. Virtually every one of them fell off the revenue cliff into a big hole. Growth stopped. Investors and managers became disillusioned. The new initiative failed. (His research is found in the book Crossing the Chasm and in my new friend, Paul Weifel’s book, The Chasm Companion–two great reads!)

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This trend of falling in the revnue chasm after exhausing the supply of early adopters happened over and over again in the 90’s. I believe it has also happened in our industry. So what went wrong?

EARLY ADOPTERS

Moore’s research took him back to the product adoption curve. When a new product/service/solution is launched, the very first people to come on board are the early adopters. These wonderful buyers love technology. They are willing to take risks. They want the latest and greatest thing. So, when you come to them with something new, they say, “yes” to your offer. Sometimes this is simply because they trust you. But mostly, this is because they are willing to take risks.

So, what’s the issue?

The problem with early adopters is that they only make up about 15% of the population. After you sell to them, you have to move on to the middle of the bell curve: the mainstream buyer.

The problem is that most companies never made the shift to sell to the mainstream buyer. As a result, they fell in the chasm and the initiative died. This happened in the tech world in the 90’s. It’s happened over and over in the office equipment channel. To succeed, we need to get great at marketing and selling to mainstream buyers.

MAINSTREAM BUYERS

The mainstream buyer makes up about 70% of the market. There is a lot of money to be made here. However, the problem is that the things that worked to sell to the early adopter do not work for the mainstream buyer. In fact, these things terrify the mainstream buyer.

Here’s what characterizes the mainstream buyer:

• Skeptical
• Low trust technology
• Afraid of making a bad decision
• More concerned about their safety and security than revolutionizing things
• Don’t trust massive ROI’s
• Want references from their peers

To sell to a mainstream buyer you need to make them feel comfortable. They don’t really trust technology. They know they need to have it, but they are very cautious. They’ve been burned before and it hurt both their business and their reputation as a level-headed manager.

Mainstream buyers are more concerned about safety, security, and stability. They don’t want to rock the boat. They want things piloted, phased in, and fully supported.

Show a mainstream buyer a 250% ROI and you’ve destroyed trust. “Anyone promising a 250% ROI is a snake oil salesman,” they reason. Instead, they like to see more realistic returns based on conservative forecasts.

Mainstream buyers want references from their peers. They don’t want references from the early adopters. Remember, they don’t trust these fly-by-the-seat-of-their pants mavericks! Instead, they want to see references from other conservative people. Better yet, they want documented case studies.

TWO CRITICAL QUESTIONS

You need to look at your dealership and each of your through the lens of a potential client. Ask two questions:

1. Would I trust this company to manage all of my critical data?
2. Would I trust this sales rep to give me technology advice?

These are hard questions to ask. When you look at your dealership’s online presence and your sales reps’ LinkedIn profiles, do you feel confident that you have come across a team of experts? Or, do you get a nervous feeling in your stomach?

Take a look at your business with fresh eyes? What needs to change? In our next blog article we’ll discuss four ways you can set your dealership up for success in Managed I.T. Services.