What benefits are there for using a configurator?
The benefit of using a configurator obviously depend a lot on which type of products you market. Generally, the benefits are larger if you are having problems with:
- Lots of returned products due to production errors
- It takes too long to train sales staff
- You can only market and offer a fraction of what you can actually manufacture
- Long lead times
A really good configurator (i.e. an attribute and constraint-based configurator) will solve the problem by letting the user create a configuration that, according to the constraints, creates a product where all parts are compatible. It will also exclude all combinations being incompatible with selected choices.
By disallowing the user to create false configurations, the risk of the buyer ordering an errronous configuration is minimal. Thus, the reasons for returning the products are minimized.
The task for a sales person is to sell and not, necessarily, knowing the product down to its nuts and bolts. The sales person, however, will need to make quotes that demands this knowledge. By using a configurator, which helps the sales person with this, he or she can focus the sales process on solving the key problems of the customer (the customer pains) and let the configurator handle the rest.
Upselling is another advantage of using configurators. If you have a product that can be configured in a thousand different ways, it is of course virtually impossible for the sales staff to keep track of all these combinations of the product. Companies usually solve this by having a certain amount of standard combinations and, perhaps, let their customers side track these combinations with extra options. The sales people often typically tend to market the configurations they personally believe the most in or that has sold well in the past. With a configurator you have access to all different configurations and the customer can choose any directly. The chance of hitting the pain spot of the customer increases, leading to happier customers and shorter sales cycles.
Long tail upselling through sales configurators
Long tail is a phenomenon getting more and more common every day. Simply, it is the phenomenon where the more of a product category you can offer to the market and the less the cost is to store that product, the more you will sell. All products that was earlier to hard for the customer to find or not enought profitable to market (due to storage costs) are under these circumstances profitable. Companies, such as Netflix for an example, have greater allover turnover of films that is out of the top 100 than within the top 100! On the contrary, "physical" malls like WalMart has to rely on blockbusters only since the cost of keeping every movie is a real "shelf cost".
By using configurators you can offer a much larger portion of your storage for a minimal extra cost (the different parts of the products are already in the storage!). This way you can sell more of your long tail products.