Avoid A Storage Market Catastrophe

By Jay McCall, Business Solutions magazine.

By honing its security, storage, and networking expertise, this software reseller turned around its struggling business and started growing 25% year-over-year.

Todd O’Bert is no stranger to facing terrible economic conditions. He started Productive Corp.; a security, storage, and network infrastructure software reseller business; in 2001, less than a year after the dot-com bubble burst. Right up until the day he opened his doors, he had many naysayers exhorting him to make a different career move. But, O’Bert and Productive prevailed.

Seven years after his company’s inception, however, the CEO of the then 15-employee reseller recalls facing a much bigger challenge. “Because of economic uncertainty, customers were holding off their orders, and we were doing 90% of our business in the last two days of the month,” he recalls. This trend made it nearly impossible for O’Bert to measure demand, and he became increasingly fearful his business was starting to tank. It was gut check time for O’Bert. At a time when many businesses in similar situations were looking for ways to cut costs everywhere possible, O’Bert made the gutsy decision to make a significant investment in his business to get to the root of its problems. The choices O’Bert and his team made in early 2008 not only kept the company afloat, but led to three consecutive years of 25% to 30% revenue growth. Today, Productive is a 25-employee operation and once again O’Bert is forecasting up to 30% revenue growth for 2012. O’Bert shares the key changes that led to his company’s turnaround.

Assess Your Security, Storage, Networking Business Market
Recalling the nail-biting experience of hoping his company would bring in enough revenue in two days to keep the doors open, O’Bert realized he needed to find out a couple of things very quickly. O’Bert needed to quickly find out what kind of changes he needed to make to his business to increase revenue and even out cash flow. Because Productive’s continued existence hinged on quickly getting these answers and making changes, O’Bert hired an outside consulting firm to help with the assessment. “You can do your own email surveys very cheaply, but a good outside firm with MBA-level talent can help you gather a lot more meaningful data,” he says. The firm, which O’Bert preferred not to name, was similar to an Accenture or PwC (PricewaterhouseCoopers) and cost the reseller about $50,000. Over a four-month period, the team of marketing strategy consultants worked with O’Bert, his sales managers, and one of his marketing employees to help Productive gather customer and market data. “At the time we had about 3,500 customers, and the consultants helped us capture 30 data points [e.g. geography, revenue] on each one via a combination of mail and email surveys, phone interviews, and personal visits,” he says. Through this process the reseller identified 20 customers that were willing to share the unfiltered truth about their business needs and Productive’s shortcomings. “One of the biggest revelations was how low of an expectation customers have of salespeople at reseller companies,” says O’Bert. “They deal with so many reseller sales reps who are incapable of engaging in any kind of technical discussion with their engineers or IT guys, they’re left having to reach out to vendors for help.”

One other key revelation was the difference between how Productive perceived itself and how customers perceived it. “We’ve always seen ourselves as experts in selling security, storage, and network infrastructure software,” says O’Bert. “Our website and customer feedback told a different story.” Some customers thought Productive and the vendors it represented were one and the same company. Others thought that Productive was a boutique consultant that didn’t specialize in any specific IT solutions.

Align Your Internal, External Networking Expertise Messages
Even though Productive had three techs on staff who specialized in endpoint security, backup, and recovery solutions, these were not the primary people interfacing with customers. Furthermore, the reseller’s website offered no more value to visitors than they could get from a vendor’s site. Once again, O’Bert decided to make another five-figure investment — this time to completely overhaul his company’s website and to create educational resources that would benefit his sales reps and customers. With guidance from its core customers, the reseller developed a wide array of assets, which it segments into five categories:

1. Learning Center — includes six on-demand videos designed to help deploy, install, and optimize the solutions Productive resells. One example is a 7-minute video tutorial titled “CA ARCserve Backup r15 Recovery Basics.” The presentation includes a step-by-step visual that covers an overview of the ARCserve Backup process, how to configure your first backup, and how to recover data from a deleted file. At any time during the presentation, the viewer can choose a number of related topics (e.g. deduplication, enable staging, device configuration) that provide the viewer with more specific information and then allow them to return to the original presentation or jump ahead to specific sections within the presentation. At the end of the presentation, the viewer is taken to a landing page where they have the option to receive a custom quote, custom demo, or 30-day trial, or they can provide feedback or view additional related videos.
2. Product Guides (Called P-Guides), Articles, And Reviews — this section includes more than 30 assets ranging from product comparison videos to PDFs that it calls “2-Minute Tech,” on topics such as “Protecting Virtual Sessions: What You Need To Know.” At the top of the section there’s an intro where Productive lets its audience know that it “provides relevant subject matter with unique third-party insight.”
3. Recorded Webinars And Product Videos — includes recordings of past Web events broken into chapters as well as product tips and tricks. You can click on the “ARCserve Backup r16 Overview,” for example, to see how it compares with a similarly titled asset in the Learning Center. While the former uses a PowerPoint-like presentation format and explains concepts such as how a backup works in a high-level step-by-step process, this latter section uses an embedded video to present a more detailed explanation of how to configure your product to perform a synthetic full backup. (See sidebar for more information about ARCserve Backup.)
4. Product Information — this section primarily includes product spec sheets, sorted alphabetically by vendor. This is the only section that does not include original content from Productive.
5. Midmarket Trends And Relevant Topics — designed to keep IT professionals updated on advances in networking- related technologies. This section features multiple video presentations (about 6 to 7 minutes each) from O’Bert as well as Pete Greco, Productive’s VP of sales and technology.

What are the benefits of making this kind of website investment, especially in light of the fact that 90% of the content on the site is ungated (i.e. you don’t need to provide your name and contact information to receive it)? O’Bert believes the benefits are twofold. First, he has an organized way for his sales reps to become more familiar with the solutions they’re selling. Likewise, the site serves as a viable tool to show prospects Productive has a lot of knowledge about the solutions it sells. “It especially helps when we can compare two products and talk about areas where one is superior to another and show there’s no one-size-fits-all product out there,” says O’Bert.

Since it’s been monitoring its salespeople’s product knowledge more closely, the reseller has discovered that it typically takes a new salesperson six months before they’re able to go out on their own and have an effective discussion with a client. O’Bert says sales reps must demonstrate they can build a storage or security system from scratch and add it to a network before going out and selling a solution on their own, and they need to show their manager they know how to use the software they’re selling.

Another confirmation that Productive made the right investment choices three years ago is the significant increase in Web traffic. “We used to have 100 unique visitors per month back in 2008. Nowadays, we’re averaging 6,000 per month, and we’ve increased our overall number of customers by 500,” he says.