What Is Visual CPQ?
Imagine you’re in healthcare sales. You have a client who needs a complex, customized imaging machine setup for their hospital. Traditionally, this could involve lengthy discussions, multiple iterations with your design team, and a convoluted process of referencing compatibility specifications and pricing sheets.
But not with a visual CPQ. With CPQ software, this obsolescent process becomes seamless and efficient.
As you discuss various options and criteria with your client, you can now instantly configure the machine’s setup in real time. Not only can you keep up with the clients list of requirements, but the CPQ visually changes with each new component, ensuring compatibility among parts, and even suggesting additional attachments, tools, monitors and other cross-sell items that fit the needs of similar configurations.
Once the design is complete, the software automatically calculates the cost based on the various inputs and the configurations chosen, eliminating the risk of any human error.
As a final step, you generate a formal bill of materials (BOM) that you can present to your client, all in a matter of minutes.
In this way, the CPQ software turns what was once a labor-intensive, error-prone process into a streamlined, accurate, and highly efficient sales process. You not only deliver more value to your clients, allowing them to visually see their scope come to life, but you help them achieve quicker turnarounds, for the products they need.
Seems too good to be true? Think again. From manufacturing and healthcare to telecom and electronics, businesses are already experiencing transformative results by implementing Visual CPQ software.
Here’s how they’re leveraging it:
- Sell complex products or solutions that have multiple components or options or variable pricing.
- Simplify the sales process by visually guiding customers through complex configurations.
- Reduce errors. When customers or salespeople can use visual product configurators, there’s a lower chance of misunderstandings, errors, and returns.
If you’re curious to delve deeper into how Visual CPQs operate, what it takes to implement one, or which tools are available to help you create your own tailored solution, continue reading. Your own business’ transformation awaits.
Businesses should always be focusing on driving operational efficiency whilst improving the customer experience and journey. Zoovu does this and more. It’s a no-brainer decision.– Rajiv Nema, Senior Director, Partner Engagement and Marketing, SAP Store
Who Uses CPQ Software and What is an Example of a CPQ?
Visual CPQ software is used by businesses and organizations that have a need to streamline and optimize their sales processes. This is mostly common in B2B ecommerce.
B2B e-commerce often sells specialized items that aren’t one-size-fits-all. Instead of always needing a product expert to help with sales because of this complexity, Visual CPQ software lets companies show their products in a way that lets sales people or buyers easily pick and customize what they want. For example, think of a company selling customizable machinery; with this software, a buyer could pick the machine parts they need and immediately get a price, all without waiting for an expert’s help. This makes the process both, faster and more accurate for B2B sales.
However, any organization that offers a product or service with multiple variables and pricing options can benefit from CPQ software since it helps in reducing errors, speeding up the sales cycle, and ensuring that customers get accurate, timely, and consistent quotes.
Industries and sectors that benefit from CPQ
In our experience, here are the industries and sectors that benefit the most from using this software.
- B2B sales teams. The primary users are often sales representatives, account executives, channel sales reps, and sales managers. They use CPQ software to quickly generate accurate quotes for customers, especially when the product or service has many customizable features or options.
- B2B manufacturing companies. Businesses that produce customizable or configurable products, such as machinery, electronics, or vehicles, use CPQ to ensure that customer specifications are met accurately.
- Complex ecommerce businesses. Online retailers that offer customizable products, like furniture or jewelry, might integrate CPQ software into their websites to allow customers to customize products and see real-time pricing.
- Distributors and resellers. Businesses that distribute or resell products from multiple manufacturers may use CPQ software to manage the different pricing structures and product configurations from their suppliers.
- Telecommunications Companies. Telecom companies often have complex pricing structures with different plans, bundles, and add-ons. CPQ helps in configuring these offerings and generating accurate quotes.
Real-world examples of Visual CPQ
As we alluded to above, B2B ecommerce and manufacturing companies tend to see the most benefit with our Visual CPQ software, like:
- Discover how Dräger, a top company in medical and safety technology, offers a visual configurator for buyers to uniquely customize firefighter helmets. This tool displays all configuration options while guaranteeing compliance and availability. By integrating the visual configurator with CPQ, Dräger streamlines investment choices, automates order processes, and decreases manual tasks, leading to fewer purchasing mistakes.
- Or, see how Microsoft increased sales and eliminated “choice paralysis” with a configurator syndicated to over one hundred retailers across the globe.
- And GE HealthCare offers a visual product discovery tool for medical device buyers to customize their Vivid T8 Ultrasound machine according to their customers’ specific needs. This solution reduces the time spent on manual searches, evaluations, and configurations by 80%.
Looking for more examples of visual CPQ functionality?
Check out CPQ examples from market leaders such as Bosch, 3M, and KitchenAid.
Benefits of Interactive Visual CPQ
Visual CPQ software offers a myriad of benefits for both sales teams and customers.
By catering to the visual and interactive preferences of modern customers, CPQs ensure that they feel confident, satisfied, and valued.
- Improved understanding. One of the primary advantages of Visual CPQ is that it offers a tangible representation of products or services. This means customers can easily grasp the features, configurations, and pricing structures of what they’re considering without having to read through long descriptions or browse through complex product spec guides. This clarity leads to a more informed buying process and reduced churn.
- Personalization. Customers get to interact with product visualizations that change in real-time based on their selections. This interactivity not only makes the buying process more engaging but also gives customers a “sense of ownership” since they can see precisely how their choices come to life. In fact, 72% of customers now say they expect the businesses they buy from to recognize them as individuals and know their interests.
- Increased confidence. Making a purchase, especially an expensive or complex one, can be daunting. There’s always the fear of “What if I don’t like the final product?” or “Did I make the right choices?” With a Visual CPQ, these anxieties are largely alleviated. Being able to see a visual representation eliminates the guesswork and boosts their confidence in the buying decision.
- Streamlined decision-making. Customers can navigate through different product options visually, which makes the decision-making process smoother and faster. They can quickly compare different configurations, see the impact of their choices on pricing, and arrive at a decision they’re happy with.
- Satisfaction. It is an immersive and interactive shopping experience. This means customers feel more in control and better informed, leading to higher levels of satisfaction and an increased likelihood of future purchases.
Visual CPQ isn’t just beneficial for customers. It’s a strategic asset for sales teams that enhances customer interaction, optimizes the sales process, provides valuable insights, and ultimately drives revenue growth.
- Higher conversion rates. When customers can see and manipulate their product configurations in real-time, they’re more likely to stay engaged. This prolonged engagement increases their investment in the product and, in turn, boosts the likelihood that they’ll finalize the purchase. For sales teams, this means higher conversion rates.
- Up-selling and cross-selling. As customers interact with the visual configurator, they are exposed to various features, accessories, or complementary products. Sales teams can leverage this by strategically presenting higher-value options or additional products.
- Reduced sales times. A significant portion of the traditional sales process is spent explaining product options, making revisions to configurations, and negotiating terms. With customers having a clear visual understanding from the get-go, many of these steps are expedited. This shortens the sales cycle, so sales reps can close deals faster.
- Accuracy. Mistakes in quotes or configurations can be costly in terms of both time and money. It also leads to more dissatisfied customers and product returns. Visual CPQs minimize human error by automating the configuration and quoting process. This ensures that quotes are accurate the first time around.
- Data-Driven Insights. Every interaction within the Visual CPQ tool captures valuable data. This can include which configurations are most popular, how long customers spend on certain choices, and which add-ons are frequently selected. This data is a goldmine for your sales and marketing team.
- Cost Efficiency. Manual processes not only introduce the potential for error but are also time-consuming. For instance, by automating the quoting process, sales teams reduce administrative overhead.
Sales Scenario: Upselling Features Using a Visual Car Configurator
Imagine John, a salesperson at a luxury car dealership, is engaging with Emily, a customer interested in purchasing a sedan. Emily has a general idea of what she wants but isn’t familiar with all the options available. John turns to his dealership’s Visual Car Configurator, powered by a state-of-the-art CPQ system, to guide Emily through her purchasing journey.
Basic Selection: John starts by showing Emily the basic model of the sedan on the Visual Configurator. They discuss standard features, such as safety systems and fuel efficiency. Emily is pleased with the baseline features but is looking for something more personalized.
Interactive Customization: Using the configurator, John easily switches between different colors, wheel designs, and interior options. The visual display updates in real-time, allowing Emily to see exactly how her choices impact the car’s appearance.
Upsell Opportunity 1: John sees that Emily is interested in the car’s aesthetic. He takes this opportunity to introduce the Premium Design Package, which includes upgraded leather seats, a panoramic sunroof, and specialized rims. The configurator visually demonstrates these features, and Emily is immediately attracted to the upgrade.
Upsell Opportunity 2: Knowing that Emily has a long commute, John introduces the Advanced Driver Assistance package. The configurator showcases the lane-keeping assist, adaptive cruise control, and parking sensors in a visual, easy-to-understand manner. Emily sees the value and opts for this package as well.
Price Summary and Finalization: The configurator automatically adjusts the price based on Emily’s selections, providing transparent pricing information. John reviews the final configuration and price with Emily, who is satisfied and proceeds to finalize her customized luxury sedan.
Closing the Deal: With a comprehensive understanding of what she’s purchasing, Emily is confident in her decision. John generates an instant quote via the configurator and closes the deal effortlessly.
In this scenario, the Visual Car Configurator enabled John to upsell effectively, personalizing Emily’s buying experience while maximizing the deal’s value for the dealership.
How visual CPQs work
Visual CPQs simplify the sales process by offering an interactive, customer-centric, and data-driven approach to product configuration, pricing, and quoting. Here’s how it works.
Step 1: Product Selection
Upon going on a merchant’s website, buyers are greeted with a digital catalog featuring 3D product visualizations.
For instance, let’s say you sell customizable phone booths for corporate offices. So, when the office manager at a company looking for a customizable phone booth goes on your website, they’re met with an immersive experience that allows them to explore various sizes, styles, and designs.
Step 2: Guided Configuration
Going back to our phone booth example, once a model captures their interest, AI-driven prompts usher them through the customization process. This buying journey encompasses choices like soundproofing levels, booth colors, door mechanisms, and even integrated tech features. The end result is helping to visualize an end product that perfectly aligns with their vision.
Step 3: Dynamic Pricing
Then, your visual CPQ calculates real-time pricing based on customizations and discounts.
As they make adjustments, the system continually recalculates the cost. This provides real-time pricing transparency and avoids any unnecessary surprises.
Step 4: Quote Generation
With the phone booth tailored to the buyer’s preferences, the platform instantly generates a comprehensive quote, which details all chosen specifications alongside the final price.
Step 5: Needs-Based Up-selling & Cross-Selling
Then, your system automatically suggests complementary products or features, like higher-end phone booth design finishes, a ventilation system, or office chairs. This increases the average order value for your company.
Step 6: Review and Checkout
Your buyer can then review their final phone booth selections and the associated costs. Then, they are brought through a streamlined checkout process.
Step 7: Order Fulfillment
Then, the order is sent to fulfillment, and directly integrated with your ERP and CRM. Given that your sales process is fully synced with your inventory and customer support processes, it guarantees that your buyer’s vision is fully realized.
Step 8: Analyzing Buyer Behavior
Finally, the system analyzes buyer behavior for future sales strategy development. So, you can gain invaluable insights related to potential trends, customizations, and buyer behavior and you can stay on top of market demands.
Configuration Studio for Manufacturing
Sell complex products while delivering a fast, digital buying experience. Save time. Create quotes faster.
Requirements for Building a Visual CPQ
Building a Visual CPQ is all about data management. Here are the things that you need to have in place to provide an accurate, interactive experience for customers.
At its core, your Visual Configurator relies on accurate and comprehensive product data. Think of it as the fuel that powers the engine; without it, the system is incomplete. Often, businesses have product data scattered across different platforms and stored in various formats. The first critical step is to consolidate this data and integrate it into the Visual Configurator system.
Now, it is time to clean the data. Inconsistencies or errors in product data can result in incorrect configurations or misquoted prices. By leveraging algorithms, we can automatically detect and remove these discrepancies.
Once your data is cleansed, the next critical step is structuring it for optimal readability. Proper data structuring allows your Visual CPQ to instantly locate required data, ensuring quicker and more accurate outcomes.
|Galaxy S21||Smartphone||800 dollars|
|Apple 12||Phone||700 USD|
Going beyond basic product data, Data Enrichment involves adding supplemental attributes or metadata. This enhances your Visual Configurator’s ability to provide detailed, contextually relevant product recommendations, ensuring a more personalized and effective user experience.
This is where all of your data preparation starts to come together. Data integration is the bridge between your raw data and the interactive visual experience customers will engage with.
Successful data integration ensures that when a customer selects a certain color or feature, the visual representation they see is accurate.
Since products get updated, prices change, and new features are introduced, you need to make sure your Visual CPQ remains relevant and accurate. That’s where automated updates come in. This ensures your data is dynamically updated in real-time to reflect changes in inventory, pricing, or product features.
Power Your Digital Experiences with Clean Data
Zoovu doesn’t just create industry-leading configurators; we also specialize in solving complex data issues.
Future Proofing Sales with Zoovus CPQ Configurator
Visual CPQs, when infused with the right components, can serve as a robust tool to future-proof sales.
AI and Machine Learning
Visual CPQs can tap into AI and machine learning to predict trends, dynamically adjust pricing based on market conditions, and provide personalized product recommendations to customers. This level of customer intelligence ensures you can deliver tailored experiences and maximize sales opportunities in ways traditional methods can’t match.
As the line between B2B and B2C continues to blur, a laser-like focus on providing an engaging and personalized buying journey is the most important thing. In fact, 65% of American shoppers view customer experience to be more influential than advertising. Visual CPQs — especially those with 3D configurations or augmented reality — help you make it easier to exceed buyers’ expectations.
As product lines expand and your customer base diversifies, a CPQ tool’s ability to scale becomes crucial. Modern CPQs are designed to handle increased product complexity and larger customer numbers as your company grows. All without compromising performance.
From quote generation to contract signing, automating routine tasks within the sales process speeds up the sales process and reduces human error. This means your sales team can be more efficient and productive.
CPQ tools can offer localization options so that your quotes are accurate and culturally relevant. This capability ensures that businesses can cater to a diverse global audience without missing a beat.
Customers interact with businesses through multiple channels – be it web, mobile, or in-person. A modern CPQ tool facilitates a consistent and unified experience across all these channels. This means a customer will get the same level of service and information regardless of the medium.
It is not just about having the data. It is all about how you use it. Modern CPQ tools offer insights into customer preferences, choices, and behaviors. This real-time analysis ensures that your sales strategies remain agile.
Your CPQ tool shouldn’t live in a silo. It needs to sync and work well with all of the other software in your business, like CRMs and ERPs. These integrations ensure a unified workflow, where data flows smoothly and business processes are streamlined.
With the B2B sales landscape constantly evolving, you need to remain agile, customer-centric, and ahead of the curve. Visual CPQs, like Zoovu, are uniquely suited to help you provide a cutting-edge, self-service solution for your customers.
However, self-service solutions are only possible with clean, structured and enriched data
Zoovu does both — clean data, and builds industry leading experiences to drive transformational growth for ecommerce.
Ready to try it out for yourself? Schedule a demo here.