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Is there a Growth Path for a 20 Year Old Product

Case Study Project Description

HR Payroll software programs abound. After industry consolidation, most of the small companies had either been bought by the larger firms or gone out of business. This software company had one great product, service and maintenance revenue and a crack software development and technical support team. But their focus had been on research and development for years, and servicing existing clients, not sales. With a new web interface completed and a ground breaking but difficult to understand second product, was there still a future for the HR Payroll system? There were a lot of pluses and a lot of challenges. Was it time for this company to fold? Was there an opportunity to be acquired? Or could growth still be an option?

Project Problem

ERP solutions for human resources, payroll and performance are dominated by the large ERP vendors. In this business, the old adage that ‘those that choose to buy IBM don’t go wrong’ seemed to dominate the purchasing decisions. How could this stable and proven software company get into new markets without being PeopleSoft or IBM? Further, the company had pursued many unrelated markets so reference clients were dotted across the spectrum of industries and geographies. There seemed to be no natural fit into any one target market despite the superb reputation they enjoyed for service amongst their great reference clients. The CEO and the COO were concerned about focusing on only one or two markets unsure as to whether they would yield any results.

Solution

The solution to this problem was to teach them about marketing, market research and market development so that they would understand how to build their own plan. We worked together on the process of uncovering what this product did that other products couldn’t do. It can be hard to look at your own product and spot what others see as the ‘thing that solves the real problem’. By interviewing existing clients, looking at competitors, understanding challenges in various industries, we finally found three distinct claims that everyone ignored that actually had the greatest value for a certain group of prospects.

Additionally after 20 years in business, the product had some very robust functionality and it did not price out after implementation nearly as high as its brand name competitors. When this research was done, then we had to find those organizations that had these problems where the company actually had reference clients and build out a database.

When a company doesn’t have a well known brand name and there is a lot of competition which results in noise in the distribution channel, advertising is a waste of time. Public relations is the best tool. An integrated marketing strategy using PR, Web 2.0, direct email and immediate ‘taste tests’ direct experience is vital. Together we shaped a marketing message, case studies, press releases, a web 2.0 strategy, measurement, KPIs and a lead generation system that tied together to become their call to action. We then coached the senior team in how to work with and use the message, how to build capacity to manage the growth and how to constantly evolve and improve the messaging system so that it would attract motivated buyers within two different and fragmented target markets.

Result

The time-intensive research and market focused discipline combined with a dedication to web 2.0 and public relations approach rather than expensive advertising started to pay dividends. In the first year, they achieved 400% growth in their sales calls and started winning business from much larger competitors. Because of this company’s dedication to service and responsiveness over the years, their few reference clients were willing to become champions for the company. One even voted the software client the most valued vendor amongst numerous other government vendors. Most importantly, we proved that there is a future and that revenue and gross margin growth are possible, even when it looks impossible.