Ⅰ Ⅱ Ⅲ BACKGROUND ANALYSIS ALTERNATIVE PLANS
Centra is a pioneer in software eLearning in the fast-growth market. However it faces the threat from WebEx, who sells exclusively over the phone. Now, It is debating how to modify its go-to-market strategy and how to add telesales to improve sales force productivity. Should Centra concentrate on the enterprise customer and exclude small and mid-size corporations ? OR
Should Centra ‘fish where the fish are biting’ ?
The market for Corporate eLearning and eMeeting
the market for eLearning and eMeeting 11 12 10 8 6 4 2 0
The number of Delivery Platforms Vendors
the number of Delivery platforms vendors
The one that wins the broadest installed customer base in the least time,
20 20 15 10 5 0 3
The competition among 20 vendors is very fierce. Comparison between three typical companies is as follows. revenue($'000) sales spending 25000 51000 revenue per customer($'000)
field sales, telesales and enterprise sales
enterprise sales; single-source vendors
revenue per customer
Straightforward strategy Market leader in sophisticated end Products from simple to sophisticated R&D capability Rapid growth markets Merger waves
The friction between telesales and field sales Bad financial situation Penetration rather than dissemination Limited experience in enterprise deal Success of new competitor, WebEx Compared with LMS vendors, lack the support from SIs.
Ⅲ Alternative Plans
Target customers: All types of customers Part of telesales integrated with field sales being responsible for Global 2000;other telesales responsible for non-Global 2000 customers.
Target customers: Global 2000 Telesales responsible for EMeeting and Conference; Field sales responsible for Symposium.
Target customers: Global 2000 Telesales commence Initial contact and try to sell big-ticket products. They would deliver the transaction to field sales when necessary.
Ⅳ Comment on Plan A
Advantages: • Economical efficiency; • Clear classification of responsibilities; • Expansion of telesales to Global 2000 brings better penetration and dissemination. million $ 30 25 20 15 10 5 0 1996
Disadvantages: • Decentralization of target market; • Reduced chance to become a leader in a particular market segment.
"Shot gun" Sales force are used like
Sales SG&A expense
a shot gun to cover over a large spectrum of customers. Sales may be satisfactory but leadership of any market segment may be lost thereof.
Reducing this cost item is vital for financial improvement of the company. For every million dollar of sales, telesales saves $100,000 compared with field sales. So telesales is a possible solution to this problem.
Comment on Plan B
Advantages: • Concentration on one single market segment; • Economic efficiency; • Clear classification of responsibilities. Disadvantages: • Potential conflicts of interest between telesales and field sales personnel; • Possible loss of business opportunities.
Revenue from products
17% 66% 15%
Symposium Conference EMeeting Other services
Although faced with some loss of small and mid-sized midcustomers, all the sales force can cooperate to help the company achieve the leadership in the mainstream market segment.
Telesales people may try to sell EMeeting to customers instead of more profitable Symposium or Conference in the best interest of themselves. It is also a hidden trouble of...