Successfully sell your IoT prototype with these three steps

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Note: This is a blog post and I am not the original author

As any engineer working in a big company knows, building a great prototype is just the beginning of the long journey to a finished product. A good technical solution is most successful when it’s paired with a solid business case. Here are three techniques I’ve seen work, and even used myself, to sell a technical prototype to business leaders at your company.

At Particle, I’m the Director of Business Development and selling is my life. I’ve spoken with thousands of customers in the prototyping phase, helping them get from a spot not that different than you to the next stage in their product journey.

Step one: selling isn’t easy without the business value

While selling an idea to the business team isn’t always fun, in the long run, it’s a valuable skill to augment your technical chops. The business stakeholders at your company may not have a technical background, which can make selling your idea based solely on technical merit a real challenge. This can be a tough realization to confront, especially when you’ve spent days building a solid proof of concept and your prototype doesn’t generate as much excitement as you’d have hoped.

The first step in getting buy-in for your prototype is to realize that having a technical prototype simply isn’t enough to sell your project. You also need to build a solid business case to go along with your technical demo.

Step two: understand the problem you want to solve

To begin building a business case, you have to understand the problem you want to solve. Not just technically but also the overall impact it will have to the company.

For the sake of investigation, let’s take a common IoT use-case and walk through how I’d sell it. Today that will be HVAC systems.

First, what’s the market sizing?
Central air conditioning is a modern luxury that’s become a must have for most businesses and many private residences. Here in the US, the Department of Energy estimates that 3/4 of American homes have A/C, which account for a whopping 6% of all the electricity produced in the United States.

Next, what’s the problem?
As anyone who has owned one knows, A/C units have multiple failure points. From fan and compressor failures to refrigerant leaks and sensors on the fritz, there’s a lot that can go wrong with air conditioners. And this is all before you introduce the ultimate variable: how people use the device.

Typically, when an A/C unit breaks, the customer calls the manufacturer or installer and requests a service technician to diagnose the problem on site. The majority of the time, the service tech does not have the correct part with them and doesn’t have much contextual information.

And finally, what’s the problem’s impact?
Lack of familiarity, incomplete information, and a service cycle that only begins when units are not working, is a recipe for high service costs and many expensive service calls to fix a broken unit. This is a recipe for an overheated, grumpy customer.

Step Three: Identify the opportunity from a business perspective

At first, you might think that it’s best to present the technical problem — such as getting these A/C units connected will help our field technicians to run remote diagnostics on the device — and your solution as the reason it should be adopted by the business. And that’s true to some extent, but what ultimately sells this solution internally is wrapping it into a cost saving opportunity for the company.

Imagine pitching the exact same prototype — a connected A/C unit that provides remote diagnostic information — but giving it a business case. Rather than lead with the technology, lead with the value the solution creates for the company.

The connected A/C prototype lowers costs because it reduces the number of service calls necessary to solve a problem, and increase the likelihood that a single service call will be enough to solve a typical unit malfunction.

Giving service technicians access to device statistics such as fan speed, tank pressure, refrigerant levels, and sensor health, is a winning way to reduce service costs because it enables them to be more efficient at their jobs, and that saves money.

So you’ve identified key elements that get business owners and budget holders excited:

Reduced service calls, increased efficiency, and reduced hours for service technicians results in $[enter your estimate here] of savings in overall customer service costs

That business case is implemented by your technical solution, gathering the right data at the right time, and making it accessible with remote diagnostics.

Now that you have a playbook for how to sell your prototype, be sure to review these before your next TKTK pitch meeting. To learn more about how we can help build your business case with you, reach out to me directly here. I look forward to learning about what you’re building!

@Colleen, I’d like to also add CAPEX and OPEX to the discussion.
For many companies, they have much more flexibility in their operating expenditure budget (OPEX) than their capital expenditure budget (CAPEX).
Thankfully, this aligns well with the business model of Particle/IoT as a Service, and recurring payments.

The “Budget” is the largest hurdle to overcome.
OPEX usually makes that easier for large companies, and moves us into recurring income vs a 1-time hardware sale.