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Zilliant 2021 Predictions: The Future of B2B Pricing & Sales

vmblog 2021 prediction series 

Industry executives and experts share their predictions for 2021.  Read them in this 13th annual series exclusive.

2021 Predictions on the Future of B2B Pricing & Sales

By Greg Peters, Chairman, President and CEO, Zilliant

2020 has been quite a year. Never have we, in our lifetimes, seen so much disruption to our personal and professional lives. The pandemic, and all the offshoots from it, is both accelerating many trends already set in motion as well as creating a whole new set of business challenges. 

Today, just one thing is certain. For business leaders, those tasked with meeting the P&L goals of an organization, there is no place to run and no place to hide. Entering 2020, it's not like winning in the marketplace was easy. Massive shifts in customer expectations and competitive requirements were already taking place a year ago. These included things like:

  • Increasing competition in the form of new online entrants, including Amazon
  • Customer expectations for a B2C-like, frictionless online buying experience
  • Increasing cost volatility and the impact of tariffs

The Covid-19 virus has only complicated these trends even more. It has significantly impacted global supply chains, impacting inventory availability worldwide. It has caused significant shifts in product mix for some companies with some sectors seeing rapid growth and the opposite in others. Similarly, sales channels were shifted literally overnight with the rapid acceleration of ecommerce and minimal in-person interaction. 

As we look forward, I think there are a few things we know. First, we know the level of interconnectedness and interdependency of people and organizations will continue this unpredictable B2B buying environment. Second, we know customer interactions will continue to be increasingly digital - forcing people, processes, and technology to continue to adapt. Finally, we are seeing that people alone cannot scale in this world and organizations must learn and embrace AI technologies. 

Looking toward 2021 with these factors in mind and looking at how quickly software and technology has evolved in the business world to nearly reach parity with the consumer world, here are my predictions for the future of pricing and sales in 2021. 

Prediction No. 1: 50% of In-Person Sales is Gone Forever 

The impacts of the COVID-19 pandemic have heavily disrupted the classic sales channel balance between inside and outside sales teams. eCommerce is now an essential channel with companies racing to make it easier for customers to buy from them online, inside sales teams quickly adjusted to performing their jobs from home, and shops stayed open if deemed essential. The field sales reps did their best to quickly adjust their normal jobs on the fly to be available to their customers without being able to call on them in person.

According to McKinsey, "almost 90 percent of sales have moved to a videoconferencing/phone/web sales model, and while some skepticism remains, more than half believe this is equally or more effective than sales models used before COVID-19."

Certainly, the sales landscape has shifted quickly under the burden of COVID-19 disruption. Savvy company leaders are adjusting in-step, utilizing predictive sales analytics to blend inside and outside sales and better serve each customer. 

However, once the pandemic subsides, we will not be returning to the previous traditional sales mix. Bill Gates recently predicted that 50% of business travel is gone forever. Not only will sales travel follow the overall business travel prediction from Gates, but also, companies are finding avenues to give their customers the frictionless online buying experience they crave. 

That's a tall order in the highly tailored and often customer-specific nature of B2B sales. Thankfully, AI is advancing rapidly to give customers a personalized experience that is contextually relevant to their unique relationships with suppliers. As a result, a large percentage of business will be transacting digitally, and with increased efficiencies on both sides, shifting that business back to in-person sales is not likely to happen. 

Prediction: 50% of in-person sales is gone forever. Companies will utilize predictive sales analytics to enable outside sales reps to give accounts the white-glove customer experience remotely while giving customers the personalized experience they enjoy as consumers. 

Prediction No. 2: Leading Companies Make Significant Strides in Closing the Strategy-Execution Gap 

For B2B companies to compete and win, executives must have a means to tie their strategies to how sales teams engage with customers through each interaction. Yet companies lack a systematic, scalable way to do so. 

If the company strategy is to increase profitability and revenue, how should that impact prices and sales decisions across various customer types, multiple channels, agreements, regions, products, and much more? How should those actions change to meet P&L goals as costs change, demand spikes or plummets, volume growth stagnates, or new competitors sneak in?

Ideally, guidance reflecting corporate strategy would be immediately disseminated across channels, and tailored to all the various, and sometimes competing, market realities that can be present at once across a business.

The example above is a notion that business executives know well - closing the gap between corporate strategies and sales actions. It is an oft-cited catchphrase, yet companies have yet to achieve a means to translate strategy into action. Why? Because despite significant investments in mobile, eCommerce and sales intelligence technology - a market estimated to reach $5 billion1 by 2027 - companies still lack a centralized, connected solution.

However, software, data science and AI have made significant, pragmatic advances to address challenges in the complex and dynamic B2B business landscape. The result being that it is possible to translate growth and profit strategies into sales action. It just requires an inquisitive mind to discover the solution and reimagine what's possible. 

Prediction: Heading into 2021, given the urgency for business leaders to deliver stellar business performance despite significant challenges, I predict that leading companies will make significant strides in closing the strategy-execution gap. We'll see companies increasingly adopt predictive sales analytics and campaign management applications to generate sales growth intelligence faster and bridge discrete strategies and systems to drive specific actions across the entire customer lifecycle.

Prediction No. 3: Price Optimization & Management Crosses the Chasm

One of the most oft-quoted facts about pricing - that a 1 percent improvement in price, assuming no loss of volume, increases operating profit by 11.1 percent - is nearly 30 years old (Harvard Business Review, October 1992). Yet, the software category of B2B price optimization and management which emerged about one decade later, has not been widely adopted despite its measurable financial benefits. 

It's interesting to consider why. Over the course of 20 years in the pricing space, I've made some broad observations. The first reason is that everyone (and no one) owns the pricing function within a company. The second reason is simple: Pricing is complicated. The third reason is a perceived data barrier. A common misconception among company leaders is that they do not have enough usable data. Despite these challenges, most company leaders intuitively know that there's room for improvement with respect to pricing. We agree, of course, that pricing is extremely important to drive profitability, which the data supports. 

However, both pricing optimization and price management solutions have made significant advances in recent years. Now, companies can empower pricing teams to simplify onerous price management and administration tasks while delivering market-aligned dynamic pricing to maximize margin or revenue. 

Interestingly, the category is growing among analysts in the space as well. In the 2018 IDC MarketScape for Price Optimization & Management, the authors predict that "the use of price optimization applications will grow." They cite a few reasons, some of the most interesting being because, "value is demonstrable and payback is short, competitors are going to use them (price optimization and management solutions), the amount of rich customer data is increasing, integration with upstream/downstream systems is more standardized, and the use of machine learning will create better models faster." Certainly, the category itself is poised to take off, and we've seen a significant spike in demand. There's also another market headwind contributing to my prediction: CPQ. 

Configure, Price, Quote (CPQ) software helps sales reps streamline the tasks related to creating quotes for their customers. According to Gartner2, "In 2019, the CPQ application market grew by 15.5%, to an estimated $1.42 billion." As the CPQ market continues its rapid ascent, more companies are recognizing the critical nature of the "P" in CPQ. 

To get the full value of CPQ, it's critical to provide high-quality prices within the CPQ solution, which is no small task given the complexity of the price setting and management process. When pricing guidance is market-aligned and delivered within CPQ, companies can improve the speed and effectiveness of pricing decisions within the quoting process. CPQ solutions do not typically include advanced pricing science or even management solutions, and as such, an increasing number of customers are seeking a more sophisticated pricing solution that truly meets their needs. 

Prediction: In 2021, I predict that the software category of price optimization and management will gain mainstream awareness and widespread adoption in the B2B landscape. By doing so, this high-value solution will become widely adopted by pragmatists in addition to visionaries.

Prediction No. 4: B2B Matches B2C eCommerce Customer Experience 

For those following B2B and the complete and utter havoc that Amazon and other born-in-the-cloud competitors wreaked on the market, pointing out the urgency of eCommerce is like telling a stock trader to "buy low and sell high." 

B2B company leaders understand they are behind the curve when it comes to a world-class online experience for their customers. The difficult part is reconciling consumer strategies like real-time product and pricing promotions to the B2B market, which is highly customized, negotiated and tailored by its very nature. 

The pandemic has accelerated trends and challenges that were already in motion, while creating an entirely new set of challenges to contend with. Massive shifts in customer expectations and competitive requirements were already taking place a year ago. 2020 forced an abrupt increase in the amount digital business being transacted, forcing companies to act quickly. 

The good news is that, despite these challenges, B2B software has caught up with commercial capabilities and can mimic the B2C experience. Advances in pragmatic AI have made a host of commercial solutions possible, including: 

  • Deliver highly relevant, complementary product recommendations based on the items in the customer's cart.
  • Ensure the prices customers see online strike the right balance between meeting their expectations and the seller's business objectives. 
  • Differentiate pricing for existing customers and new visitors by product category or SKU.
  • Set eCommerce-specific discounts that can be personalized (or targeted) to customer segments and product groups. 
  • Analyze pageviews, conversions, cart abandonment data and inventory availability to set multiple discounting strategies online. 
  • Identify cross-sell and customer retention insights across your entire customer base to guide customers to the products they aren't currently buying but should be buying as well as the items to re-order.
  • Automate pricing negotiations between customers and online or self-service portals, reducing quote turnaround time and reserving sales intervention only when pricing requests are outside of pre-established margin bounds. 

Truly, capabilities for companies to deliver the frictionless, intuitive customer experience online have reached parity with their B2C counterparts from a commercial perspective. As the use cases and ease of implementation grow, the standard B2B eCommerce experience will also reach a maturation. 

Prediction: In 2021, I predict that the B2B eCommerce experience will mirror that of B2C. Meaning, companies will be able to deliver the real-time pricing, product and sales experience their customers expect, with all the nuance of the dynamic, highly-negotiated B2B market taken into consideration. 


About the Author

greg peters 

Greg oversees all of Zilliant’s operations, including its strategic direction, product planning and development, as well as its financial management. Under Greg’s leadership, Zilliant has grown into one of the leading providers in predictive B2B sales guidance and has pioneered new approaches for companies to harness the power of Big Data. Prior to Zilliant, Greg served as president and CEO of Vignette, the leading content management company and one of the most successful initial public offerings in 1999.

He also served as president and chief executive officer of Logic Works, Inc. and controller and chief financial officer for Micrografx, Inc. Greg sits on the board of directors at LiquidFrameworks and Rhodes College, and is an accomplished industry speaker who has appeared at numerous leading industry events.


1Grandview Research, "Sales Intelligence Market Size," August 2020

2Gartner, "2020 Magic Quadrant for Configure, Price and Quote Application Suites," September 2020 
Published Friday, December 11, 2020 8:00 AM by David Marshall
Zilliant 2021 Predictions: The Future of B2B Pricing & Sales - 11 Finance - (Author's Link) - December 11, 2020 9:30 AM
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