Upsell versus downbuy - Purchasing meets sales at IBM's smarter commerce event
IBM has managed to preserve the best qualities of Empower
Published 11:00, 18 September 12
- Firstly, there was still a good focus on sourcing and procurement in the Empower event-within-an-event. IBM has preserved Empower’s best quality (and that of Ariba Live and Zycus Horizon, btw), which is that there is always lots of trends and best practices content, and not too much product plugging. Most of the event was aimed at marketing, selling, and servicing, but there was plenty for sourcing attendees too. For example, there were keynotes from the CPOs of AB InBev, Conoco Philips, and IBM itself about their priorities and how they are addressing them.
- IBM leaders, including Craig Hayman, General Manager Industry Solutions, gave a clear and credible vision of Smarter Commerce. Hayman portrayed his Buy, Market, Sell, and Service quadrants as discrete offerings sharing common principles and technology, rather than an engineered stack that only works properly if you buy it all — best-of-breed complements to ERP, not a rival suite.
- From speaking with Emptoris executives, and from what I saw at the event, it appears that Emptoris’s vision remains intact. I particularly like the progress in the key growth category of supplier risk and performance management (SRPM), where Emptoris has developed the Supplier Lifecycle Management product it got with Xcitec, integrated it with its own Virtual Supply Master and enriched them both with IBM technologies such as Cognos. It's good for Emptoris that IBM didn't already have competing products in this area, unlike SAP and Ariba that have several overlaps with each other, as I explained recently in my report The SAP/Ariba Merger Will Not Be Frictionless.
- The seller wants to entice customers’ employees to use its website instead of an internal procurement system. Not only does it want to prevent them choosing a competitor’s products, it also hopes to use its web site features to lure them into spending more money than they otherwise would have done.
- The buyer wants to promote down-buying, not allow upselling. He wants his buyers to search across all approved suppliers. He certainly doesn’t want his suppliers up- and cross-selling to his users — in fact, he wants the opposite, what one might call “down-buying.” For instance, Rob Bernshteyn, CEO of Coupa (who was a gold sponsor of the Empower event) told me about features in his eProcurement product that encourage requisitioners to pick cheaper products that will meet their needs, rather than going with the more expensive item that fit their precise search.