Russ Chadinha of PROS: Automating Quotes and Pricing Improves Revenues and Customer Experience

Many products and services today come in a bunch of different configurations. Just think about the options you face when shopping for computers, phones, a car, or even plans for wireless and cable services. Screen resolution, hard drive size, color, etc. Keeping up with which customizable pieces work with others manually makes it more difficult to make the right offer to the right customer at the right time. That’s especially true in a world where customers expect immediate responses for everything.

Russ Chadinha, Director of Product Marketing at PROS, a software company that helps organizations use big data to sell more effectively, shares how CPQ (configure-price-quote) applications can help them sell more, be more efficient, and improve the customer experience with the sales process. (This transcript has been edited for publication. To hear audio of the full interview, click on the audio player at the end of this article.)

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quote pricingSmall Business Trends: All right, this is Brent Leary and with me right now is Russ Chadinha, the Director of Product Marketing at PROS. Russ, thank you for joining me today.

Russ Chadinha: Hey Brent, it’s always a pleasure to talk with you and be with you. Thanks for having me.

Small Business Trends: Absolutely. Now before we jump into this whole discussion about CPQ and what it is and how it impacts the customer experience, maybe you can give us a little bit of your personal background.

Russ Chadinha: I’ve spent about 25 years in the tech space. I started out as a marketing person in the direct computer business, and was able then to move along to companies like Compaq and HP, and drive marketing of new products, new go-to market strategies, business development and then ultimately spend time in the sales space.

Small Business Trends: Talk a little about your current company, PROS.

Russ Chadinha: PROS is a software company that uses big data and real science to take that data and provide prescriptive insights around revenue management, pricing effectiveness, and sales effectiveness.

Small Business Trends: Maybe you could give us a high-level definition of CPQ (configure, price and quote) and how having a system in place to automate the roll out of different configurations for different products can impact the customer experience?

Russ Chadinha: What makes it so powerful is it’s able to provide a consistent experience across your go-to market channel. If you have a direct sales force or you have an inside sales team, if you have partners, or even if you have B2B commerce, you can manage that experience across all those channels from a single repository. Very efficient, but also very effective if your customers are coming at you from multiple channels; they will get the same consistent experience.

What does that mean? They’ll see the products presented in the same way. They’ll be priced the right way so they won’t have an arbitrage opportunity with you from a pricing standpoint, and they will get a branded experience in every interaction.

We also talk about the speed of the customer today, and CPQ really makes it much more efficient for them as well. The sales team is responding to them more accurately. And research is showing that there are fewer interactions when you’re using a CPQ tool. And although you may be spending a little less time with a customer, that’s not a bad thing, and customers really appreciate getting a great, consistent experience.

Small Business Trends: And they like to control as much of their buying process as possible. Does this allow them to at least feel like they have more of an ability to manage their process?

Russ Chadinha: Yeah, that is so true. And when you talk about the complexity of product today, just being able to ensure that you’ve got an accurate quotation from your suppliers is really a time-consuming activity. You get these complex products in. You need to review them, make sure that it has everything that you’re looking for on it. It’s the right way, the right thing, right price, the right time. And providers that use CPQ tools are able to ensure they’re providing an accurate, comprehensive, complete quote. And that makes it much easier then for the procurement activity to be faster, to actually build trust in that interaction.

Small Business Trends: Let’s look at it also from the perspective of the sales person. It seems like this allows them to have information at their disposal and have a greater opportunity for up-sales or cross-sales in a more efficient way.

Russ Chadinha: Let’s use a quick example. Say you’re a new sales executive and have a customer looking for a complex solution from you. And as you go through the process of defining the solution, CPQ tools will give you a guided selling experience. It will talk you though the questions about the customer and allow you then not to be a product expert, but to understand your customer and their needs. And using the answers to those questions, it will then make a recommendation on a tailored, comprehensive solution for that specific customer so making it easier for the sales person to create the right tailored offer for that specific customer, saving them a great deal of time but also ensuring that it’s accurate.

Additionally, it will provide recommendations. So now the sales rep will get suggestions on other things with that particular package or that solution that you should consider or make available to the customer. So now they’ve got cross-sale and up-sale recommendations as well.

And all of these then create this interaction and engagement with the customer. They can buy more of what they need from you. Now you start to move from a supplier to a trusted partner — somebody who has demonstrated that you can provide them complete, full solutions, and somebody that they can rely on for speed of execution and accuracy — again, back to the idea of becoming a trust advisor.

Small Business Trends: Yeah, and it seems like there’s some tangible benefits that are coming right from this approach.

Russ Chadinha: Research says somewhere in the area of 49 percent increase in productivity, which is coming from the speed at which they’re able to turn around those quotations. But we’re also seeing a reduction in the sales cycle. It takes fewer times to iterate the quote and the offer, which makes it much simpler and faster as part of the sales cycle.

We’re also seeing then through the cross-sale, the up-sale and the guided selling capabilities. They’re providing a larger, more comprehensive offer and solution. So that’s actually increasing the revenue and the margin.

And just the sheer number of more opportunities they can handle. I can be more efficient with those opportunities, and I have a greater earning potential as a sales rep.

So it really helps your revenue attainment, helps your sales cycle decrease. Your win rates actually go up because you’re faster, you’re more accurate and you’re getting more activity from your clients.

Small Business Trends: The kind of numbers you’re talking about, does that happen when a service like yours is integrated into something like a CRM application?

Russ Chadinha: CPQ by itself is great. CPQ with CRM is really good, but if you want true business impact then you add in the price optimization and guidance.

We’re seeing two percent to four percent uplift in revenue, and now we’re starting to see up to 15 percent incremental margin impact with the addition of price optimization and guidance in the CPQ space — all done within CRM. So what that’s starting to do then is transform a company’s CRM system into a revenue and profit optimization engine; not just efficiency, but effectiveness with real P&L impact.

Small Business Trends: So the bottom line here is that with using these kinds of systems in tandem, not only are you able to optimize your opportunity to sell but it does so in an efficient way where it speeds up the sales cycle. And then probably the most important part is presenting a good customer experience, because now you’re able to provide them a quote that’s more personalized in nature based on the information that they input.

Russ Chadinha: That’s exactly right. And what they’ll find, as you described then, is they’re actually delivering a much better customer experience. And it will actually drive a fantastic business result for them.

Small Business Trends: Where could people learn more about CPQ and how you approach it?

Russ Chadinha: Well we’d love for folks to check us out on our website at

This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.

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Brent Leary Brent Leary is the host of the Small Business Trends One-on-One interview series and co-founder of CRM Essentials LLC, an Atlanta-based CRM advisory firm covering tools and strategies for improving business relationships. Brent is a CRM industry analyst, advisor, author, speaker and award-winning blogger.

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