How do you sell integrations to your customers?
What gotchas do you need to be aware of?
How do you approach complex integration sales?
Learn all of this and more in this episode.
Click here to download or listen to this episode now.
Resources mentioned in this episode
Transcript
Phil Zito 0:00
This is the smart buildings Academy podcast with Phil Zito Episode 273. Hey folks, Phil Zito here and welcome to Episode 273 of the smart buildings Academy podcast. And I am super excited to be here with you today, not only because I'm recording a podcast, but also because it is the last week of summer vacation, which means you're going to be seeing a lot more content coming out. We've got a live training course on sales that is going to be coming the second week of September. If you're looking to learn about how to sell building automation systems, you'd like to get better at estimating selling, you'd like to understand how to sell in new construction retrofit and solution sales environments. And you'd like to be able to discuss this in a live environment with experienced salespeople, then I encourage you to check out our sales bootcamp Cohort Two, which will be going live on the seventh of September. So you can find out more about that by going to podcast smart buildings academy.com, forward slash 273. Once again, this podcast at smart Billings, academy.com Ford slash 273. Now just like the previous two lessons on integration, we're going to spend a bit of time getting to the core basics of selling integration. And then we're going to talk about selling lighting integration. So like the previous two lessons, previous two podcasts, this one's going to be a little bit longer. But then we're going to continue this moving forward as we go through AV access control. And other systems, as I see fit over the next couple of weeks. So how exactly do you go about selling integrations? Well, there's really, you know, three ways that integration sales come about. There's the integrations that are just part of a plan and spec project, right. So you're playing a spec project, you go into, you know, div 23, you check out what's in related sections you sue lightnings and related sections, you check out the general section in your specification, I'm talking CSI masterformat, you know, primarily used here in the United States. And you'll see in the plan and spec projects that, hey, I've got some integrations here, right, I've maybe got an integration to power metering, maybe I've got an integration to lighting, maybe I've got some integration via BACnet cards to chillers. So that's kind of the first way you'll find out and you're not really selling integration, per se, you are estimating integration. And there's a big difference between selling the value of integration and estimating cost of integration. Estimating, you know, I was on I think it was Reddit, the other day may have been Facebook. And this one guy said, hey, I've got this quote from an OEM for a supervisory device, and then some third party integration, and it's like $25,000 is like, is this a good price? Or is it not? And the answer is, yes. No, maybe, then that's the thing with integration, whenever you're integrating the actual cost of the integration is largely variable, you know, is this an existing site? You know, am I doing a plan and spec job. And you know, in our design course, for example, we have a university expansion that people work off of for their design project. And as part of that expansion, there's an existing chiller, chiller three, and it's got a back net interface. And there's some notes if you actually pay attention to the submittal set, specifically the MEP submittal set that mentioned about the back net integration and what to do and what not to do. And that's the catch, right? with some of these plan and spec project, you're putting in all new stuff. And integration really isn't that big of a deal. You just go through kind of what I discussed in episodes 271 and 272. Right, we do our research, we understand what data points we're integrating, we understand how the use cases coming together, then we work on the physical implementation. And then we just test it, you know, Bob's your uncle, super easy. In those scenarios, cost is actually fairly low. It's no different in my opinion, then going and adding in a controller from a costing perspective. Now, when we get to existing sites in we're still talking planets back, we haven't moved into design building, we haven't moved into owner direct retrofit yet. But still in planning spec, an existing building.
Phil Zito 4:40
Now things get a little more complicated because if the points aren't exposed, and if people don't know what systems in there, you got to actually do a sidewalk and sometimes you can't do a sidewalk. And maybe there's not even an equipment model number so you don't know what points and what capabilities are available to you from an inner gration perspective. So what's the salesperson to do? Well, there's a couple options in these scenarios. Option one is you think about worst case scenario and say, Oh, we might have to replace with a new bagnet card, we may have to actually put a controller on and you go new quote, basically putting a controller on and controlling this manually in case you can't integrate. Then there's the other scenario, which is, Hey, I'm going to swag it, I'm going to just treat it like another integration. And I'm going to use exclusions. And that can sometimes work, I wouldn't do it with government work, I wouldn't do it with large municipality work, large institutional work, they're probably going to slap down those exclusions and just say we don't accept them. So just be careful understand the general conditions of the project, understand what you're going to inherit, as far as responsibility, you know, if it's, as well as the funding mechanism, is it a GMP? Is it at risk, you know, those are both contractual as well as funding mechanisms. So just understand those things and how they impact your scope and your exclusions to your scope and your assumptions to your scope. Alright, so you've got that you got those two basic kind of scenarios, no one really meets in the middle of the road, when it comes to integration costing, they either swag higher, they swag low, I don't, I don't know why that is, it's just, it's always been that way ever since I've been in the field, and probably will continue to be that way. Then we move on to kind of design build integrated project delivery, p3 projects, anything where there's a collaborative environment. And in a collaborative environment, two things tend to happen one, the integrations tend to be more complex, because this is more of a designed solution. And people are more willing to be focused on use cases, business outcomes, etc. And because of that, your integrations are going to be more complex. So they're going to be more costly. And these kinds of scenarios, how I like to sell is with a project development agreement. And I like to do this owner direct as well. And a project development agreement is basically we're going to develop your integration use case, we're going to develop your integration maps, we're going to come up with your solution. And then based on that, if you choose to accept us that cost will be applied to the implementation, if not, you pay for the integration design, and you can take it to whoever you want. And you know, that is a favorable way of doing complex integrations, it shifts the cost of sales off of you, it reduced the risk to your business. And it gives you revenue to basically justify all your sales efforts. Because whenever you're selling complex integrations, whenever you're selling developed solutions, those are time consuming, and they're taking time away from sales. So in order to keep your sales manager happy, in order to keep your revenue flowing, you need to be able to offset that cost as well as have commitment from the owner, because we don't want to just be going willy nilly and committing our development resources to developing integrations and developing solutions and just being like, Hey, I should buy this because I'm spending time here. We don't want to take that approach. That's a really bad idea that unless you're a major OEM with money to burn, your business probably will not survive too many of those. And then we got the third solution, right, which is selling owner direct. And owner direct is both my favorite way to sell as well as my least favorite way to sell. It's my favorite way to sell because as a creative as someone who is an idea person, you ask anyone on my team, I love ideas. I love coming up a strategy. I love coming up with vision, I am not an executer I'm not the person to go and execute. I'm the person to read the tea leaves, understand the market, understand kind of what's going on. I'm really good at that. And then understanding the problems and coming up with the solution and handing it off to someone else who is very detail oriented, who's going to execute it. But so, I mean, if I can do that, that's great, right? I love consulting,
Phil Zito 9:08
I love doing those kinds of things. It's when it gets nitty gritty and in the weeds and really detailed. That's where I'm like, Man, this frickin sucks. I hate life. So that's kind of the double edged sword with owner direct sales. If you have a team structured as such that you can identify the business problem, create a business use case, create buy in among executives, and then hand it off to the executives team as well as to your development team. And those two can then collaborate. That's great. That's a great way to sell integrations, especially if you're using project development agreements, which is what I mentioned, or you're doing it as, you know, time and materials. That's great. It's when you as the salesperson have to lead this integration and quite frankly, you shouldn't be in My opinion, the skill set to do integrations, complex integrations is completely different than the skill set to actually sell these integrations. And I mean, that's kind of where I was miserable at my previous employment was I loved going in front of the customers, problem solving, creating solutions, creating ideas, but I didn't have anyone to hand it off to. And so I actually had to implement it. And I was good at implementing. I had a knack for it. I still do, but I didn't enjoy it. And so that's something that you just need to be cognizant of from a sales perspective. So the three types of selling right plan and spec, we talked about the issues, they're really reading the specs, really reading the MEP set, understanding the details and the notes. So you understand exactly what's going to go on being cognizant if it's integration to an existing site like planet spec, major retrofit expansion. And being aware of that, so that she cost properly talked about design, build, IPD, p3, and the collaborative approach to that we talked about the need to get a project development agreement. And we also talked about owner direct work. Once again, project development agreement, beware that you're typically going to be the construction manager at risk in that scenario, and you're typically under a guaranteed man maximum price scenario. So you really want to do as much pre development paid pre development as possible to make sure that you're scoping is accurate. Now, how does all of this have to do with lighting? I mean, we're 11 minutes in and you're like, Phil, you haven't talked about lighting at all. So let's talk about lighting. So plan and spec lighting, pretty simple, right? We're going to have a project and the lighting manufacturer Lutron Oh, my gosh, I don't know why all the other lighting manufacturers names are escaping me. That is freakin crazy. They, they have such brand recognition that they're the ones who pop in my head. And everyone else is like escaping me even though I know there's tons of other ones. So forgive me other lighting manufacturers for not remembering your names. That being said, Lutron comes in there, right, they put in their quantum gateway with the back net option you map it in. It's all in the dev spec. And typically, it's just going to be lighting and zone control, integrated into the graphic for monitoring only or for control. And as we know from podcast episode, 272, and 271, we need to go and do our data map, we need to understand zones to spaces, we need to map all that out. But that's typically done during the middle phase, not by the salesperson. So from a costing perspective, from selling perspective, you just need to make sure who's got the gateway who's got the BACnet card who's got the setup. And then you need to add some time for supporting that setup, testing and validating. So typically, what I like to do is if it's a single building, I'll add like a day or two, usually that dare to covers everything. And in my scoping, I will add the exclusion that or add something to the scope to say basically, lighting system is set up and validated prior to execution of integration, any additional requirements based on improper setup or team not being ready will be at contractors cost. And then I'll just you know, throw it in there, quote that and call today. When I get to selling design build, once again, this is more collaborative, usually your you know, SD or earlier, maybe even prior to tendering. And you know, especially if it's like a p3 or IPD, where you're part of a team of consortium, and you're selling that way. And you're basically selling off of use cases. And lighting is just one of the use cases. And so you just start identifying the business needs. And can I solve that with lighting, you know, business needs, maybe safety,
Phil Zito 13:59
maybe he gress maybe going and saving energy, maybe going and Wayfinding there's a variety of lighting use cases that you can actually implement. And if you're ever curious about it, just go and look up smart buildings, like literally if I go here, I type ns smart buildings, lighting use cases. You literally just type that in. And you'll get like the role of lighting and smart buildings, you'll get unique, connected lighting use cases. I like that one with the IoT podcast and it's got, you know, a bunch of different IoT lighting, use cases little pie in the sky, to be honest, but there's some cool ones in there. So that and then owner direct. It's like a combination of the two, right? So what we're going to do for owner direct is we're going to be focused in on going and understanding The owners problem understand the use case, this is usually going to be an owner that we already have a relationship with from a service perspective. And we're going to be going as part of our, ideally quarterly meeting with the owner, we're going to be talking about their pain points, understanding that lighting may be one of their pain points, some of the signs that lighting, maybe a pain point is we visit their site at night and their lights are on or maybe it just looks crappy. I know that's not a very technical term. But I've walked into buildings where the lighting is trash. And I'm like, Man, this is crap I would hate to work here is demoralizing, it is definitely affecting the business, it's definitely affecting the productivity of the employees, it's affecting safety, potentially, let's fix this. And then you could pull so much data around that, understand who you're selling to the facility manager probably doesn't care as much as maybe a business unit leader. And also, if this is an investment property, it's going to be a completely different response than maybe a school district, you know, with a school district, you could potentially show the benefit of lighting to education and retention and student test scores. And you go and communicate that to the school board or to the superintendent, you'll get a different level of engagement, you'll typically get pushed down. But that will at least start a conversation. And then maybe there's incentives from the local utility, you're starting to see I hope I know I'm like throwing a bunch of ideas at you. But I want you to have this kind of thinking like, okay, who can I talk to? Who is going to potentially be influenced? And how are they going to be influenced. And always keeping in mind, if you've ever done business with us, we tell people like don't take our training, if we don't think it will fit them. Always keeping in mind. If lighting integration isn't good for your customer, don't suggest it just because you want to get a sale, you know, yes, you may get a sale, you may be able to put fear into people and get them to buy something. But at the end of the day, they're not going to use it, it's not going to benefit their business. And that reputation is one you don't want to have in our industry. So this all being said, this is an approach to selling lighting integrations and our approach to selling integration as a whole. Over the next several weeks, we're going to be looking at more types of integration. Next week, we're looking at audio visual week after that, I think we're looking at access control. And my hope is that we will start to dive more into use cases start to dive more into scenarios. I'll tell you some lessons learned just things I've discovered working with these systems. And my hope is that you can take all of this information and use it to better serve your customers if you are an owner, to better serve your tenants. And if you're an engineer to have better designs, as always, if you have any questions, please go to podcast smart buildings academy.com Ford slash 273. Once again, that's podcasts at smart buildings academy.com Ford slash 273. And I can't encourage you enough to enroll in our VA s sales bootcamp that nine session live course you will come out of that. And I tell you, our students have written to us after going through that, that the course is paid for itself. They've increased their pipeline, they've increased their close rate, they've increased their confidence to go and approach the market and to approach different customer buyers, different customer types and different buyer types. And you can learn more about that at podcast at smart buildings academy.com forward slash 273 scroll down and click on the VA s sales bootcamp link. Alright, thanks a ton and I will see you next week. Take care
