The Value of Testimonials
If you’ve not seen the latest CarFax commercials, they’re pretty funny. Essentially, the buyer wants to see the CarFax report and the seller doesn’t want to give it to them. Here’s my favorite:
Yet, as enterprise software buyers asking for references, this is essentially what we’re accepting from the vendor – a note from the prior owner.
Several years ago, I started to put together a list of folks I’d rather talk with and I’d love to hear your suggestions as well. These include:
- customers who never finished implementation (for any reason)
- customers who discontinued maintenance in the last 12-24 months (I want to know the number as a percentage of total customers and I want names/contact details)
- customers who are similar in size of implementation to me, but who had exceeded planned implementation time
As a customer myself, I would never hesitate to serve as a reference under these circumstances. Would you?
The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish. Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.
Comments
2 Responses to “The Value of Testimonials”
-
"an invaluable guide to one of the software’s industry’s most maddening and, at times, controversial topics..."
-Rick Chapman, Editor Soft*Letter
"I would endorse Jeff's book. It is so great I wish I wrote it myself!"
-Jim Geisman, Owner Marketshare, Inc. -
best references are from peer companies in background. Part of my value as a negotiator is to facilitate such calls/visits. The vendors often don’t even know about them
In the short term, a vendor that provided lists of references like the ones you suggest might well sacrifice some sales. If the vendor’s license revenue is booked up front and the sales force’s commissions are paid that way (both are the traditional approach), then the sales guys would hate the idea and vigorously oppose it.
Over the long term, though, such a vendor might generate more trust — especially if it proved responsive to negative feedback — leading eventually to a healthier long-term financial picture.
(Cf. your <a href=”/trust-revisited/comment-page-1/#comment-839″ target=”_blank”>your earlier posts</a> on the difficulty of building trust into a contract.)
Realistically, a company might have to revisit its revenue-recognition and sales-commission policies before it could experiment with this approach. That could be an insurmountable obstacle, especially for a public company.
Which is to say that start-ups should be thinking about this approach early on, before they make policy choices that could preclude their trying it later.