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What is CPQ Software?
Configure, price, quote (CPQ) software is a type of sales acceleration software that focuses on generating quotes and managing product configuration requests. This streamlines sales activities by providing customers with quick and accurate pricing information based on their needs.
This software automates the quoting process under a defined set of rules which account for variables such as discounts and customization requests. Many CPQ solutions integrate with CRM software, enabling sales reps to take full advantage of existing customer data when making deals. Synching CPQ and CRM software allows sales activity to happen within the same system, avoiding the creation of duplicate customer records.
CPQ software is used primarily by sales teams to streamline the sales cycle. It automates part of the configuration process and quickly generates quotes based on customization requests and customer records contained in the user’s CRM. Sales reps can then send these quotes in a proposal to prospects or customers. CPQ solutions can also be accessed by other departments (e.g. IT, product development) to ensure the best configurations are being offered to customers.
Sales Quote Generator
At the core of CPQ solutions is a rules engine that coordinates resource supply, customer information, and pricing structures. The quote produced by a CPQ tool is based on company pricing and configuration policies, which are taken into account behind the scenes.
The CPQ rules engine might also take into consideration the customer’s demographic information. For example, certain discounts may only be available for customers in a particular region.
CPQ software automates the process of assessing whether customer requests (options/combinations/features) are possible, and how much they will cost. Some CPQ applications help navigate a complex pricing structure that includes a lot of discounts and exceptions. This is especially relevant for companies offering a wide range of highly customizable products such as telecommunications and insurance companies.
CPQ Software Features & Capabilities
Features may include:
Order capturing: Allows the capture of orders across multiple customer interaction channels (e.g. direct sales, contact center, point-of-sales, resellers, customer self-service).
Product configuration: Allows users to configure products and services by selecting bundles, constraints, options, preferences, etc.
Configuration options: Supports a comprehensive level of detail around available and compatible configuration options (e.g. product features, services, quantity).
Pricing rules: Determines price based on rules and hierarchies. Rules may consider customer demographics, availability, and/or product configuration.
Price adjustment: Sales users can adjust or override prices based on coupons, discounts, markups, etc.
Quote sharing/sending: Salespeople can share quotes and information with customers via email, customer portal, personalized URL, or other channels.
Credit approvals: Allows customers to input credit information. This can be checked and approved or declined. Credit score may factor into the quote.
E-signature: Includes electronic signature functionality so that proposals can be approved and signed digitally. Or, may integrate with e-signature software.
Purchase history and open contracts: Provides information about a customer’s current and previous purchases, which can inform new customer sales.
Guided selling/Sales portal: Provides salespeople with tips, recommendations, or question sequences to help with product configuration and quoting, and/or to assist with cross-sell and upsell.
Self-service CPQ: Includes an interface for customers to select product options and generate their own quotes; this is particularly relevant to eCommerce.
Reporting & Analytics: Users can report on and analyze CPQ processes. Metrics may include quoting cycle time, proposal acceptance rates, revenue, etc.
Proposals: Allows users to generate/automate sales proposals. Or, may integrate with proposal automation software.
CRM Integration: Allows sales reps to access customer data and automatically logs CPQ customer interactions in the CRM.
Excel Integration: Excel integration allows quotes to be generated on spreadsheets using underlying CPQ rules.
Key Benefits of Using CPQ Software
Knowledge retention & productivity—helps institutionalize sales knowledge, especially around complex pricing and configurations, for onboarding and training purposes.
Sales alignment—sales teams are aligned around the same configuration and pricing rules, so quotes are consistent and accurate and revenue is predictable.
Efficient sales cycles— upselling opportunities are automated and pricing rules are semi-automated, making sales reps more productive.
Better customer experience—availability and pricing information is based on a customer’s specific circumstances and needs.
CPQ Software Comparison
Before choosing to invest in one CPQ platform over another, consider the following key factors:
Integrations: Does the product you’re considering purchasing integrate with your CRM or ERP system? Some vendors like Salesforce offer both a CRM and CPQ solution. If your business is already using Salesforce CRM, it may make more sense to stay within the Salesforce ecosystem of products rather than integrate a third-party CPQ product with your other Salesforce products.
Deployment type: Are you looking for a cloud-based solution, or an on-premise one? Cloud-based, or software-as-a-service (SaaS), products can be useful if you have an outside sales team that will need to access the software from different geographic locations. On the other hand, on-premise software may allow for more custom configuration of the software.
Ease of use: How easy to use is the software? Will your sales reps need a lot of time to become familiar with the product and learn how to use it effectively? Ease of use is closely tied to how quickly and deeply the product will be adopted across your sales org. Doing a free trial of one or a few different solutions is a great way to get a better feel for the user interface and overall usability of the software.
CPQ solutions are typically priced on a monthly subscription model, per user. Prices start at $75/mo. per user, and can increase to $250/mo. per user depending on the number of features. Most vendors do not disclose prices on their website for enterprise level solutions, but will provide quotes upon request.
Oracle CX Sales (formerly the Engagement Cloud, and before that the Oracle Sales Cloud) is a sales automation software accessible through Microsoft Outlook, iOS, and Android, along with territory and quota management and social collaboration. CX Sales includes modules such as the…
ConnectWise Sell (formerly Quosal) is the quote and proposal solution of the ConnectWise Suite. With ConnectWise Sell, users can create professional technology quotes and proposals that include rich product information, cover letters, and statements of work in minutes and automatically…
QuoteWerks is specialized Configuration Pricing Quoting (CPQ) software that can be used in every industry to create sales quotes and proposals. The vendor’s value proposition is that rather than relying on Microsoft Word or Excel to create quotes, users can benefit from a tool that…
Salesforce CPQ (formerly SteelBrick) is built and delivered on the Salesforce Platform and Salesforce1 Mobile App which enables users to create accurate sales quotes quickly and submit error-free orders on the fly from any device.
Apttus CPQ, now from Conga (the company formed from the merger of Apttus and Conga in May 2020), aims to help companies drive optimal sales behavior by guiding reps to the right products and prices to meet business objectives.According to the vendor, key benefits of using the product…
NetSuite CRM is built on the same code base as the NetSuite ERP product and is usually used by customers who are already using NetSuite for ERP/Accounting.
Qwilr is designed to change the way a business creates and shares documents on the web. This solution allows businesses to turn traditional documents into powerful and interactive webpages that look great on any device. The vendor says this in turn offers businesses access to analytics…
PROS Smart CPQ automates and simplifies the configuration, pricing and quoting process for a sales team, empowering them to instantly create accurate, personalized solutions for each customer. The vendor says what makes Smart CPQ different is the unique combination of dynamic pricing…
CNET ChannelOnline™ is a hosted application with an ecommerce storefront that automates the sales cycle from quote to purchase order. Products from leading suppliers are visible from a single dashboard. At the foundation of ChannelOnline is DataSource™, CNET’s product data solution,…
Who are servicePath?: Leading Configure Price Quote (CPQ) platform for technology vendors, Managed Services Providers, software companies, SI's and VARs. The vendor states their CPQ+ thrives with changing market dynamics, complex configuration & sales, resulting in enhanced quote…
The CallidusCloud CPQ solution has been built to be independent of any CRM. The vendor says that this makes their solution more flexible. The vendor also says their solution provides businesses the flexibility to customize and enhance the solution without the constraints of CRM…
The Experlogix Configure, Price, Quote (CPQ) solution enables your sales team to customize complex quotes and orders with 100 percent accuracy, leading to gains in revenue and profitability. With unique capabilities such as guided selling, rapid line-item creation and automated bill-…
Frequently Asked Questions
Most CPQ vendors offer stand alone configure, price, quote software. Thus, it is not usually part of a customer relationship management (CRM) system.
However, CPQ tools are often integrated with CRM or ERP software. Many CPQ products include rules that are based on customer information that is contained in CRM systems, such as the geographic location of the customer. So it can be vitally important to integrate these two systems.
The biggest benefit of using CPQ software is the ability to automate the quoting and proposal process. Generating accurate pricing quotes, quickly, and at scale would take a sales rep hours of their time, if done manually.
For products (especially B2B products), that have a complex set of components or discounts—using CPQ software to navigate these complexities can decrease the chances of user error if quotes were manually configured. This is another critical benefit of using CPQ software.