Talking to partners and customers over the years, we’ve learned that digital assets are a key factor for success in a competitive business environment. Machine builders and OEMs can use them to extend their offering, adding value for their customers, but also creating new revenue streams.
In September, we welcomed more than 80 decision makers and experts to the Wien Museum in Vienna. The goal of our Digital Business Summit Vienna was to promote an open exchange between machine builders, OEMs, and suppliers about the commercial potential of digital services, their go to market strategy, and the challenges inherent in integrating them into the sales process.
Selling digital services is much harder than developing them
Our audience confirmed – while the development has some challenges, in terms of real-time data acquisition, connectivity, and cybersecurity, the greater challenge can be to sell these services to customers. Often, customers view these services as free add-ons, rather than valuable assets in their own right.
It's still difficult to charge for the software – hardware is established.
Our customers are happy to pay for hardware, but not for software.
Gunther Machu, HOERBIGER Compression Technology
At the Digital Business Summit Vienna, we heard from companies that have successfully leveraged their expertise and created digital services they are now monetarizing. WashTec AG and XITASO, Burckhardt Compression and TTTECH, as well as Voith Group shared their projects and showed how they collaborated to turn digital services into sustainable revenue.
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We also deepened the understanding of what needs to be considered to successfully implement and sell digital services in two panel discussions:
- From feature to revenue - how digital machine services become profitable with XITASO, KEBA Group, and HOERBIGER Compression Technology.
- Proving value, securing margins - what makes digital services marketable with Fill, Burckhardt Compression, and WashTec.
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Here are some of our key learnings from the Digital Business Summit Vienna
You have to start with customer value and tangible benefits, not with features and technology.
Christoph Knogler, KEBA Group
- Digitalization is not a short-term project. It requires time and investment, thus it needs a commitment from senior management.
- Digital applications are mostly rolled out in brownfield environments, because machines have long lifecycles and greenfield developments are rarely possible.
- Customer value is the starting point, with a clear value proposition and feedback from users.
- Tangible customer value may mean rethinking existing business models or creating new ones.
- When it comes to the ‘make or buy’ decision, many companies said that having a partner like TTTECH Industrial that covers a part of the digital service solution is highly beneficial.
- The customer value proposition of digital services must be understood and promoted by the sales team.
Aside from the presentations and discussions, we also took away many new ideas and inspiration during the networking breaks. Our location in the heart of Vienna provided a beautiful backdrop to sharing experiences and tips, because offering digital services pays off.
We have a much closer customer relationship; we are not merely a service provider who is only being contacted when something happens - we have a constant relationship.
Rainer Duebi, Burckhardt Compression
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Are you a machine builder already using digital services or looking to implement them?
If you have encountered any of the topics mentioned above – a takeaway from the experts at the Digital Business Summit was that there isn't a concept or digitalization path that fits everyone. Generating revenue with digital products and services is possible, but how you design, implement, and monetarize them will depend on your organization, sales processes, your machines, your customers, and business goals.
If you want to discuss a business case or are looking for an edge platform to provide secure connectivity and real-time data – in brownfield or greenfield setups – get in touch with us.
We can support your digital solution throughout its lifecycle – from consulting in the design phase, to testing, rollout, and operation. Our IIoT platform Nerve provides a cybersecurity-certified, CRA-ready, and modular edge basis for your digital solution, allowing you to concentrate on your key competences.
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