Imbroglio of CPQ

CPQ market is evolving towards more integrated, intelligent, user-friendly, and flexible solutions that support modern sales strategies and provide enhanced value across the entire revenue lifecycle.

Salesforce's EOS announcement for its standalone CPQ product underscores this shift towards broader revenue management platforms like Revenue Cloud. Businesses evaluating CPQ solutions should consider these trends to ensure they choose a platform that aligns with their current and future needs . Salesforce's move reflects a broader trend towards unified revenue management solutions. Companies are increasingly looking for platforms that integrate CPQ with other processes like billing, contract lifecycle management (CLM), and revenue recognition. These platforms aim to break down silos between sales, finance, and legal teams, leading to more efficient and accurate revenue operations.

Key considerations put in front of products in market are,

• There's a growing demand for CPQ solutions that offer no-code or low-code capabilities, empowering business users to create and manage product rules, pricing logic, and workflows without extensive IT involvement.
• CPQ solutions are evolving to support hybrid selling approaches, bridging the gap between direct sales interactions and e-commerce channels.
• Cloud-based CPQ deployments continue to gain traction due to their scalability, flexibility, lower upfront costs, and ease of maintenance.
• Emerging economies are presenting significant growth opportunities for CPQ vendors as businesses in these regions increasingly recognize the benefits of sales automation.

Below is comprehensive overview of the CPQ landscape, touching on the companies you mentioned, their acquisitions, and the overall impact on their revenue and investments.

CPQ Conundrum in the Market

1. Salesforce: Steelbrick EOS: As Salesforce phases out Steelbrick, it reflects a shift in their strategy towards more integrated solutions. Revenue Cloud Advanced: This re-innovation focuses on streamlining the revenue process, including advanced CPQ functionalities. Acquisition of Vlocity: This move enhanced Salesforce’s industry-specific capabilities, particularly in CPQ for sectors like telecommunications and healthcare.
2. ServiceNow: Acquisition of Logik.io: This acquisition signifies ServiceNow’s commitment to enhancing its CPQ capabilities, integrating intelligent configuration that can improve revenue processes.
3. HubSpot: Acquisition of Cacheflow: HubSpot’s foray into CPQ through Cacheflow indicates its strategy to offer a more comprehensive sales solution, catering to small and medium-sized businesses.
4. Conga (formerly Apttus): Conga has been a longstanding player in the CPQ space, focusing on providing end-to-end solutions that streamline the entire contract lifecycle and revenue management.

Here’s a concise comparison of the key players:

• Salesforce leads the market with a robust CPQ offering, backed by significant investments and acquisitions that enhance their capabilities.
• Conga, with its established legacy in CPQ, continues to dominate the space, focusing on holistic revenue lifecycle management.
• ServiceNow is making strides to position itself as a CPQ provider through strategic acquisitions, focusing on intelligent configurations that align with their digital transformation goals.
• HubSpot is catering to a niche market with its acquisition of Cacheflow, finding a space among smaller businesses needing CPQ solutions. 

These 4 are not the only options.  The other alternative CPQ solutions currently available in the market are:

• Oracle CPQ Cloud
• SAP CPQ
• Configure One
• PROS Smart CPQ
• BigMachines (part of Oracle)
• Zoho CPQ

How do these Players Stand Out

• Oracle CPQ Cloud: Known for its robust configurability and extensive integration capabilities with other Oracle solutions, making it suitable for large enterprises requiring complex pricing.
• SAP CPQ: Focuses on manufacturing and supply chain, providing deep integration with SAP’s ERP solutions, making it a go-to for companies heavily invested in SAP products.
• PROS Smart CPQ: Utilizes AI-driven insights to optimize pricing strategies, which can significantly improve win rates and margins.
• Configure One: Strong in the manufacturing sector, offering advanced modeling capabilities for complex products.
• BigMachines: Now part of Oracle, it remains a popular choice for companies looking for a comprehensive CPQ solution that integrates well with Oracle systems.
• Zoho CPQ: Offers an affordable solution for small to medium-sized businesses, focusing on ease of use and integration with the Zoho ecosystem.

AI agents are increasingly being integrated into CPQ (Configure, Price, Quote) software to enhance various aspects of the sales process. These AI-powered capabilities aim to improve efficiency, accuracy, and the overall customer experience. Here's a breakdown of key trends and applications of AI agents within CPQ:

AI Agents that will drive CPQ:

• Intelligent Product Configuration: AI algorithms can analyze customer preferences, past purchase history, and market trends to recommend the most relevant product configurations. This ensures that sales reps offer tailored solutions, potentially increasing conversion rates and customer satisfaction. Example: An AI agent might suggest specific add-ons or upgrades based on a customer's selected base product and their historical buying patterns.
• Dynamic Pricing Optimization: AI can analyze vast datasets, including market demand, competitor pricing, and customer behavior, to dynamically adjust pricing in real-time. This helps businesses maximize profitability while remaining competitive. Example: An AI agent could automatically adjust the discount offered based on the customer's perceived price sensitivity and the deal size.
• Automated Quote Generation: Leveraging Natural Language Processing (NLP), AI agents can understand natural language inputs from sales reps to generate quotes. This streamlines the quote creation process, making it more intuitive and efficient. Example: A sales rep might be able to say, "Create a quote for a large enterprise with a 3-year contract for the premium service and 50 user licenses," and the AI agent would generate the initial quote.
• Upsell and Cross-sell Recommendations: AI algorithms can analyze customer data to identify opportunities for upselling (selling a higher-value product or service) and cross-selling (selling complementary products or services). These recommendations can be presented to sales reps during the quoting process. Example: If a customer is purchasing a software license, an AI agent might suggest adding a premium support package or related training services.
• Automated Approval Workflows: AI can enhance approval processes by automatically approving certain deals based on predefined criteria and historical data. This can reduce delays and improve sales cycle times. Example: An AI agent might automatically approve quotes below a certain value or for repeat customers with a strong payment history.
• Risk Assessment and Compliance: AI can analyze contract terms and pricing to identify potential risks or compliance issues. This helps ensure that quotes adhere to legal and business rules. Example: An AI agent could flag a quote that includes non-standard contract clauses or discounts that exceed approved limits.
• Personalized Customer Experiences: By analyzing customer data and interactions, AI agents can help deliver more personalized quoting experiences. This can include tailored product recommendations, customized pricing, and dynamic content within quotes. Example: An AI agent could personalize the language and included case studies in a quote based on the customer's industry and past interactions.

AI-Powered CPQ and Sales Engagement Platforms:

These platforms directly integrate AI into the CPQ process and broader sales engagement workflows:  

• Logik.io: This platform explicitly markets itself as an "AI-Powered CPQ," focusing on intelligent product configuration, guided selling, AI-powered rule creation, and recommendations.  
• Pricefx: Offers a comprehensive pricing and CPQ platform with integrated "PricingAI" capabilities for dynamic pricing optimization, negotiation guidance, and product recommendations.  
• PROS: Their "Smart CPQ" solution leverages AI and machine learning for personalized offers, dynamic pricing, and identifying upselling/cross-selling opportunities.  
• Tacton: Focuses on simplifying complex product configuration with AI-driven recommendations and intelligent quoting.  
• Moveworks: While not directly providing CPQ AI agents, its platform could be used to build custom AI agents that integrate with Salesforce and indirectly support CPQ workflows through CRM automation. The acquisition by ServiceNow might lead to more direct CPQ AI capabilities in the future within the ServiceNow platform.  
• Emplay: Appears to be directly involved in providing AI agents that can assist with various stages of the sales process, including tasks closely related to CPQ such as quote generation, pricing guidance, and upselling/cross-selling
• Dassault Systèmes (SOLIDWORKS CPQ): Integrates AI to help configure products based on customer requirements and generate accurate quotes quickly, connecting design, manufacturing, and sales.  
• Wipro HOLMES™ (for Oracle CPQ Cloud): An AI and automation platform that integrates with Oracle CPQ Cloud to provide AI-driven pricing, contract anomaly detection, and intelligent recommendations. 

As the CPQ market continues to evolve, the integration of AI agents will play an increasingly crucial role in helping businesses optimize their sales processes, drive revenue growth, and deliver exceptional customer experiences. The CPQ landscape is rapidly evolving with major players enhancing their offerings through acquisitions and innovations. The move towards integrated and intelligent solutions is a clear trend, as companies aim to streamline the sales process and improve revenue outcomes. As businesses continue to invest in CPQ solutions, understanding these dynamics will be crucial for staying competitive in the market.