Today’s BuzzoodleCast is Improving Sales and Saving Money with Videoconferencing. Ron McDaniel interviews Jim Hornyak on how to use videoconferencing equipment to help sales people save time and close more sales. They also talk about some of the other impacts of videoconferencing, such as cutting travel costs.
Improving Sales with Videoconferencing
Ron McDaniel & Jim Hornyak
Ron McDaniel: Hi my name is Ron McDaniel and welcome to this version of BuzzoodleCast.
Today we’re going to be talking to a guy I have known for many years, Jim Hornyak. An expert on networking, video conferencing and probably some other stuff I am unaware of. He is also a very good skier. I don’t know from experience even though I have gone skiing with him, he is usually way ahead of me so I have never actually seeing him ski, other than right at the top of the hill.
So, we are gonna be talking very quickly, very singly about how these video conferencing to make your business more proficient, save money, and increase sales.
And Jim, you have had an interesting way you got into this business in the first place. This was not part of your career plan, correct?
Jim Hornyak: Yeah. It is quite a story actually because 15 years ago I started with a company with fold LCD displays protection equipment and basically we were a back house. And what happened over time, most products started to be commoditized and my boss said, “Hey we have to look into this video conferencing. This could be another product we could get into.”
So, we got into that and this is right were the standards in video conferencing were being established. And we had a meeting to setup all the bridge company and this bridge company said, “Hey, we are going to demonstrate a technology for you guys.” And we asked, “What does that entails?” They said, “Well we are going to connect to a hundred different locations on a bridge in four different time zones and we are going to be in conference rooms like you guys all over the country.” And I go, “We will jump in on that. I want to see that demo. For sure this thing was going to crash.
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Well, low and behold we had a meeting. And not only the meeting did not crash, they had the bridge set for a single monitor. So whoever asked the question or whoever said anything, they would be the only image on all hundred monitors in four different time zones asking that question.
Then it dawned on me after that demo that this was better than if we physically got together because I said that they would think about that. When Sam in St. Louis asked a question, everybody saw Sam on, you know, a 32-inch monitor which was a big monitor and we all heard him. And we are all in these conference rooms and we are all hearing Sam.
Now if we were on an auditorium, and Sam asked that question and he was in the front row and the presenter did not repeat it, we would be left questioning why what does this answer mean. So, it dawned on me at that point, at that moment that video conferencing is going to change the world. It is going to change how we do business. It is going to change how we communicate. It is going to change how we make decisions. It is going to change how we travel or how we don’t travel. And that is really got the ball going.
At that time, the equipment was not that good but then it started to get a little better and there was some innovations in particular with Polycom that created what is now known as the set-top unit* that made it a little more affordable and a lot easier to install.
So that is what got me into business, Ron.
Ron: Interesting! And back then it was. . . What was the system like that running? What did it cost?
Jim: Well, back then you had a really budget clearly high. Systems generally were $50,000 and up per N point. But then when Polycom came out with the view station model, at that part, we weighed down below $10,000. So it was heading at the right direction and then it got a lot easier to implement.
Ron: And now I think we will talk about pricing towards the end but I mean the range now is somewhere where just about anybody can do this now. Right?
Jim: Absolutely. You have to get a good board room video conferencing system. We call it a digital codec which means coder-decoder which kind of like a generic term for the technology. But you can get a good board room high definition system for under $4,000. And we are great.
In fact, in our business we own 3 public rooms and then we have a really nice board rooms. And I will talk a little bit about little public rooms in a little bit. But, these are really good systems and that is how far the technology has come.
Ron: Wow! So less than 10% of what they cost just 10 years ago or 8 years ago, something like that?
Jim: Yeah, exactly. And then the cost less than some copy machines and a lot easier to operate.
Jim: And some other tool from the office.
Ron: We’ve got three core questions and the first one is going to be how this kind of video conferencing equipment can save company’s money. Because you were really always looking at ways to make people more proficient and grow their business and of course proficiency, partially saving money and saving time.
So, tell me how you have seen this and give me some specific examples if you can of where using company save big money with this kind of systems.
Jim: Well, yes. The obvious one is travel. And in fact, we have a calculator on our website that will calculate the travel versus video conferencing. But there was one study done before. It was actually done in 1998 by WorldComm of companies. They were the ones that had business.
But, it was really interesting what they compiled for a person to. . . If you will look at the flying time, the driving time, even the meeting prep time and the meeting duration. When we are doing video, it goes down and one study showed 21 hours versus 4 hours. If you will multiply that times 4 or 5 people and with their time is worth to the company; that is huge. And that goes right to the bottom line.
So the first obvious return on investment is travel. The second one is, now with these systems was called collaborating so I can meet with you face to face. You could punch up your computer. I could punch up my computer. We are seeing each other’s computer in real-time. We can annotate whatever we are showing. It accelerates the decision making process in a company. So, if you are on a team, and the team is spread out, no one has fly in for a meeting. You could have a face to face meeting on the fly, ad hoc, and now with the mobile app, I can meet you on my iPad, I can meet you on my iPhone and droid and we could collaborate.
So what it really does, it accelerates the decision making process in a company. Productivity also goes way up. We are running into situations where clients have film engineers and they are out there with their iPads and they have got to show a problem out of the field on a wireless network off more often than not a 4G network, which is by the way, works really well. And they can get a high definition, real-time video conference from the field back to the home office. So troubleshooting is accelerated. Decision making, troubleshooting, collaboration, and the obvious one, travel, it has a huge impact.
I equate it to like cell phones and email. I mean, imagine if you didn’t have cell phone access or email access in your business today. How would that affect that business? It would have a detrimental effect on.
So that is where video can really save money. It really makes a company operate much more efficiently on many different levels.
Ron: Didn’t you have one client that was making like monthly trips to China and was able to cut that out or something if I remember right?
Jim: Absolutely. We have many factories that had a plant there and this goes back, years, and the CEO is flying out once a month to China. And I said, “You know, you could get a system for your conference room and a system for the plant in China, and you could accomplish all these. So, it eliminated all that.”
Now, you have the expensive travel. But look at the expense of having the CEO away from the home office; technically bigger. So that worked out really well. In fact, we ended up putting one in his home because of the business in hours was 13 hours. So, if you left at a conference in the middle of the night, it is really convenient to have a system at home. So that worked out really well.
In fact, in our business they are all hanging through their people flying overseas a lot. We have another client going to England every other week. So you run into those executives and it really stresses their life. I mean, it takes them away from their family. They are not as productive. I mean, when you get over there you have the jetlag issue to deal with. You are not as sharp. This is a clear example how video conferencing could really impact in a positive way for those international clients.
Ron: That is cool. And the CEO can be there in his pajamas. So how convenient is that?
Jim: That is right. Everybody, when they call me, I have video conferencing, obviously but I have it in my home office. So I have an office and just thought I am at Cleveland in an office complex. But I am very literally there. I do have a lot of meetings there but I appear on video.
Ron: Exactly. And at least rest from the waist up, right? Because you are seated at a desk.
Jim: That is right. Exactly. That is another thing that is going to happen in our business. I was called for lag issues are always interesting.
Ron: OK Jim. The next thing I want to do is ask you at really something more nearer and nearer to my heart obviously and that is how video conferencing can affect sales and marketing. Because, there is a lot of options out there obviously some of the most reasonable or extremely low cost but there is a whole professionalism issue and stuffs. So, can you tell me about some of your more advance technologies can have a better impact on sales?
Jim: Oh sure yes. This is a question near into my heart too because we use it. I mean we believe in what we sell and we use the technology for our sales here. In fact, I don’t get in a car at all when I make a sales call. What I do while I am on video when I use the app. But what I want to do is go back to the hardware really quick and tell a sales story on a hardware system or what we call a codec that goes into the conference room.
One of my telecom partners, they are a 20-year old company that provides circuits long distance, network. In fact, we are very close. We are joined at the hip with them. We recommend them with most of our projects. And a few years ago, I installed the video conferencing system, a small one. It is a video phone, not that big, in their conference room. And long behold, they have never used it. They never thought they needed it.
And I got a call from the VP of sales earlier this year saying, “Hey, remember that video phone you put in our conference room? I said, “Yeah.” He said, “Well, guess what?” I said, “What?” . . . “It helped us closed the biggest deal in our 20-year history.” And I go, “Why can’t wait to hear this story and then low and behold they had an opportunity up in the Wisconsin.”
It was impossible logistically for them to go up to make the sales call but they asked out of desperation to engage with this client had video conferencing. And they said, “Oh yes, we got it.” And they said, “Well we have it too.”
Well the good news is, it is all standards space. So, they did not need to know anything but an IP address. So they made the appointment, and that on video, it was an hour and a half meeting, and they said they closed the biggest contract in their 20-year history on that video phone. And he said, the phone paid for itself in 2 hours. The size of the contract was just unbelievable.
I love that story. These stories that I learned about video conferencing, I learned from the clients. I learned from them implementing that in their application and really stretching the technology and taking it to the edge where it can do. . . I mean that is what drives the whole business.
Ron: You know what is interesting about that? You know, if you think about it, when somebody is going through the yellow pages and they needed somebody, let us say water proofer or something. Then call the first phone number, get voicemail, so what did they do? They did not even voicemail message. They went to the second one and called. And basically, a lot of times, the first person that actually picks up gets the job.
Ron: And you can say the same thing with video conferencing. You are able to have a face to face meeting faster than anyone that does not have video conferencing. So the likelihood with that face to face meeting of closing that deal is much higher I am guessing.
Jim: Oh. Here is a good perfect example. What you just said reminded me of an appointment I had in Columbus, Ohio with a potential client.
I was not going to drive down there. Now 8 or 9 years ago, I would have. But now with the mobile app, I am not going to drive. So I said, “Let us set up a meeting.” I have sent the client the link to our server. He downloaded the app which is a free app and our model. And I gave him credentials to get in the room which is simply his name and a 5-digit number and we connected. And we had a face to face meeting. I was able to show him schematics. I was able to interview him. I was able to ask questions about their application and I emailed the proposal to them.
That is a huge savings. I will watch the whole day. I will love the whole day. Going back five years plus, back in time, I would have driven down because of that big of a project for us. And it works out just great. So I got for example, a salesman lending two ports from us on a monthly basis. Those are floating ports so that is like a port we are going anywhere because in our model, the app is always free. So you can go to the Apple store and download the app there if you got an iPad or a Mac. You could connect on a PC. You just send the potential client an email. They click on the link to the server, it downloads the app and put in their name and you are connected. Done.
We sell of course the hardware that enables you to do that and our clients have the option of owning that or using a hosted solution or a cloud based solution where you pay monthly or by the month. So either way, we can help people connect.
I think salespeople. . .
Ron: Tell me more about how it is going to impact the salesperson. Regardless of which, whether it is your solution or another solution, how is video better than other solutions?
Jim: Well, this is a push back I get from salespeople. Well, it is not a face to face call. I could not disagree more. It is not only a face to face call. It is an in-your-face call.
And, if I was not in the business today and I knew about it, I would have two ports. I would be making my calls on video anyway if that was selling nuts and bolts, copy machines. You name it. I would be the one to do that on video. 10 years away.
It is just so much easier for the prospect. Alright, they don’t have to go the lobby. They don’t have to. . . It is actually easier to make appointments on video than to make appointments physically. It is just much easier. It is less, I would say, threatening to the customer. And now, because of smoother carriers, well I can’t wait to see how they do this. And then you connect.
With things like, you did mention Skype; I mean Skype is great for us because what it did is it created an interest in the technology. But Skype does not work very well in the enterprise. It is really unreliable.
It is really good for visiting your girlfriend, or your son or daughter in college. It is wonderful. You could communicate to the world. The problem with it is it is in a silo, it is not in a standard.
In the video conferencing, everything needs to be on a standard. And that is where it is going to impact sales because it would be like, you have a Verizon phone or a cell phone with a Verizon, and me having one with AT&T and we cannot connect, that is ridiculous. I don’t want to have that headache. I just want your number.
In the video world, it is the same way. Everything is on a standard. You are going to see like the WebEx and the goto meetings and all these. They are great and they do great with web conferencing. They do, but there is a huge flaw. The huge flaw is you are in a silo. You cannot communicate with each other. There is none on a standard.
So we feel over time, the video world is going to just overwhelm everything and everything is going to go to that standard or it is just not going to exist. For example, there is a lot of companies out there bridging Skype with the standard. They are bridging FaceTime with the standard, everything. They have got always bridge services and whole set of services that will connect.
The problem with that is, sometimes you are building the tower of Babel and you cannot collaborate. There are lot of things you cannot do that need to be done in the enterprise world. So you are going to see a big push from business column. You know, “We want the standard and we want things that work seamlessly at all time forms.”
So this is all going to affect sales. Just like email affected sales. Just like cell phone affected sales. Just like company cars affected sales. It is going to have a really huge impact in a positive one.
If you have a sales force in a company using video conferencing versus a company that did not, the first company will have a huge advantage over the competitor, a tremendous advantage. They would be taking a gun to a night fight.
Ron: You know, you brought up a good point. You used the cell phones and also email. It would be like somebody with a Yahoo email cannot email somebody with a Gmail email.
Ron: Whoever your provider is, you are stuck with them. So, it is interesting. . .
Jim: That is a perfect analogy.
Ron: It is interesting that they just do not have one like . . . You cannot use whatever client software you want but as you collaborate with any other one that uses the same standards, I cannot believe that is not more probable in video conferencing. When do you think it is going to happen where it is all like standards-based 100%? Like anyone who is not on the standard is just gone.
Jim: I think that will happen probably, well within 5 years. That is my prediction. You cannot fight it. They have got de facto standards and de facto standard, when everything was ISBN with H320. Now the de facto standard is H323 and SIP. Now in voice over IP (VOIP), that is all SIP. In the video world, it is H323. We own 3 public rooms.
A public room is a board room that you can rent and you can meet anybody anywhere in the world in another board room at light speed. The rents on these rooms either go for $229 an hour up to more than $500 in the international market.
Jim: If you have a WebEx account, if you have a GoToMeeting account, you have got yourself off of 10,000 public rooms across the world. You are not going to be able to communicate with them. You just cannot unless you go through a bridging service and then it gets expensive, it gets cumbersome, and then you may or may not be able to collaborate.
So when you have that amount in the public domain up and running and working and we own three of those rooms and you are not on a standard, you can go out of business. End of story.
So over time, I if say to you well gees, go get a GoToMeeting account, okay fine. I want to interview a job candidate in Singapore; you cannot go to a public room. You do not have the access.
So, that is where there is going to be more and more pressure. People are going to want to be able to communicate seamlessly on a standard just like my client did when they closed that big account. There was no headache at all. All they had I asked them if they got video conferencing, if it is IP-based, and they go, “Yes.” All they need from there was the number and they called it. They did not care what equipment they had, what service they had, it did not matter. It may not have been hardware. It could have been a soft codec or a soft system on a computer that has static IP address.
So, that is where we are at. And it is going to head there quicker than we think.
Ron: It sounds like it is good news quite frankly. And I think that is probably one of the things that stop some people from jumping in. I mean, I think about how long it took me to buy my first big screen TV because I was confused by which kind I wanted and it just seems to complex for me. So, if it is a standard, it just makes the decision buying simpler because everything is going to work together.
Jim: Absolutely. And it is seamless. Now, there is one company that we work with, we were good with a lot of variety of manufacturers and then they are all really good. People said who makes the best. And that is hard to tell. I mean they all did such a really good job. The technology only works as good as the network. The network is the railroad track. And if the railroad track is bad, video conferencing is going to be bad no matter what equipment you have.
So, I told clients “Get a good network.” My mobile app, I got a 4G router so I have my briefcase with my iPad if I have to do a video conference and I just boot up the 4G router. If the network where I am at is bad, and I know I am going to get good high definition clear signal on that 4G router and have a seamless connection.
So, as it gets easier to use, it is going to get more practical. People are going to demand it. On the client side, they are going to want more visitors coming in on video. The things was Skype, again it is great for business because it gets people interested in the technology. It falls short when you get into the enterprise. In fact I would say most of our client use Skype or I had use it at one time and then we got a call saying, “Well, we are going to do this. We are going to do that. We got critical meetings. We cannot be cut off.” And then it migrates to our stuff.
Ron: That was really getting into our last question. I mean, when should I be using Skype. Obviously if it is family and it does not matter if I am cut off and stuff. And what point do I move to something like GoToMeeting or something like that? And when it is the right time for me to really say, “We are to decide, we have the budget for video conferencing.” Tell me how to make these decisions when I am thinking about getting into this.
Jim: Well, I think the time to use Skype and the place to use it is at home because it is free. So the time to use Skype is when you do not want to pay and you are just using it for consumer use or home use. That is when to use it.
The time to, in business, is if you have critical meetings, if you have key account meetings, if you have meetings with a supply chain, if you have meetings with partners with the businesses that you need to get into an enterprise solution. Something that is a) secured, b) working on the standards, and c) the ability to do, what you need to do is to collaborate.
So, I would say that the time to use cloud-based, professional enterprise video conferencing or purchase the hardware, either one, is now. If you are having those meetings, you need to have that in place now. If you do not have the budget, that is okay. Get a hosting solution. In fact, I am a big believer in starting out with hosting first before you buy it. Get the culture used to using it. And get people . . .
And your thing is, who you buy it from? I tell my customers all the time. I said, “Look, if someone is calling on you to sell you video conferencing technology and they do not have a public video number on their business card and/or a server location they can go to download the app, do not buy from them.” They do not believe in the technology. We do. We have our numbers on our card. People could call us any time. We are using the technology and we are using it now.
So, the time to start using the technology is right now. In fact, as soon as possible. The time to buy? You do not have to buy now. Use it now. Buy it later when the budget accommodates a little more. We could demonstrate a return on investment. It also determines are you going to be in a board room. If you going to be in a board room, you probably have to buy some hardware along the way. The Pan Tilt Zoom cameras that will cover the whole room.
If it is a conference room, you can get a totally self-contained system that is really simple to use. You connect with two buttons and you are on a video call. So, I do not know if I made it more confusing after answering your question but I think the time to use the technology could be as soon as possible. And you do not have to buy anything. That is the beauty of it.
Ron: Basically, and we are doing this interview, people are really welcome to contact you either email, phone call setup, a video conference 00:26:30 on action, right? You will meet with people. . .
Ron: See if it is right for them or not.
Jim: See if it is right for them or not. The first thing I tell the audience is to go to our website which is www.jwhornvideoconference.com. That is www.jwhornvideoconference.com. It is really a neat website. We run two article weekly on it and it is really an 00:26:57 for clients or potential clients that are considering video conferencing and it answers a lot of the questions you asked me in the interview: when to buy it, when to get, how to think about an application.
And on there, we have our phone number and you can call us anytime at 330-677-5566. Again our phone number is 330-677-5566. We are delighted to talk about the technology and your application.
Ron: I appreciate your time, Jim. I think it was really helpful. It is just really critical not to ignore this until you are one of the last people in your industry not to have it. Because, it does give the people with it a head start. Correct?
Jim: Yes. We are a critical mass. But the thing that is driving the critical mass or everybody really needs it. And I got customer saying, “Hey, we want it.” And I go, “Why?” And they go, “We do not know. We just think we need to have it.”
It is delightful news for our salespeople but the thing that really pushed it over is the standard which is the IP standard on the network. It went from going to the telephone company going to our network and onto a circuit and that technical lead made it really connect and really inexpensive to connect. The flood gates have been opened. It is just a matter of time before we all have it
Ron: Cool! I am looking forward to that.
Jim: It will make that lives easier.
Ron: Yeah. Okay, I appreciate you coming on our show today. And I look forward to talking to you really soon. Thanks a lot.
Jim: Thanks for the opportunity.
Ron: No problem. Bye.