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Enterprise Sales — 101

Recently, Jyothi Bansal published an extremely interesting post titled “Science of Enterprise Software Sales”, where he writes about the journey and the process behind building a world class sales organization. Its a must read for anyone in sales, even more so if run an enterprise software company.

This post is targeted at the enterprise sales rep, based on my 13+ years of enterprise sales experience.

I’ve had the privilege of being the first sales hire at a couple of startups so far in my life [ I was the first sales hire at Capillarytech prior to Qubole ] and have worked with some of the best people in the business. Having spent over 10+ years in enterprise SaaS sales, I wanted to put down my thoughts on what an individual sales rep could do to become successful.

This post is mostly my reflection as the first enterprise sales rep for the APAC market for Qubole, and to set expectations for many others who want to take a jump from being a sales professional at an established company into the startup world. Also, if you are part of a startup sales team but remote, this post can help you prioritise and focus on efforts that can help you become successful.

For someone who wants to get into sales — you might want to check my earlier post on how Sales can be a great life Skill.

Additionally, this could also help help first time founders to help identify the right kind of first sales hire who could potentially become a great sales leader for the company.

Setting Expectations — The founders are typically the first sales people in the company, but once they have a reasonable set of customers (about 20 in my opinion), it’s time to Hire a dedicated person who can step it up and focus on sales only.

Be Hungry: Don’t be foolish.

Don’t expect Spoon feeding. Understand everything about the business.

Unlike large companies, where there is a dedicated plan for Onboarding, early stage companies cannot afford that luxury. In startups, there is no spoon feeding, don’t expect your boss or anyone else come to you to give you info that you need. One needs to be proactive and must know how to get information that will help you make yourself successful.

When I joined Qubole, I had very little knowledge about the Bigdata landscape but thanks to the brilliant engineers at Qubole and spending countless hours in asking questions, I was able to understand the product, underlying technology and also articulate, why anyone with large amounts of data on the cloud should care about Qubole.

Being the first sales hire, you don’t start with a playbook, you have to build a playbook that works for yourself.You have to close very fast, very frequently. You can only do that if you have answers to all the below questions.

1. Identifying the key personas of people who have the pain point

2. Quantify the pain point or the benefit

3. Create need

4. Create urgency

Small consistent steps, leads to big changes in your pipeline.

In my opinion, the best sales professionals have three things in common

1. They are great listeners

2. They are curious and always ask the right kind of questions.

3. They are Disciplined

When you are part of a remote sales team and you are on your own, you don’t have the luxury of learning from your peers or distributing work to other functions.The best way to learn how to sell is by selling.

Unless you are out in the field and talking to prospects and customers, you can never start. Cold calling / emailing is an effective way to gauge how well prepared you are. Sending emails that get you a response is an art and you will get there only after going through the pain.

Protip: writing emails that get noticed.

i. Be Personal and convey why that person should care.

ii. Asking a question usually helps, it brings a certain amount of authencity in wanting to understand more about how they solve a “particular problem” people have in similar industries

iii. Highlight the single most important thing your company is known for and why you should care.

iv. Always talk about low bar to enter, highlight potential risks of non action.

Doing this consistently, I was able to build a pipeline and the next part was to create opportunities from interest.

Un-qualify

The larger the pipeline, the better right. Partly correct. A better way to build is to narrow down the criterion for a prospective customer so you can focus on. While its important to go wide in the quest of an opportunity, its even more important to ask enough to weed out the ones where there is no opportunity for that quarter.

As much as qualification is an important process, quick Unqualificaton is even more important.

At Qubole — We had 5 questions that we asked in the first call that helped us identify whether or not there was an opportunity. The 5 questions helped us qualify the lead (incoming or self created) — It also saved enormous amount of time for us at events / conferences. Yes, to all questions meant that the opportunity was super-hot.

Qubole platform is used by Data Scientists, Data Analysts and Engineers and allowed people with no skills in Bigdata to implement Bigdata in production. It democratized access to data which in English means — Qubole allowed Analysts (with only SQL skill sets) to write queries against massive amounts of data, which was earlier possible only if you  invested heavily in building a bigdata platform in-house or via a vendor.

Try before you buy — Always have a well-defined Proof of Concept / Paid Pilot to make it easy for your customer to decide, but make sure you are in control of the PoC.

It’s very important to define.

i. Expected outcome of the PoC (what is termed as success or failure).

ii. Expected outcome in what timeline.

iii. Who are responsible to sign off for the expected outcome in that timeline?

iv. Assuming it goes well — what is the next step? Who need to be involved and what does it take for that process to happen in parallel ( eg: Legal review, security review

We had 100% closure rate from this step onwards.

Again, highlighting the importance of Unqualificaton as it allowed us to spend enough time on the ones where the probability of closing was a lot higher.

The Close

Your job is not done until the signed document and money in the bank. Right from your first cold email to your followups to the PoC, this is what you have been waiting for.

What’s the cost of getting a Bigdata project into production 3 months earlier than their original date?

This helped us to close the deal as soon as the PoC was done. Keeping a pay as you go model meant that customers always realize the value before they pay –Which was completely opposite for competition.

Pro Tip — De-Risk the deal from the people.

If your talking to only one person in the company and the success of the deal depends on this one person (even if the person is the CEO), the deal at risk.

Get multiple people who are critical for the success of the project (project = deal to be signed) involved. Never talk to just one person in the company.

If you are doing a PoC, get the contracts vetted by the prospects legal team for identifying potential red-lines, you don’t want this to start after the PoC is done. Most legal teams take 7–10 days to get back and they don’t care about your Month end or a Quarter end quotas.

Bad News Early — One of the things I learnt very well and learnt the hard way was to convey Bad news early in the cycle. This allowed me to set expectations with my management well and seek help when people can actually help and not at the last minute when nobody can help you even if they wanted to.

This is not an exhaustive list but a few things that helped me, to hit my numbers quarter on quarter in a completely new market, where we did not have a brand name, where we had to work on creating the need and urgency.

Quit to start again.

After laying the foundation for Qubole Sales outside of US and building a million dollar business under 15 months, I quit to start Fyle along with my longtime friend and co-worker at Qubole, Siva Narayanan.

Its also a great feeling when your former boss blesses your new venture by being an angel.

Thanks Joydeep Sen Sarma, Marcy Campbell, Ashish Thusoo for an incredible opportunity !

Guest Post by Yashwanth Madhusudan, Fyle.

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Scaling Revenue Roundtable

Enterprise Sales, Marketing & Inside Sales Team Build Out, First International Customers Acquisition, Enterprise Pricing etc. I understand, we have heard these topics in multiple events & conferences, so why this round table be different? The difference is gyan vs hearing from real person with real experience which sometimes exactly what you want to hear, even reading 10 books will not help compared to one line coming from a CEO who has done it over and over again and seen the success.

AiAfOYoopNK2-JpnERWxOZdUFD5vPYd5ajC8OOkJg_tPIn this Round table, Aneesh was leading and moderating the discussion. He leveraged the experience of other founders which made the most out of few hrs of interaction. The participants are founders of mid-stage startups, who have good-size customers and have decent ARR (Annual Recurring Revenue), growing and scaling.

This blog narrates the learning in the form of Q&A.

How to establish a meaningful and sustaining Partnership for your B2B enterprise business and grow your business?

  • Partner are those who have done similar product sales in medium/large scale before, so ask them for their sales targets (region wise) and their profile of B2B partnership in their existing set up. That is a good validation point for partnership. {It is like validating by their current and past experience in partnership}
  • Partners could be the companies who are into services (in your industry vertical like healthcare or retail etc) and likes to have monthly revenues.
  • If your product sit on top of other product and integrates then go for a partnership program to the base product. For instance, if your product complements or built on top of Salesforce, then you can enroll in Salesforce has AppExchange program wherein you can list your product and generate good visibility and leads. Partners, could be the product that your software compliments or built upon it.
  • Partners could be the implementation companies of the product that your product built on or compliment. Say your software built on Salesforce, then the service companies who are implementing Salesforce solution could be your partners.
  • You could also go for two-way partnership, like I push your product and you push mine, sometimes one partner performs a lot better than the other, in that case, be open and refine the terms as you go in the journey.
  • If you are enrolling in partnership programs from large companies like IBM, Salesforce etc and see if you can use their promotion events and brand your product, many gives a free offer for promotion. You might end up in getting leads worth a lot that might seems impossible to generate by the solo marketing you do on your own.  These large companies also have paid outreach which has high outreach and see if it is worth investing.
  • Incubator and Accelerator, if you are part of any incubation center or accelerator that helps a lot in getting the right partnership e.g  Microsoft accelerator
  • How to bring transparency in partnership? You might also want to try “Lead Protection Program” which creates 100% transparency in the leads generated, let your partners enter the leads in your CRM & both of you can track the status and you can also make sure that right analytics are coming out.
  • If the partners are asking for exclusivity, ask for minimum guarantee e.g 30 qualified leads per quarter per area
  • Partnership takes time to achieve, so keep experimenting, be conservative and go slow, do a some sort of pilot before you sign larger partnership contract. And ready to fail as it takes time to get into right partnership.

AtT1H_5g3UkqxqIvC6jRlOknnwXUZPnMjQ0GkhyzAymFHow to acquire customers in new international market?

  • You can go with the existing customers and if they have business overseas then you can approach them for the initial open door to international market.
  • Another suggestion is to participate in events and have a booth or something so your product gets exposure and you might end-up in getting partners or customers
  • LinkedIn is a great source to find first few pilot customers in that region.
  • Overseas partnership also you can explore using LinkedIn or Quora, but it is not that easy to find viable partnership
  • And also cold calling for opening doors also worked for few startups.
  • If your product is like B2C then publishing in appstore, Appstore marketing, google adwords would be a good start, but if you are in B2B and enterprise sales, then the steps mentioned in the beginning are the way to go.
  • Once you have handful of customers internationally, select a country where you could open a small sales team may be start with one or two guys and these guys need not be very senior like VP level, 2 yrs to 5 yrs exp and they have to work with India Sales team parallaly. You might need to travel and stay there for a while for initial years to establish a sales pattern oversees.

Ar3dOzl_O6w-FGfJzAg_J7VarpANJbdP-uJ4bFiora6FHow is to do pricing for your product?

  • See your competitor price and product features and how much it solves the customer problem, how your product makes them dependable, this combination will help you to arrive at pricing.
  • If your product a lot better than your competitor, do not lower your price to compete, you need to stay at a price tag for the right product.
  • If your product does not have India based competitor, see the US pricing and create some kind of benchmark value to arrive your pricing.
  • You can have different packaging but not too many, max 3 to 4.
  • You kind of have to experiment with pricing, for e.g one of the enterprise product was priced it 5k for the first few customer during pilot (initial years) and when they need to sell the product in the second year to a bigger organization, they tried quoting 1L and end up in selling at 60k.  So you need to try and see how market is reacting for your new pricing, first few year keep experimenting, you will be able to arrive at pricing between 1 to 3 yrs if not before.
  • When you sell enterprise product, make the price attractive in the pilot stage and after showing the desired results, you can go for high price and the customers would not mind paying it as they have seen the results which impacted their top line.
  • The pricing could be geography based and can be different. And again, find the right pricing by seeing your competitor and demand in that market.
  • If you want to give freemium version, give it free but let the customer give you some kind of asset that you can use for your business like marketing or brand building. For e.g refer 2 friends to get the free version or share in your facebook page to get the access. Some kind of exchange of benefits for freemium version.

What is the most painful growth in the entire journey of the startup?

  • 1M to 5M growth is the most painful where you are likely to make mistakes
  • While growing fast, you need to be careful when reaching to new markets, not all regions works great for your product. US need not be the best market for all products. If you have invested in one region and seems like it is not working, then shutdown and alternate your sales strategy in overseas.
  • Please refer “acquiring customers in new international market” for more details.

How to upsell and cross-sell to your existing customers?

  • There are two ways, first upsell more apps/ additional features to the same customer
  • Second is find out other departments or other sister organization and do a cross sell
  • An customer account is usually handled by an account manager, the upsell/cross sell need be done by different person say group account manager.
  • Every group account manager handles multiple accounts, like 5 to 10 accounts, is responsible for upselling. The account manager finds opportunities for upsell. Do not mix up the account manager dealing with customer on day-to-day basis to do upsell as the negotiation will become very tricky otherwise.

How to give discounts to the customers in SaaS product?

  • The discounts needs to be distributed, do not give them at one go.
  • For instance, do a yearly subscription with 2 months off. Those two months are going to be 11th and 12th month. So incase they leave in 6 months, these discounts does not qualify.
  • Another way you could spread across 3 years like 3rd month, 6th month off, 22th month off for discounts.

How much is the typical yearly renewal increase in ARR for the Enterprise Product?

  • 8 to 10%
  • We need to say 10% increase is very common and if the customer creeps, bring down to 8%

How to get testimonials and referrals?

  • Usually testimonials are done after building a strong relationship with a customer. Usually after 1 or 2 years. Make sure that the account managers and CXO’s of the company has a good relation built with customers to ask for testimonials. Once you establish those soft links, whenever the customer delightness go very high and initiate the process. e.g Release of product feature which solves one of their pain point which the customer demanded for a while.
  • Another idea is to mention this in the subscription or contract time itself. Suppose if the customer is asking for discounts then you can tell him that you can enroll in the “Loyalty Program”  in which you might have to give testimonial & also give 2 referrals and participate in the case study within the first 2 years and you are eligible for this much discounts. This way the customer is well aware of the expectation and also enjoys discounts. Do not give discounts for free, make him have some benefits offered to us.

Does awards and recognizing important for startup?

  • This comes directly into credibility building so it is good to get some recognition
  • The important point is apply for recognition that are credible and genuine with a selection process like boot up awards by ispirit
  • Have some sort of recognition award or have an article or mention in international news & media like Techcrunch, Harvard Business Review, Gartner, Marketing Magazine, Forbes, Wall Street Journal etc.This will help both India & international brand building.
  • You can use a PR agency to reach out these media and appear for the competition or for the product review

Name some books good for Inside Sales and for Complete Sales?

  • Predictable Revenue by Aaron Ross
  • Sales Acceleration formula by Mark Roberge

Is there any online tests used as a first-cut of sales roles?

AkKzIBAt4w99IJ_Uj2_8mQGs0EyU9dnA03l9hY6xQA1qHow to provide incentives for your IS(Inside sales) team?

  • Incentive are always a motivating factor for the Inside Sales team. We have laid out some numbers as a sample for you to see below.
    • 2% to 3% of Annual Recurring  Revenue(ARR) for new customer acquisition.
    • 2% to 2.5% of annual revenue for UpSell/Cross Sell or  have a fixed amount like 10k for all revenue of 3L to 5L per year, 5K for 2L to 3L etc.
    • You can also say, if you get a referral from a customer then the account manager gets 5% of revenue.
    • You can also include testimonial incentives for e.g Video testimonials 10k, Text testimonial 5k, Case Study like 10% of ARR
  • Even you can add some incentive for first go-live means successful deployment and this is applicable for enterprise products
  • Make sure these numbers are published and you make sure the check is given to him as soon as you receive them from the customer.

We would be writing another blog on a related & demanding topic “How to set up a Inside Sales Team from scratch & generates Leads?” in the upcoming week.Stay Tuned and Happy Reading!

Contributed by Asha Satapathy, DocEngage

 

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The little Spark with great promise – Inaugural #PNMeetup on Pricing for Enterprise Sales

When a bunch (around 45-50, I didn’t keep the count) of Product enthusiasts – with experience accumulating into decades – gather at a single place to share their learning on specific topic in a compact & well-moderated session of 2 hours, it’s worth every bit. That’s how I felt coming out of the inaugural session of #PNMeetup – Pricing for Enterprise Sales: Specific & Important Topic, Quality Participation, Richness of Experiences, and Quality Conversations.

The location, Hauz Khas Village in New Delhi, carries a constant buzz and energy. Very apt for a meet-up like this. Kunzum Travel Café (Thanks for being a great host for the event!), should be happy because participants used up every nook & corner of the place. Many of us had to settle down on the carpet with no more sitting or standing space left! Of course, the snacks & coffee was great too. But, that’s not what everyone coming in was specifically looking for (especially since the last 500 yards got harder to make with the traffic and parking situation ;-)).

We were looking for some great (practical, experience based, relevant) conversations and takeaways on Pricing. And, there was plenty of it, coming from speakers as well as from the participants. As much as is possible in 2 hours of time, that is, also thanks to some great moderating & counter-questioning by Arvind Jha during speaker sessions, and Rajat Garg & Vivek Agarwal in the un-conference session.

Tushar Bhatia, Founder of Saigun Technologies, set the tone for Enterprise Products Pricing by sharing his experiences on Pricing Strategies and Sales tactics. Tushar emphasized that Pricing is not a linear decision, but a complex process and subject to assessment from multiple parameters. He also differentiated the Pricing Strategy from Sales Process. Pricing, as per him (in the context set of Business Planning, Scalability, Consistency, Standardization, and a reflection of the Value Proposition) is a guide at broader level, while on sales tactics front, one should be willing to consider the customer & geographic circumstances as well. The decision matrix for Pricing decisions typically is pretty complex, and a product undergoes multiple iterations of pricing models

Pricing for Enterprise Sales
Pricing for Enterprise Sales – Tushar

before arriving at the sweet spot. However, various types of customers may need to be assessed in their own contexts when deciding on a deal pricing, especially in the traditional Enterprise Sales scenario.

Tushar also emphasized that the Enterprise Licensing deals should consider not only the product pricing, but also the other costs (such as, hardware) and provisions (such as, for Product Support). The considerations on TCO are critical, because the customers assess the products, not only functionally, but also very critically from an operational viability perspective in longer term. Tushar also laid out few questions that need to be answered while deciding the pricing model. The detailed presentation from Tushar on “Pricing for Enterprise Sales” can be found here.

The discussion, then, veered towards the product pricing strategies in areas such as Telcos, serving also as a cue for Tarun Anand (CTO & Co-founder at Semusi) to pitch in and provide his perspective. He shared his experiences in working with the big Telcos on working out product strategies and pricing models. They tried out various pricing models, in partnership with Telcos especially, and had mixed results over time before arriving at something that seemed to work. However, pricing remains a volatile when dealing with the larger partners and in more complex ecosystems, such as Telcos.

In Tarun’s experience, one needs to ascertain that the partners in the ecosystem are ready to take your product to the market if that is the expectation. It is also important to ensure that the pricing terms & conditions are clear, and you are able to hold the customers as well as partners accountable in the operational limits as much as you can. After all, you want to focus on running the business and do not want complications of financial & legal nature. In the context of Pricing and products strategy, in areas such as VAS, as per Tarun, one needs to be very careful. “VAS is dead” in his words! 🙂

Tarun also emphasized “there are takers for product at ANY price point”. One need to clearly understand whom one wants to target, and also understand that it’s not only a question of moving the pricing point up & down in inverse proportionality with the volume of customer base. There are various triggers for the pricing, one of which is the “premium value perception”, and also the fact that once you move into a market with a particular price point, increasing it later on is almost impossible without hurting your customer base and overall strategy.

App Pricing Tactics
App Pricing Tactics – Prashant

The heat in the Mobile Apps makes the App Pricing a very sought after topic, and that’s where Prashant Singh (Co-founder at Signals) came in and provided a good framework for the high level App pricing approach. There are two clear distinct possibilities – Free & Paid. Complete Free, as per Prashant, directly leads to an Ad based model for revenue that shouldn’t be a preferred model as such for most app developers. In fact the question is not whether to go Free or Paid. Question is when is the user ready for monetization. “You hit when the iron is hot, as simple as that”, Prashant says.

Prashant provided a high level framework to judge which approach should be adopted by the App Developers, based on the two parameters: “App Life Span” and “Time to Realization of Value”. Based on a combination of the two, one can decide on the high level strategy (Portfolio/Platform/Utility/Device Embedding/Brand Apps…) and Pricing model (Advertisement, Paid, Transaction based, Freemium, Development level, and so on). Check out this presentation – App Pricing Tactics for more details.

One key point that drew interest was around the Price Point for App at the launch time. Contrary to the normal belief, Prashant says, one needs to launch the app at a price point that is higher than the Median price point for the App store. That provides the App Store an incentive to showcase the App, and it is important since App Stores control the downloads more than the “content” or “quality”, at least until critical mass. Growth Curve of the app can be maintained around Median and depending on the value prop of the App, the baseline pricing can be used at sustenance phase. Another strong point of view from Prashant came around the Advertisement model, which as per him is the last to be considered. And if Ad model is considered, his advice is to “not” let the control away – “Always have your server in loop”.

While all the content and discussion, and few laughs in between, served well to our appetites, snacks were served amidst a quick “Unconference” session moderated by Rajat and Vivek. We discussed and debated on some great points. I’m finding it harder to capture every bit here and I don’t want to be partial to only what I remember right now! I hope that if you attended and are reading this, you would be able to add your takeaways in comments section! 🙂

Overall, I had a great time. The highlight of the session, for me at least, was the richness of experience and passion for products. And I met some really cool folks! Many of us hung out until later in the night and continued the conversations, which is a great sign. A small impetus can go a long way, and I’m very excited that Avinash has triggered this spark that all of us as a community have to fuel into a passionate ecosystem around products. Great initiative, ProductNation! Looking forward to the next edition on Jan 19th 2013!

PS 1: And, there was a cake-cutting for Avinash on his Birthday! Great gesture!

PS 2: Some Tweets from the session!