How to sell a B2B product
calv.info
calv.info
I think many executives / entrepreneurs have developed a similar adversity towards incoming offers, and my own experience with cold outbound selling seems to confirm this. I’ve contacted hundreds of companies myself trying to sell our service, but the only deals we closed so far were either with companies we already knew via our network or ones that did actively seek out our services themselves. It’s of course possible that an experienced sales person would be able to generate outbound interest, but as a founder without much sales experience it is very tough. I therefore think inbound sales is the future, at least in B2B.
In general, I think it’s better for a technology provider to partner with organizations to handle this tough enterprise sales process than to do it yourselves, but it depends upon your market and organization (we’re a database provider).
This article wouldn’t disagree with you. When you’re building the product the trick is to build your product almost alongside your first customers - invite them in and show them Figma mockups and ask what would provide them value, and bring them on the journey with you. Come with a compelling enough value proposition and solve for a large enough pain point and you’ll absolutely get executives of at least SMEs on calls.
Once you have that first customer, the outbound motion becomes a lot easier as you have references. It’s easy to fall into an ‘if you build it they will come’ attitude with inbound sales. In truth it rarely works on its own. (Work in sales / marketing for a large vertical SaaS)
I agree with you up to a point. Real customer use cases are important and good references are gold--both for getting other customers and for getting onto some analyst radars. However, it's important not to pivot towards building what a customer wants so much that you basically end up being a consulting company doing a bunch of one offs. (Assuming that's not what you want of course.)
Usually by the time you've done 3 or 4 calls with customers in a good target segment, you start to hear some common themes again and again. As you say though, you have to avoid the temptation to wrap yourself around the weird edge cases of one customer (especially if that customer is a 'big fish').
I also 100% disagree.
Inbound is a waiting game. Referrals are a waiting game. And hoping to be found at the right time by the right buyers ENOUGH times puts external factorsnin charge of your business but just thriving, but surviving.
My business exists precisely because we believe so strongly in outbound as a strategy. But wherein you are right that random cold outreach is distracting and a waste of time, outbounding that is targeted well and focused on problem solving can be the best ROI you have all year.
The difference, we have found, is between prospects who are aware their businesses are imperfect AND are curious about solving problems and prospects who know their businesses are imperfect and willing to live with those imperfections until such time they become intolerable. Those that choose the status quo until such time that they choose to go looking, as you have self-identified.
Candidly, there are a lot more of the latter than former but there are still plenty of the former.
Do you have a good strategy for identifying open-minded companies that are willing to learn about new approaches?
> Do you have a good strategy for identifying open-minded companies that are willing to learn about new approaches?
The answer to both your questions is segmentation, segmentation, segmentation.
The trick with segmentation is to find clusters of companies who are likely to share like-minded problems, hone your messaging and positioning to reach them (Basecamp is a classic example of how to do this well, they have always had a very clear idea of who Basecamp is for and who it is not for), and then identify the _individuals_ within those organizations who are most open to change.
Again, the temptation is to head straight to the C-suite - this is usually a bad place to start. C-suites are time poor, usually quite cynical about new software, and removed from the problems of the people on the front line. Usually better to start in middle-management with PMs, and arm them to build a business case to take further up the org.
Who in the org is incentivized to solve the problem your tool or software solves?
And tbh, the majority of sales I've ever made were from outbound. Usually very targeted outbound where I had the prospect more/less pre-qualified (after talking to lots of prospects you develop an instinct)
Been in business for 8 years, dev turned sales
If you're the type who likes learning new things, you'll like both. It's a new and valuable skill set that applies to other areas of life. Even if you're not an extrovert (I am certainly not), you find a style that works.
Several times I've been able to build and automate things that helped me do some very creative sales work. So having two skill sets was big.
So to answer the question, I like both and maintain interests in both.
I am at the receiving side of them, with currently no way to escape. (Ouch!) But well, the strategies I see them using are:
1 - If you see some large change on society (laws, tech, etc), focus on solving the problem those bring. That way, everybody will have the same problem at the same time, and you can pitch for it.
2 - Keep in contact until they need it. Maybe even try to help your possible clients in solving the problems that make your tool "not our largest problem today".
3 - Have a portfolio. Discover what problems the client has first, so you can decide what to sell second.
That said, I still didn't buy nor have seen anybody buy anything from a company that approached us first. As I said, those are techniques I see the experienced sales people using. I didn't see them working, but I assume sometimes they do, otherwise those people wouldn't have a job. Also, all of them look very expensive in some way.
It just seems hard to believe that cold outreach won't work for SaaS
As I said I think if you can hire a professional sales team they will make it work, but that usually takes one year and costs a signficiant amount of money, so for an early stage startup it's often out of reach and very risky.
Unsolicited inbound requests go into the spam folder without looking.
Where things are getting bad now is with cold calls, LinkedIn, Twitter etc messages. There isn't a channel that salespeople aren't using. They'll come by the office or send you a letter. If they can't get to you directly they'll go to your subordinates or peers... It's neverending.
It's to the point where it's just exploiting the urge of business managers and leaders to not be jerks.
truth is the marketing works on a percentage of people, just like any other method.
I co-founded a bootstrapped B2B hardware startup and we are not salespeople. In the early days, we had mediocre prototypes and tried selling them by cold emailing prospective customers. We closed some deals but we were not happy with the outcome and we did not like doing it. So we completely stopped sales, put out some content and survived on contractors works. Eventually emails started coming in. We tried our best to help, even though it meant recommending a competitor. We missed sales but we were able to build a network of people who supported us. At some point, these people started requesting new products and now these products sell themselves.
I guess if one of us was experienced in sales, it would be a different story but if you are not a salesperson, focusing on the value you can bring is a sensible bet.
> In every case, a viable option for the customer will be to “do nothing”. They don’t have to buy your product, or any product for that matter. The best way to prove the case for your product is with your metrics. Doing nothing should be a very expensive option.
That fundamentally speaks for having a problem to solve and not a solution looking for a problem. I think this key distinction is a good sieve to filter out potential ideas especially if you're in the business of SaaS.
With these numbers, I’d stick with the accountant. They work. They are flexible. They can be easily replaced.
With a SaaS product, I have to worry about whether their product works, if they’ll be around in a few years, how they’ll safeguard my data, if they’ll try to lock me in and increase prices, and if they can adapt to my changing needs. This decision process, alone, could easily nullify the projected savings.
Also keep in mind she/ he has limited Bandwidth for new initiatives.
If the product/service you're selling has an obvious benefit / fast ROI (for instance your customer can rent/sell it for more to their own customers, or save huge amounts on their business process), it's pretty easy.
However if your product / service is just "nice to have" and "can save money / help sales on the long term" it's almost impossible to close the deal unless your product /service is so cheap as to not be a problem at all.
In enterprise/saas... you eventually always have a solution looking for a problem. You have a salesforce or whatnot, and you have to sell it.
But even if a small company is reaching to you, as a salesperson, this is your job to qualify the lead, and to not loose your time on a lead that has low chance of signing
Not showing the price on the website is one way to push people to contact you. You don't want people to decide on their own if they should buy your product, you have a big sales team to help them do that.
I've wrote about it here, if you are interested : https://blog.luap.info/why-most-saas-companies-cant-be-succe...
However when I'm looking at tools that can help my org, I'm definitely frustrated that there's no pricing mentioned in many offerings - clearly I have three tabs with three solutions open and I have no idea about the costs. I'm NOT emailing you because I as an engineer won't have the same interest in this idea tomorrow when you email me back (probably because tomorrow's Monday and I'm in sprint planning). These ideas just fizz out and I never get a chance to follow up because of this
Enterprise sales at 100k+/yr levels can take a lot of work by both sides to get to the finish line, at least until everything else is smooth, screening out inquiries like this saves everyone time.
An even better business would have a way to make you succeed early as a single dev with low interest, and grow to enterprise level.
But that is now building 2 products and a fancier business. Hard to do both at same time, esp. initially. Sometimes you are lucky -- Concept, $$$, etc. -- but probably not.
The target audience is companies that don't really care about the price, as long as it's in some vague order of magnitude they are used to paying for other things.
Also the price is usually not fixed if it's not listed. The answer to "how much is it" is implicitly "who's asking and what can you afford". I.e. it's negotiated, and negotiations are much easier when the buying side doesn't know what everyone else is paying.
For the big companies we're typically a crucial part of their business and they typically require several integrations and other specialized modules which have upkeep. So we charge a bit more for the software. On the other hand, they typically have a very high message volume so they get a decent message volume discount.
For smaller companies the software is typically a bit cheaper, but with a significantly higher per-message cost.
Then of course there's negotiation for each contract which would make "web prices" rather moot anyway. Maybe a company wants lower fixed cost but can accept a higher per-message cost, as messages are often directly linked to their revenue, or vice versa.
Lipstick on a pig in 99% of cases.
I've been a CEO, CDO, a consultant, a middle manager and an IC. Well functioning high output teams (in any sector of business) almost never need a new tool/service to provide value. On the flip side, poorly functioning teams are constantly chasing new tools and processes as fixes to their broken organizations. So the vast majority of sales are convincing broken organizations to buy organizational nudges.
The single place where I am consistently happy to spend money is on things that our organization cannot internally build that we need to scale immediately. In the long run though, I want to eliminate as many outside dependencies as possible, so my goal is to either absorb you or build processes and systems that replace your service.
High output teams benefit as much, if not more, from new tools/services than anyone else.
- Accounting is much more effective with an ERP
- Sales is much more effective with a CRM
- Engineering is much more effective with CI/CD
None of these things are necessary, but they make good people even better.
no engineering high output team needs a versioning tool ?
no designer high output team needs a design tool ?
High output teams always need several tools
The way I see it, a "high output team" usually knows all the tools in their respecive field, and knows 99% of them are trash and this fundamental thing has to change before a better tool becomes possible. Which in turn makes conversations with salesmen mostly pointless.
On the other hand not a "high output team" don't know exactly what they need and just chase hype.
I can personally say that when I first started knowing about snowflake it made so much sense it might be the perfect tool for my org, and a few weeks later when my boss said they're considering snowflake I immediately communicated my excitement. Tech like Snowflake fundamentally changed how data engineers work, and it's not a change you can just invent in-house as a SME. Unless you're a large corporation it's probably wise to keep a lookout for tools that could make your work more fun and efficient.
The question is if your team never wants to embrace the new for risk of it not working out or it's always excited to try out things that might make their life easier. That's an acceptable practice too, as long as there's some teams left to do the experiments, any saas worth its salt will become "standard" in your field that you too will embrace.
I manage a high-output team, and we _love_ Mode. Could we write our own connectors to our BI warehouse to extract tables into pandas and jerry-rig streamlit to make our own Mode? Eh, maybe. We actually did dumber versions of this in the past. But we can stay lean by not having to worry about all the stuff Mode worries about for us, like credentials, auto-updating, pushing to slack, setting up a python environment? Absolutely, as long as it makes financial sense.
Again, maybe we're just disagreeing about software being shitty 99% of the time vs just 80% of the time. But I think my point would be that it doesn't have to be a sophisticated tool to be a pain point.
The data suggests otherwise. Historically the industries which have the most broken and convoluted processes also have the lowest investment in technology.
Some examples of decisions I’ve made:
- IT/engineers won’t spend time building and maintaining email servers, we’ll spend $5/month/employee on G Suite and use their time on things that make our products more valuable
- We won’t outsource support even though that would dollar for dollar be more efficient, because understanding and building empathy for the customer is more important
- no we won’t spend money on email lists, but yes we will spend money on tools that allows our outbound sales team to more quickly determine prospects that fit our ideal customer profile
- bringing finance in-house much sooner than other people recommended because being more efficient at Accounts Receivable, Renewals, and thus cash flow allowed us to grow faster than we otherwise would have
- paying for a third party SSO solution for our products and instead using engineering time to build first class integrations between our products and complementary products, because having an artisanal SSO System doesn’t benefit our customers
My Dad told me something when I was little that stuck with me:
"You never see ads for broccoli"
Of course while that's not strictly true (weekly grocery flyer) his point was that, if you actually need something to survive you'll figure out how to get it without having to be sold to.
And if you don't know what you need to survive?
I don't see how there is any alternative to researching stuff first in order to know what you need, especially if we are talking about "efficiency" and "value" which are not rigorously quantifiable.
In-house email servers are not constrained by the time to build them, but rather by reputation/spam considerations. Sorry, but that's a lucky guess ;-)
> paying for a third party SSO solution for our products and instead using engineering time to build first class integrations between our products and complementary products, because having an artisanal SSO System doesn’t benefit our customers
That's one of vendorlockiest vendor lock out there, which is a very YOLO decision.
The idea that buying stuff is more efficient then building it yourself is at the cornerstone of the modern economic theory, but that's only a theory. In the wilds there's much, much more factors to consider then just comparing cost of building versus cost of buying.
Deciding what is core and should be in house and what is not is hard and it’s only partially a technology decision. It’s primarily a business/market decision and being able to do those is a mark of a good CTO.
- consulting
- running a brainstorming session with a third-party
- learning something I don't already know about x/y/z
- sharing sensitive info such as success metrics
Sometimes you really want a hands-off, transactional relationship, where the partner simply delivers what you paid for, no more, no less. I understand this approach might be very valuable for a certain kind, or stage, of company, but it won't be ideal for every enterprise.
Do you mind following up over email? I'm calvin at segment.
1. The user is not always the buyer. Many founders know who their users are, but may not know who really made the yes/no decision. The sales and marketing need to communicate value to the buyer just as much as (if not more than) to the user.
2. Buyers need to be convinced that your product will solve their most important business needs--their desired outcomes. Things such as lowering overhead or meeting compliance requirements. (Similar idea to "Job to Be Done.") That’s what your sales and marketing should primarily be about, with benefits, social proof, and other selling points as backup.
Simple in principle but it takes months of research, customer/prospect interviews, and experimentation to figure out your buyers' desired outcomes and how to talk about your product in a way that directly aligns with those.
(Slightly longer version of this: https://www.gkogan.co/blog/buyers/.)
Having an engineer or PdM take 1 hour per week to jump on sales calls and just listen is one of the best things they could be doing early on.
One question that occasionally pops into my mind is, what is the legality behind charging BigCo A $x and BigCo B $x + y?
Surely one wouldn't be able to do this with products (I'll sell this burger to you for $5 but this other person must pay $10 for it), so how is it justified in b2b especially if the feature sets are the same?
We finally embraced that we are not going to be the best at sales or "always be closing" but the things we are really good at are automation, experimenting, and iterating which has enabled us to talk with more prospects and slowly improve conversion rates. In non-sales speak that means we have more customers having more success on our platform which is awesome.
We honestly believe we are offering something powerful to our customers to change their lives. That belief doesn't put food on the table though and shameless sales tactics like cold emailing, LinkedIn messaging, Instagram DMing, etc DO. (though we are super respectful and won't hound anyone that isn't interested)
I have a friend who works for transamerica selling financial packages and recruiting other people to transamerica. His ability to talk to anyone anywhere is constantly amazing and embarrassing.
What's interesting is that if you do think what you are providing is actually useful or meaningful, then there is nothing shameless about promoting it directly to those that might get use from it. And you promote it to people where they are: in their inbox, DMs, LinkedIn, etc. (We actually get tremendous results by supplementing cold email with phone simply because people are so surprised that we went through the trouble to call. But that's a discussion for another time.)
All that is to say that reaching out to people that might benefit from what you offer isnt sleazy in the slightest and is a practice as old as time itself. They will let you know if they arent interested, usually by ignoring you. Doesnt mean you should stop or feel bad about it.
Best of luck to you.
HQ # are easy to find although navigating phone trees and gatekeepers is a job unto itself
Zoominfo and a few others are super expensive but have better data.
Google works better than you think. Sales navigator has some numbers.
We usually call when an email has been opened multiple times and get really good hit rates for demos when we actually reach the person (when talking about SAAS). Last week one of my guys used that to book demos with Disney, Sony, and NBC Universal at the VP level to demo enterprise marketing software.
This article is very fluff heavy and contains almost no actionable insights.
You just went full meta
God I wish I had knowledge in more domains.
You only need to have passion for a particular domain to then engage with people who share your passion and also have more experience in that field.
etc.
Step 2: Hire a big sales team.
Step 3: Be really good at marketing.
Not really. Unless the subscription is in tens of hundreds, that benefit-of-volume is not possible. Even more so when the solution involves bleeding edge stuff (AI/ML/real-time analytics etc). Easy to say, very very very hard to even achieve decent margins on such infrastructural cost. It's always a tradeoff between { feature-richness, time-to-market } and cost-efficient SaaS. Only the players who got a solid customer base would ever get to enjoy that privilege.
> Though it’s far down in the acronym, the identified pain is really where you should start with the customer. You should be able to answer in great detail why their life is currently painful, and how they handle the problems you solve today.
There's a slippery slope. Any "solution" won't help, in the era of "disruptive solutions". During the initial stages of industrial revolution, cities were scared of all the horseshit they thought they'd have to deal with. A 'con'sultant would've typically come up with an efficient way to dispose off all that manure into the sea. Only a mad scientist working on an automobile somewhere ended up solving that poop of a problem really. And in hindsight, every mildly lucky person would consider themselves "disruptive" without actually having to be one though. Such is our world! :D
[edit] just noticed that all comments in this thread that are critical of the narrative are voted down. one is fine, all of them?