"The competitor had done all this work by going around the organization, interviewing the stakeholders, putting together presentations and data dockets that addressed their needs. This was work that Richard would have had to do otherwise. Thus, the competitor had helped Richard help him!"
This can actually backfire if it's not done very carefully and tactfully. Reaching out to multiple people in the same organization can also make it appear that you are just blindly going fishing. Those people will triangulate, and they'll talk, and they'll compare notes. You'll need to make very sure that you've actually tailored your pitch and conversations to each of the people you're approaching.
If you're just sending the same, cold-intro email to different folks in the same company, they'll find that out pretty quickly, and you're dead in the water. By the same token, if you've been cultivating a relationship with Person X, and then you reach out to Person Y, Person X might feel that you've circumvented him, or gone over his head, and then you've bred some resentment with him. Instead, try this: if you've made decent headway with X, ask him if he thinks speaking to Y or Z would be a good idea. He may say yes, and actually give you the permission. He may even broker those introductions for you, provided he really believes in your pitch. Or he may point you in a more productive direction, with different people that hadn't occurred to you.
I'm not suggesting that the author is recommending a clumsy, cold approach to multiple parties. Nonetheless, I've seen it done so many times -- both on the buy side and sell side of consulting -- that I feel it bears mentioning. The general advice in the article is sound, but putting it into practice takes a fairly deft touch.
He does suggest you ask a few questions to the person you've developed a relationship with, including: "Who are the other individuals in your organization that you suggest I meet?".
I guess that works for this guy, but as someone in a big enterprise, I'd be really annoyed with a vendor that is venue shopping. An an outsider, you have no idea what the internal politics of the organization are. Getting blindsided because some salesman took my colleague to lunch is a great way to get a project derailed. (The conversation can shift to "how do we implement product x" instead of "how do we solve problem y")
The sales teams that I've worked with for years (as opposed to the sales teams that aren't around anymore) have something in common -- they focus on building a relationship, figuring out wtf is going on, and bringing solutions to the table.
Other anti-patterns:
- Hyper-aggressive (ie Oracle): Their mission is to be a pain in the ass and sell your CEO a bill of goods. Your relationship is by definition adversarial.
- Mistargeted (ie Dropbox): Friendly people call every now and again. They never answer my question ("Is Dropbox on a state procurement contract?"), and don't understand why the answer they don't know is important to me.
- Wheeler-dealers: I ask for a product demo, we get it, followed by a cold quote for $3M for an off the shelf product. I don't respond, and get an unsolicited quote that is now $2M. I usually reply with an email that says "Not gonna happen."
I'm surprised to see Oracle on the anti-pattern list. Though their tactics sound aggravating, they've made an incredible amount of money from it. It seems hard to argue with those sort of results.
A contract that a state budget office signs with approved vendors. The budget office vets a set of vendors for, say, copy machines. Every office in the state then has to purchase from one of those vendors for their copy machine needs.
It's a fraud protection thing. It prevents one of the many many tiny offices from funneling money through a phony vendor.
This is part of my job, buying from the side of large companies so I will provide some input.
This is talking from the direction of actively engaging a large business and selling to them. I work on the side of large business actively choosing which startups we want to work with.
"Lesson 1: In larger organizations there are multiple individuals with separate motivations involved in the buying process "
Without question this is important. I am sort of a gatekeeper in the process. It's my job to validate the companies that are seen by the real decision makers (not me). I am the technical grunt in front of the process allowing the C level decision makers to only make good decisions no matter what they decide to do.
With me, you can discuss tech on a geek level, and I'm most comfortable and at home.
To my C levels, you better be high level and respectful. We've lost the ability to work with several startups simply because they weren't able to discuss on a C level.
If you are a founder and can't discuss on a C level, hire someone who can. You could lose a tremendous level of money and momentum simply because you have no idea how to talk to someone who leads a large business.
The reality is, I wouldn't be good at it either. I do well with our C levels, but they know I do good work for them, and am an employee. I think that changes the dynamic.
If I were in a startup (I have been) I would have someone else do the talking to C Levels, not me.
And even then, my job isn't to make the startups look good in front of our C levels, it's to pick out software for us to potentially use or buy. It's the VC's job to adequately prepare the startups, not mine.
I've done those sorts of sales talks when I was a tech consultant at Accenture and continue to do some now as a technical founder. I have also heard the pitch from vendors when I was at Accenture wanting me to bring their wares to my clients.
In the end it comes down to being able to communicate and listen well. Be an active listener and find out the problems that the C-level customer has. This could mean the actual business problem (sales needs to grow 10% and it hasnt for 3 years), logistical problems(my teams don't communicate), a political problem (I can't deploy a solution without getting the Network Solutions team invovled) - all are things 1) You should know about and 2) You may be able to fix.
That sounds simple, but it's really very hard to not get too wrapped up in what you and your company are focused on, rather than what this specific customer in front of you right now cares about. The best salespeople of ANY kind are very good at getting in synch with their customers - seeing the world, and their product from their customers POV and then seeing how their product fits into that worldview.
This is great advice. There's a strange reality that the C user has some agenda you couldn't envision, and you could fix some problem they have you aren't even aware of.
Some of the worst complaints I've heard is that the startup comes in all cocky thinking they have the best technology in the world, and doesn't actively listen.
It's a great question, but I don't have the insight on it. My job is on the technical level, and I can just convey to you what happens in a real company.
I don't think I would be the best choice to give the talks. I'd be fine for drinks after.. I'm casually good with C Levels, but I'm a tech at heart, and having me explain things... I tend to do the bad thing of going too technical, and not realizing it before their eyes glaze over.
hmmm it seems like the key is to find the balance between evangelizing your product/vision while genuinely soliciting inputs from the C level on what their priorities are. Hopefully there will be a match somewhere in that conversation
This is why you need a dedicated and experienced sales person. Selling to a small company is one thing, but selling to a larger customer is an entirely different skill set. And then selling to enterprise is even more different. The sales cycles differ tremendously depending on how large the organization is.
If you are targeting SMBs, you can get away with direct sales, etc. But once you get into the "bigger fish", the sales cycle lengthens incredibly, as do the requirements from the buyers.
One of my previous employers made the transition from selling from SMBs to enterprise, and it was a difficult transition. Our product was usually bought by a department head that required it, and it would spread across the organization organically. However, once we entered enterprise companies, instead of talking to the department heads, we needed to talk directly to the CIO/CTO, who would make the decision on behalf of the entire company. This required a lot more patience, and a completely different skillset from our salespeople.
So in the case of the OP, trying to land a big fish by talking with contacts like this is likely a huge timesink, because experienced salespeople will eat guys like him for breakfast. If you're going to target bigger fish rather than smaller shops, it's best to get someone who knows exactly what the process is and is actually focused on sales. The charm of working with a startup is lost on bigger customers, who have bonuses based on uptime, SLAs, etc.
The first point hits close to home; I have twice been in the position of losing happy, paying customers due to other decision-makers getting involved. I work for an agency, not a start-up, but it's the same process: convince someone within an organization to pay you large sums of cash for services.
In both cases, we were providing services to a single product group within a company large enough that those product groups can act nearly autonomously. And in both cases, the corporate office came to the (quite rational) decision that having ten product groups using ten different agencies was inefficient. In one case, corp's pet agency became the agency of record; in the other case, they actually built an in-house department from scratch and stopped using agencies altogether.
If there's a moral to this story, it's to scale that ladder. If your product/service/whatever only has one customer within a large organization, your use is vulnerable to consolidation moves. But, if your one user is happy and satisfied, you can often use that to gain wider traction within a company. In addition to more customers, it's a much safer position to be in when someone from on high wants to start standardizing across the organization.
Great post! An oft heard question, we get as a start-up selling to large enterprises is - How will you meet our need for these N custom features? Being constrained on the software development side, we've found it helpful to triage the client needs and lay out a phased plan for development.
Also finding a champion for our product in the client organization, usually a mid-senior level executive, who can coach us through their decision making process has been helpful
There is an interesting tidbit in the article about the other vendor doing a proof of concept. I work for a large enterprise and I’m working with a company that has gone to great lengths to facilitate a proof of concept. We're using ~$250K worth of their equipment and weeks of their time, not to mention travel and all the expenses that entails. As far I know, we haven't given them a dime yet.
I don't know how a smaller company would be able to do this.
For complex sales, one thing I've found that really helps is to create a worksheet and use it during the sales call. It asks things like:
Who is involved in the decision?
What are their primary pain points?
What are some reasons they may not buy? (Paradoxically, asking for objections instead of waiting for them to pop up makes you seem more trustworthy)
Nice summary. That's what makes enterprise sales challenging and time consuming and why Steve Blank spends a lot of time in his book explaining how to navigate it. What are some other common objections/challenges you've run into and how have you overcome them?
I'll keep the response specific to sales objections that a growth stage startups face
Scalability objections: can you scale to our volumes?
Respond with suggestions for a phased roll out. Take your backend expert in to the meeting and present credibility on why you can scale.
Company objections: will you be around for long? What if you get aquihired?
Reiterate vision behind why are doing your startup (hopefully the right reasons). Talk about your investors and the expectations/commitments made.
Control objections: "We are uncomfortable giving up control over this part of our tech stack"
Try to create analogies. Understand other parts of the stack that they have given up control over and why they feel comfortable with those. Feed those expectations back as contractual commitments that you are comfortable making.
Yes, I was wondering about sales objections, thanks. Those are good ones. What about resource constraints to integrate? This is one of the most common I've run into. Even if integration is as simple as a copy/paste of some code, it still requires moving ahead of their pipeline. To help here, focus on making it as easy as possible to integrate and also help the customer see why it helps them to make it a priority by showing the benefit of adding now vs. later (ROI data). Have you heard similar objections or are you only pursuing customers that have already reached out to you and have thus, presumably, already determined file upload is highest priority?
We intentionally chose to focus on making the integration as easy as possible. The key is to get the customer to try a proof of concept as easily as possible. We still need to do a better job of it.
This can actually backfire if it's not done very carefully and tactfully. Reaching out to multiple people in the same organization can also make it appear that you are just blindly going fishing. Those people will triangulate, and they'll talk, and they'll compare notes. You'll need to make very sure that you've actually tailored your pitch and conversations to each of the people you're approaching.
If you're just sending the same, cold-intro email to different folks in the same company, they'll find that out pretty quickly, and you're dead in the water. By the same token, if you've been cultivating a relationship with Person X, and then you reach out to Person Y, Person X might feel that you've circumvented him, or gone over his head, and then you've bred some resentment with him. Instead, try this: if you've made decent headway with X, ask him if he thinks speaking to Y or Z would be a good idea. He may say yes, and actually give you the permission. He may even broker those introductions for you, provided he really believes in your pitch. Or he may point you in a more productive direction, with different people that hadn't occurred to you.
I'm not suggesting that the author is recommending a clumsy, cold approach to multiple parties. Nonetheless, I've seen it done so many times -- both on the buy side and sell side of consulting -- that I feel it bears mentioning. The general advice in the article is sound, but putting it into practice takes a fairly deft touch.