Two tips I've learned:
1) Don't discuss price up front if you can avoid it, especially if you're in the 6-7 figure price range. Try to get as much info as possible about their problem. Get them invested in you at a personal level.
2) If your emails go unanswered, instead of sending emails like "Hey wondering if you're still interested" send update emails about your product like "Hey Bob, just wanted to let you know we updated X so now you can do Y. Here's a video explaining more." I've had lots of success with this tactic.
I have a couple guys emailing me like crazy right now. I'm not responding. Why?
Nothing has changed. I don't need to respond every day to tell you nothing has changed. I start to get frustrated, and it turns me from an advocate into someone who just wants you to go away.
It's not that I mind talking about the issues, it's just.. if I say I don't have budget now, you asking me every week is not going to change that.
If instead you're telling me about what's updated, if something you've updated increases my business case, then that's actually actionable information I can do something about.
That's exactly the reason #2 is such a good idea (I do a version of the same in some cases).
You keep your name in front of the prospect w/o being annoying and requiring them to do anything. Along those lines though any contact if excessive can be annoying.
We've just entered into the B2B world and it's been every bit the eye opening experience you've described. Neither of us counted on how long it would take to close deals. We've figured out a few of these things along the way (trying to make sure we have an advocate and a buyer) but there's a lot of other good advice in this article that we'd never considered.
It can be very hard to read what a company might be thinking/discussing internally about your product. We actually do a bit of free work up front to show people what we can do and even then it can be quite hard to get useful feedback. Oftentimes we've come to the conclusion that they're just not interested only to find that on the next phone call they're ready to start paying.
Having come from a consumer world it's quite demoralising starting off in B2B. You often feel like you're never going to get anywhere but with enough persistence we're managing to make things happen.
Comments like yours (and articles like this) are very good for lifting the spirits :)
Or, to put it more bluntly - fuck email.
You want the sale? Pick up the damn phone. It is sooo easy to be an asshole over email. Brush it off, never reply.
You want a follow up? Get the person on the phone. Lots of nerds hate the phone - the great sales people work it like nothing else. Always smile during the call, it shapes your voice.
if you ignore his calls, you'll never read his emails anyway.
I used to start off with my rate and found that it makes customers uneasy as they try to tailor their game plan to your rate. It's a looming overhead for them.
A few tips and tricks from my practical experience:
* Big companies still have cultures. If you understand how the culture works, it's easier to get things done. In the best enterprises, you can just straight up ask "how do things get done around here" or "What is the culture like? Who are the stakeholders on a project like this?". In fact, asking people in B2B works a lot better than B2C because often you'll get people revealing their actual painpoints
* Fear of loss is a more powerful motivator than potential gain
* Followups are everything; I can't tell you how many times I've called a company 12 or 18 months later and gotten a deal just by keeping in touch
* B2B is ridiculously personal. Be likable; send people candy on their birthdays, if they have kids send them gifts for their kids (we send/give away branded Kazoos, which also happens to be the name of our product). The sales process often comes down to (unfortunately) who the decision maker likes the most. This isn't actually a bad way of doing business (although it can be) because when the chips are down having an antagonistic vendor-client relationship is terrible.
My two cents.
Source: I'm currently managing marketing for a bootstrapped telecom company that just cleared 30 employees. We sell straight B2B and these are tactics that have worked over the last 24-36 months.
Birthday card is OK, accepting gifts for my kids would probably get me fired.
We've received a box of twizzlers in the past. We don't eat twizzlers but it was a nice sentiment.
If you give someone branded swag it doesn't seem like a bribe and most likely wouldn't seem to be something that should get someone fired.
They typically have these types of things at tradeshows. And people try to grab so they have enough for all their kids.
Young Kids get excited with some of the lamest things it doesn't take much to make them happy. And when kids are excited because mom/dad walk in with something for them the parents are happy and it rubs off on the person who gave them the item for their kids.
And remember that all signed deals absolutely must be win-win. If your sales target feels or knows they're getting screwed, you're toast.
As an aside, also know that the days of "no one got fired for choosing IBM" are over. BigCos do plenty of deals with startups and small businesses. I could give examples of where that's worked out great for us, or terribly. I could also give examples of where choosing the 800lb gorilla was an awful decision.
If you don't enjoy this kind of existence, being an IT exec at a big company is probably not something you'd have fun with.
I've heard this kind of thing before, but something has always bugged me... how do you know their birthday? I have a hard time picturing a point in a business relationship where it would seem natural to ask someone when their birthday is... and if you did ask, I can't escape the feeling that it would feel "phony" or something, exactly like you were just going to use that knowledge to try to game them to buy more, by, say, sending them a birthday card.
So how do you deal with that? Do you just ask people what their birthday is, and they happily tell you, or do you at all try to "disguise" your intention by just working it into a conversation somehow, etc?
How do you know your friends birthdays? You either ask or you look it up on Facebook. How many times have you added a client on Facebook? Seems weird right?
If you did add a client on Facebook, you'd know more about them. You might discover you both like capoeira or that you both hate Nopa, or you might discover they love cilantro and you hate it. Whatever it is you discover, it'll be 1000000x more personal than trying to sell them on your product.
So how do you get their birthday? By being their friend. Big partnerships almost always consist of big friendships.
Good point. The thing is, people should understand that it takes time to build those friendships. And I guess that, in my mind, I see it taking longer to progress to the stage of casually exchanging personal details like birthdates, anniversary, kids birthdates, etc., than what I'd expect (hope?) many sales cycles to take. But perhaps I'm just overly cautious, as I've mostly tended not to get too personal with business acquaintances in the past. Maybe that's one of those things that I need to change my thinking on...
You might discover you both like capoeira or that you both hate Nopa, or you might discover they love cilantro and you hate it.
Yes, but they'll also discover that I'm a rapid government-hating Libertarian / anarcho-capitalist and an atheist among other things. Those kinds of details could damage a relationship, if it's the kind of thing they get worked up over. Now my mindset has largely always been "I don't need anybody who doesn't want to do business with me because I'm (Libertarian|Atheist|White|40+|A Miami Dolphins Fan|A UNC Tarheels Fan|Etc)", but still, there are things that, while I don't hide them, I also don't actively broadcast them to every business connection I make.
Anyway, thanks for sharing your viewpoint. This is something I need to think about a lot, as I'm just at that point where I need to start become a salesman and not just a hacker. :-)
Most companies tend to hold real allegiance to a small handful of customers. Get to know your key stakeholders. If you have a component supplier that makes up 30% of your business, you should have dinner with their key stakeholder on at least a bi-annual basis. If you have a set of clients that make up 40% of your revenue, invite their stakeholders to dinner.
You'll notice that I never say CEO, only stakeholders, because those relationships are the valuable ones. As you move further up the food chain I think you'll find, as I have, that CEOs are often figureheads with a big hammer. You need their permission, but the real leverage comes from elsewhere within the organization (usually not the techies, unfortunately).
We're all always selling things. It's an unfortunate consequence of the human condition.
Be genuine and build a real, no shit relationship with the person. Become 'work friends'. It'll come up - you probably know when your coworkers birthdays are, etc., right? The great part about biz is you just need to be in the right month ('hey, I heard your birthday is this month, heres X').
But really, don't be phony, and treat it like a real relationship with someone you'll be working with, and most of this stuff just happens.
Aaaah... to be honest, the answer is largely "no". And to the extent that I do know, it's because our office manager sends out a companywide email saying "happy birthday" to employees on their birthdays, and I remember the couple who happen to be close to my own.
I don't know, maybe I'm weird, but that just isn't something I've ever found myself talking about with co-workers and business acquaintances a lot. shrug Guess I'll need to adapt a bit as I struggle to get into the world of selling.
But really, don't be phony, and treat it like a real relationship with someone you'll be working with, and most of this stuff just happens.
Yeah, that seems like the right approach to me. Thanks for the advice!
Anecdotally, I receive 4-5 LinkedIn requests from sales & bizdev folks every week. I never accept them unless I already know and/or really do want to get in contact with them. :-/
Oh sure, and I have no problem with that. I'm not a pure extrovert by any stretch of the imagination, but I'm affable enough most of the time. All I'm saying is that I've never felt the need to get overly personal with business connections / co-workers in the past. Or maybe it would be better to say, I only get personal with those people when there's a genuine connection between us... I never try to force that kind of relationship, probably at least in part because I associate it with sleazy salespeople. :-)
But yeah, building real, genuine relationships is another thing. I'm just intrigued to see how that will dovetail with the sales process, as I perceive that it takes a lot of time to reach that level of friendship with new people. And it doesn't seem that you could possibly invest the time to become truly close friends with every potential customer?
I'm a bit curious about the sales process, too, and occasionally tempted by the opportunity to learn more about how many different companies work (with a chance at making high six figures in the meantime)... but I'm too risk averse to seriously consider a commission based job. Good luck!
Best book I've ever read on selling big ticket items: SPIN Selling by Neil Rackham. Engineers would love it (and it's short!)
Basically, you sell million dollar computer systems with the following process:
>> (S)ituation -- what are they doing now?
>> (P)roblem -- what is the problem with that?
>> (I)mplications -- how much is that problem actually costing them? -- as a number, it's always bigger than people think, particularly if it involves people doing some manual process somewhere
>> (N)eed Payoff -- Imagine your life if you fix this problem and imagine your life if you don't. Wouldn't you much rather lead the former?
The instant rapport quick close doesn't work in these cases (in fact, it hurts you)--you need to demonstrate real value, real ROI (as mentioned in the article) and you've got to do that by taking the problem and blowing it up really big, then offering two paths and letting your prospect make the obvious choice. Or something like that :-)
SPIN Selling is one of them but as an engineer I liked Solution Selling by Michael Bosworth even more, as it gives you a similar, but even more detailed process to follow.
In the back of his or her mind, the buyer is probably thinking things like: "Will these guys be around in 5 months?" As a small startup, the burden of proof rests entirely on your shoulders. The bigger guys have already proved themselves, and, while your service may be much better -- and while the potential customer may totally understand that -- the incumbents have incumbency going for them. That's no small advantage.
Another key thing to consider: departments (or people) within any given company tend to be profit centers, cost centers, or some hybrid of the two. They have very different goals, and hence, their people have very different motivations. Some people are empowered to take risks, and others are extremely risk averse. Pitching topline growth to a department mainly concerned with managing downside, for example, isn't going to get you very far.
To your point, it's typically more effective and realistic to pitch topline growth. But if that's going to be the case, then figuring out who at Company X is actually empowered to take chances on growth is a big priority. The number of these people in any given organization can be extremely small, even at large enterprises.
Incumbency is an advantage, and a weakness. Everyone hates what they have for some reason. Incumbency is rarely the issue.
The profit centers/cost centers idea is VERY true. I am empowered to take risk, and the people I have to change their systems are risk adverse. So you have an immediate issue that I have to deal with.
The best thing you can do to help me is have a business case vs. a competitor or competing idea already outlined.
Somehow startups rarely have this simple information prepared. It shouldn't be a shock to you that we're currently doing X.. instead of your Y. Why is your Y better than X in business terms?
How to run the "air war" could be a whole post. I think PR is the most important component, and you can actually get very far as a founder by just sending a journalist a friendly note and offering to talk. Quality of investors, team, and whether you have a personal connection to the company also matter a lot.
Indeed, and while I realize it's somewhat tangential to your article, I'd love to see your in-depth take on it at some point.
I also flatly disagree with the OP, in that I think in most industries "Our solution will cut your spend on X by 10%" is a much stronger claim than "Our solution could potentially increase your revenue by 10%"; even though the latter will usually represent a higher potential ROI. Rational purchasers are more confident of the savings generated by substituting for a product/process with known costs than they are of achieving theoretical revenue gains.
But when I think of, say, $5000/year revenues, if it's too high, I have to fight the corporate financial immune system. But if it's too low, I'm leaving money on the table when there's a ceiling on how many customers can ultimately be acquired.
Pricing is not even on the list of concepts I have to consider to work through a process. I work for a very big company though.
The product scales outward thing is overrated. Startups have talked to me about this too, and it doesn't make as much sense as everyone seems to think.
You gain a foothold in an area in the company no one cares about, that doesn't mean anything. You are the least person to judge which parts of the company matter, so be careful about that idea.
I just had a company do this. They built a foothold in an area no one cares about. I had to tell them, it's about as meaningless as an organization if you had our janitors using their software.
If your evangelists are not connected and part of the decision making process, the information doesn't expand.
To expand on Andy's general point, and one josh2600 made earlier, it truly pays to get to know your target's corporate culture and bureaucracy. One of the first questions experienced sales reps ask at the close of the second call (or whenever the first demo is) is something along the lines of "what is your sales process like?" or "how does your department handle budgeting, and what is your fiscal calendar?"
Oooh, before I forget, here's another big turn-off: yes, sales reps hop between companies more than engineers, but for goodness sake PLEASE keep your CRM updated so your target doesn't get repetitive cold calls from other reps at your company. This doesn't happen too often, but I still experience it about once a quarter and it leaves me fuming each time, especially if I already have a contractual relationship with the vendor.
I wrote a blog post on how to figure out whether your startup is New Enterprise or Old Enterprise: http://brandonb.cc/is-your-b2b-startup-new-enterprise-or-old...
I think once you answer that core question, the pricing and sales model fall into place more easily.
If you're pitching SaaS to an industry that doesn't usually go for it, it sometimes it helps to avoid PII. Even banks are somewhat open to using SaaS for products that don't touch customer's names, transaction info, etc.
Be careful, though, self-hosted customers can be huge PITA's.
This is a very odd statement that is in odds with how most B2B software is positioned. I would wager if you go into any company and look at the software installed, almost 95%+ will have a use case of reducing costs. Whether is automating your workforce, reducing inventory, optimizing product spend etc. Even software which touches the topline (like salesforce/CRM/SFA), at the end is about reducing the cost of sales not increasing revenue directly.
I would be extremely happy to help any of you who would like some insight into how the purchasing process works, and to answer questions about selling to big companies. If you'd like to chat, to practice your spiel or demos, or anything else, please contact me. There's nothing I'd like more than to help develop software sales skills!! :-)
I'm involved w/ enterprise startup and I've found a lot of things like MVP, feeder landing pages, etc. just don't apply for customer acquisition. We have a lot of issues with targeting the software at the users, but needing approval from other people...
But thanks for this article.
Automation can cut costs by much more than that.