The average win rate in B2B software sales is around 20%. Yours might be higher or lower, but then again, these numbers don’t get reported on in a consistent way anyway. Some sales teams define win rates as won opportunities divided by total opportunities created in that period, others only count the qualified opportunities, or even opportunities that reached a certain stage.
What does seem to be consistent across most teams is a recurring reason why deals are lost: poor qualification. You came in way too late, competitor X had already influenced things, previous attempts had lead to nothing, or the prospect never was going to be able to afford your solution. For whatever reason, you agree it just wasn’t the right opportunity. After it was lost.
But here’s the thing. The next time around, the exact same scenario plays out again. Once more, you spend precious time and energy on something that you will label as a waste of time later on. It’d be easy to simply blame the rep for being too pushy or enthusiastic to chase the deal, but the reality is that for many of us, rational reasoning seems to get suppressed in the heat of the moment. Our judgement gets clouded into Positive Delusion – the ungrounded hope that it might all work out.
So what to do?
Yes, we do need hope and optimism, but not if it leads to poor decisions. Three simple practices can help avoid the downside of Positive Delusion in sales.
1. Insert a fresh set of eyes in the early stages
All too often, qualification is just a subjective set of poorly defined criteria which the rep assesses in a pretty solitary way. Improve the process by creating a qualification review that involves the Solution Consultant, or the Front Line Manager. While there might be some apprehension for yet another review, the reality is that inserting some objective reasoning early on in the cycle will free up time later down the track.
2. Start with the end
This saved time should be spent on pipeline activities. Work out a Sales Productivity Model that shows how many opportunities will have to be generated to get to target. This will often serve as a wake up call; you simply can’t afford to waste time on bad opportunities. Pipeline generation requires focus and discipline; clear activity targets on lead generation are at the very heart of that.
3. Do Win/Loss analysis
The rather lose practices sales teams tend to have on reviewing successes and mistakes not only limit their ability to learn and improve, it also hinders accountability. At the very least, collectively agree on the “Lost Reason” before you log the lost opportunity into your CRM. Data is delusion’s ultimate nemesis, but only if it that data is valid.
Like to get more tips on how to get to target with a calm mindset and a smile on your face? In my new book, In the face of challenge: Perseverance in sales, I tell the story of my life-threatening kitesurfing accident that left me in a coma, and explore what my two-year recovery taught me about perseverance. I share over a hundred practical tips for AEs, CSMs, SCs, SDRs and their managers on how to deal with challenges in sales, and how to avoid them in the first place. For more details and a list of retailers who carry the paperback and ebook, see my website.
Ahh, Q1. The quarter with the most valid excuses and distractions for sales people, including the invigorating Sales Kick Off (SKO). Most of us flew to HQ and were treated to an energetic week packed with reviews of last year, exciting announcements about this year, award ceremonies, and … sales training.
While the excitement of SKO tends to last for a while, the impact of sales training often doesn’t. By the time the hangovers and jet lags have worn off and we get back to work, most of us pick up our old habits like nothing happened. Notwithstanding our great intentions, only a couple nuggets of gold from the multi-day sales training actually end up “sticking”. This is not just an SKO phenomenon; of all the great frameworks, tips and skills that our sales trainings cover, not much ends up properly getting embedded in the field. Why is that? Why is it that so much of this great investment to help increase our win rate, goes to waste?
The answer is nearly 150 years old and was first revealed by Hermann Ebbinghaus who studied the brain’s ability to retain information. Numerous follow-up studies have proven his thesis to still be valid. It’s a pretty simple one. Most of the information that we absorb soon leaves our brain again. Yes, we forget. Quickly. With sobering clarity, Ebbinghaus’ Forgetting Curve illustrates just how quickly. Within one hour, people will have forgotten, on average, 50 percent of the information which they were presented with. Within 24 hours, that memory leak increases to 70 percent. Within a week, people generally have forgotten nearly 80 percent of what was taught. This has nothing to do with intelligence. It’s more of a protection mechanism of the brain. Survival mechanisms have made it selective around spending energy to store information. It’s not the sponge to which we figuratively refer. The brain has built-in protections to cope in overwhelming situations. Like SKO.
e-Learning modules that allow you to process easily digestible snippets of content are only part of the solution. Your brain is still wired to forget most of what it has been presented with.
So what to do?
Focus and repetition is key. As a team, agree on two key elements from the training that you will be holding each other accountable for this quarter. To support the brain in creating the new habits, use templates. For instance, if discovery is your priority this quarter, focus on proper use of the discovery template that (hopefully) came with your training. As a manager (or SC!), if you see poorly filled in templates, go through the discovery questions from the training and coach the rep towards a better completion. If your priority is to elevate the conversation away from features and functions towards business issues, focus on the appropriate template to uncover these. Make a habit of attaching the completed templates to opportunities in your CRM and hold each other accountable. Once you feel comfortable the new habit or skill has properly been embedded (say, 90% of opportunities have a properly completed template), you move on to another set of priorities.
Don’t try to do too much at the same time. If you focus on five priorities, chances are you’ll do a half-assed job on all of them. Just focus on two and do them properly before you move on to the next couple. Oh and just to prove the forgetting curve applies to your brain, too: what % of information has generally been forgotten after 5 minutes?
Like to get more tips on how to get to target with a calm mindset and a smile on your face? In my new book, In the face of challenge: Perseverance in sales, I tell the story of my life-threatening kitesurfing accident that left me in a coma, and explore what my two-year recovery taught me about perseverance. I share over a hundred practical tips for AEs, CSMs, SCs, SDRs and their managers on how to deal with challenges in sales, and how to avoid them in the first place. For more details and a list of retailers who carry the paperback and ebook, see here.
Just when the finish line of your sales cycle is in sight, your prospect asks you to jump over one more hurdle. They like to speak with one of your customers to get unbiased feedback on your offering.
Even though it’s quite a common request, organising such reference call often causes unnecessary angst. Stumbling here could jeopardise the momentum of the evaluation, or worse, put your whole deal at risk. The 7 steps below help you get the most out of this important step to seal the deal.
As you go through these steps, you’ll see that while they are written for sales people, they also apply to a reference request during an interview process for when you, well, sell yourself.
Step 1 – Keep them warm
You’re going to need to dip into this powerful source of validation regularly, so don’t be that person who only pops up when you need something from others. Make sure you develop and maintain a community of references whom you have regular contact with. Find one or two references for each of the most common topics.
Step 2 – Find ‘the why’
Prospects don’t always have a clear idea why they need a reference call, or what specifically they want to get out of it. To avoid wasting time or even losing control of your deal, you will need to get this clarified. A consultative line of questioning could be: Sure, I can help you with that. Just to make sure I guide you in the right direction, what insights would you have gained after the call that would have made it a valuable use of your time? Don’t do this over email as nuances can easily get missed – both ways. Answers tend to fall into one of three categories:
a) “We’re just exploring”. Such a scenario does not warrant a reference call, so you’ll have to push back. Once your solution, integration, services, pricing, and contract have been evaluated, reference calls are a valid final check, but if they’re still exploring, you’ll need to guide them to alternative sources. Often, an underlying distrust towards sales people is at the heart of such thinking, so find out how you can better position yourself as a trusted advisor. A friendly way to push back is to explain that you want to avoid your customers get overwhelmed with requests, just like when the prospect would become your customer, they wouldn’t want to get a call every day. Offer case studies or videos from your annual customer event instead, or invite them to a local event where they can learn more about your offering, and informally meet other prospects and customers. Non-committal reactions point to the need to build more urgency or even a re-qualification.
b) “We need to validate what you’ve been presenting”. Assuming this happens towards the end of the cycle, this is a fair request. Ask what specific topic they like to verify and find out if there’s an underlying concern that ‘requires more selling’. Topics typically involve a function of your product, a specific use case, the architecture or eco-system integration, the user friendliness, the services involved from you as a vendor, or the work required at the prospect’s side. For instance, if it’s about your services, is it the initial implementation, the integration, or ongoing customer success? Get to the bottom as concerns are often based on seeds planted by competitors.
c) Sometimes, the answer points to a formality. “Procurement stipulates that we need to do a reference call with every new contract – it’s just our process”. Don’t be afraid to push back and turn this into something more constructive – they’ll not only get more out of the call, they’ll see your prodding as a value add. For instance, if your USP for that prospect is your ability to automate their processes, suggest that similar prospects have asked questions around that, and link them up with a customer who sees great value from that aspect of your solution. Guide them so your customer doesn’t perceive the exercise as a mindless tick of the box.
Step 3 – Negotiate
To maintain momentum, put forward a counter demand. “Once this is done, do we have a deal? Can we go to redlines? If not, what is the process at your end?”. I often see reps who are nervous to rock the boat by asking such action oriented questions, but when you’ve been asked to involve your customers, it’s completely fair to ask for something in return. A non-committal answer will expose other gaps that will need to be addressed, before you commit to a reference call.
Step 4 – Prepare your customer
Depending on the topic, determine which customer is most suitable. Also make sure you find the right person to address the topic. Call your reference in advance, and tell her what your prospect is trying to do, what their current limitations are, and specifics they like to see validated. The prep call helps avoid surprises that can kill your momentum. For instance, I once had a prospect who specifically wanted to learn about migrating from a competing platform which my customer also had been on. This had happened before my reference worked there, so after my prep call, she pulled in someone from the IT team to ensure these questions could be answered straight away. When you summarise the details in a brief email after the prep call, include your key sales messages in the lingo you have been using with the prospect.
Step 5 – Prepare your prospect
To avoid last-minute nervousness in these final stages of the deal, it’s key the call doesn’t produce anything alienating. Call your prospect to explain your customer’s configuration, their ecosystem, and the reason why they get so much value out of your solution. Provide details about the role of the reference, including the similarities and differences from the prospect’s role. People don’t often explain their technology stack or processes to outsiders, and unconsciously end up using internal acronyms, system names, and role titles that can sound irrelevant and foreign to your prospect. Make sure to ‘translate’ all of that – both ways. Summarise it via email so all information is in one spot. It’s a great opportunity to re-affirm your key sales messages as well.
Step 6 – Hook them up
After your prep calls, send a brief email to both the customer and the prospect. Share their contact details, links to their Linkedin profiles, and briefly confirm the topics of the call to guide the conversation. To avoid full agendas slow things down, suggest a time slot that you know your customer can make (within the next 24 hours), and let them work it out directly. If your reference is in a different time zone, include a link to an online time zone scheduler to avoid delays.
Step 7 – Close
After they’ve had their call, check in with the customer to thank them for their time. Do a quick run down to see how the conversation went, and whether any questions were left unanswered. Write notes and share these with your wider sales team: you will pick up on landmines from competitors that help you be more proactive on these with your next cycle. Provide something of value to the customer, like a 3rd party white paper, a ticket to an event or a chance to speak at one. Then, follow up with the prospect to see whether they’re ready to move onto the action you agreed upon before. Sometimes, minor additional clarification is required, but in my experience when you go through above effort to make it all happen, prospects don’t come back with new requests. You can keep the foot on the gas and move your deal to a close. And once that has happened, don’t forget to close the loop with your customer and tell them about the good news!
Like to get more tips on how to get to target with a calm mindset and a smile on your face? In my new book, In the face of challenge: Perseverance in sales, I tell the story of my life-threatening kitesurfing accident that left me in a coma, and explore what my two-year recovery taught me about perseverance. I share over a hundred practical tips for AEs, CSMs, SCs, SDRs and their managers on how to deal with challenges in sales, and how to avoid them in the first place. For more details and a list of retailers who carry the paperback and ebook, see here.
There’s this awkward truth that sales professionals never talk about. A challenge that usually doesn’t get brought up in sales meetings or bid reviews, doesn’t get complained about at the water cooler and definitely doesn’t get discussed amongst friends. It’s such an uncomfortable topic, that most sales trainings don’t really address it, or at best kinda dance around without calling it out. But however uncomfortable it is, it’s still the truth. People don’t like to deal with sales people. Buyers don’t like being sold to. Us B2B sales professionals are seen as a necessary evil that should be avoided, if possible. We get grouped into the same bucket as second hand car salesmen and snake-oil sellers who can’t be trusted and are only driven by personal gain.
That view is not a recent development either. This underlying negativity towards the sales profession has been around for a while. Wolf of Wall Street, Gordon Gecko, Glengarry Glen Ross, the Boiler Room and other populistic depictions of our profession, all enforce that snake-oil stereotype of dishonest human beings whose main motivation is personal gain, with no regard to damage done to others. And these stories always end it tears; the last scene tends to involve a culpable and sweaty insider wired with a microphone, followed by the FBI raiding the sales villain’s premises. Not exactly the poster children that make us proud of our profession.
Sure, in the last twenty years, the sales profession has smartened up. But so have the buyers. I am sure you’ve seen the stats from the likes of Gartner, Forrester and CEB saying “57% of the purchase decision is completed before a customer even calls a supplier”. And “two thirds of the buyer’s journey is now done digitally”. Those headline grabbing numbers obviously simplify things, but nonetheless, they do expose the existence of our uncomfortable truth. B2B buyers prefer to research their options online, away from the sales person. Only when there’s no other way to get the information they’re after, do they call in the rep – like when they want a demo or pricing.
Of course, poor sales practices are to blame for these perceptions and the resulting behaviour at the customer’s side. Us sales people have to be more customer centric, and be more consultative. We need to listen, and help the buyer find a solution that fixes their pains. We should tailor our messaging to the customer’s needs, and show how our offering is the best solution for them. In short, the best sales people are problem solvers who guide buyers to find the right solution. Right?
Wrong. In SaaS sales, we don’t need problem solvers. What we need is problem seekers.
Problem seekers help customer uncover problems they’re not aware of yet. Problem seekers guide customers to look at their pains in a different way, because “the old way of doing things, no longer works”. Problem seekers take buyers by the hand as they formulate their needs, the budget they need for that, and the people they should be involving, before they start looking for a solution. Problem seekers take control way before BANT happens. Because when Budget, Authority, Needs and Timelines are established, it’s already too late – it becomes a matter of problem solving. And there are three reasons why problem solving in SaaS sales is a bit of a shitty exercise that makes us frustrated and want to give up.
Firstly, our uncomfortable truth means that buyers won’t let you in – they will do their problem solving research online. They simply don’t need sales people to find a solution. Secondly, we sell SaaS, which is a (typically multi-tenanted) solution that roughly does the same thing for everyone. We don’t develop features or customise modules specifically for individual customers. In other words, the only way that we can solve a customer’s problem, is when what they’re looking to solve, co-incidentally is exactly aligned with what we’re selling. Clearly, counting on that happening, severely limits our chances. Finally, even if a sales person is able to provide an eye-opening new view that makes a buyer rethink the way they look at their problem, it’s hard to get a B2B buyer to back-paddle. Once a multi-stakeholder buying team has decided on budget, business needs, the people to involve, and the timelines to commit to, it’s an uphill battle to go back and change things. It’s possible, but no one likes to do it.
So what to do?
Much of this thinking you’ll recognise as challenger sales. Whether you adopt such (or similar) sales methodologies or not, it’s important you acknowledge the role customers allow you to play. Once BANT has happened, your ability to take control, or even to add value, is limited. If you truly want to add value, become a domain expert about the problem, not just your solution. Adjust your sales pitch to talk about your customer, rather than you. Focus your outbound activities by segmenting your market based on propensity to buy, not just industry. This allows you to get in early, before a client starts shopping around. Make sure your internal sales reviews and CRM reporting focus at the early stages of a deal, not the later stages. True value for the buyer can and should be added early on, when key decisions around the problem are made. Become a problem seeker and work hard to get a seat at the table when that happens. Because it’s during these very early stages where deals are won, not the later stages.
Last weekend, I found myself in the garage unpacking and dusting off our old DVD player. I never threw it away, because, well, you just don’t throw away a working appliance. The joy to see the lights come on after plugging it in, was short-lived. Our new TV had different video input connectors, so I had to drive to the shops to find a new ‘old’ cable. After a bit of to-ing and fro-ing, I got it all hooked up, grabbed a bottle of wine, and, together with my wife, plucked the fruits of my hard labour. We watched Finding Nemo. Again.
Yep, for the umpteenth time, we watched that Pixar classic that raked in nearly a billion dollars. We saw it in the cinema when it first came out back in 2003, bought the DVD, and watched it a couple of times on Netflix. But to my horror, this weekend, I found out that it no longer runs on Netflix Australia! (Googling reveals that Netflix doesn’t carry titles forever; they sign licensing deals that only last a couple of years, apparently). That’s why I had to take control of my own destiny, and find that old DVD player. And here’s the thing; my wife and I don’t have kids – I went through all that hassle just because we love watching that movie. Nemo does that…
Even though we know the story back-to-front by now, we still want to see it – over and over again. It’s not just the spectacular animations; there’s much more that keeps drawing us in. And after asking some friends, I realised it’s not just us. Most of us can watch it multiple times and never find it boring. Which is not the case with the typical sales pitch I come across. In fact, with many of them, I tune out within minutes. Why is that? Why is it that I go through all that hassle to watch a children’s movie which doesn’t give me anything new, but I can’t get myself to listen to an average sales pitch? This warrants a deeper analysis.
A typical sales pitch roughly follows this structure:
This is who we are, and here’s a map of all our offices across the globe
We got funding/IPO’d/have a valuation (or revenue) of $x
We have these solutions, and we think they’re amazing
And Forrester/Gartner/Fortune/ … think we’re amazing, too
Look at all these logos we have; basically, everybody thinks we’re amazing
Here’s a quick demo of our amazing platform
Wanna do business?
You give me a pitch like that, and I give you and audience that collectively grabs their phones to check their emails five minutes in. Maybe when you get to the demo bit do people sit up again, but by then, energy levels have dropped to that same point your iPhone seems to reach before lunch nowadays. The meeting ends with some vague agreement on next steps, with a level of commitment that can only be summarised as “meh”.
One thing we can do to spice things up is to start with a personal story or anecdote. The idea is that the audience better connects when there is some unique or personal angle, and as a result would be more engaged throughout the rest of the presentation. While it could raise energy levels and participation in the first few minutes, an anecdote – however original – hardly ever is enough to carry the audience through the dreadful stages that follow. You need much more to get your audience to sit at the edge of their seats, absorbing every single thing you have to say. Finding Nemo accomplishes exactly that, so let’s see what we can learn from its story telling.
I can’t possibly imagine you haven’t seen this movie, but still, let’s start with a brief refresher on the story line. Nemo lost his mum and as a result, Marlin, his dad, is very protective. He doesn’t want Nemo to stray too far – the ocean is a dangerous place – and raises him in the security of an anemone. As you’d expect from a kid, one day, Nemo does swim into the open water towards the edge of the reef. He sees a boat, and in an act of defiance, tries to touch it with his fin. He gets captured by a diver and ends up in a dentist’s fish tank in Sydney. Marlin goes on this big search to find Nemo, and when they eventually re-unite, the characters have learned some important life lessons. Never give up, trust the people who love you, appreciate what you have before it’s gone, and don’t be afraid of leaving your comfort zone, to name just a few.
Clearly, a sales pitch is not in the business of evoking emotions around such morale. But that doesn’t mean we should disregard powerful story telling. Finding Nemo teaches us three things around how to draw in an audience.
First, the story has a fair bit of tension, especially for a kids movie. It’s not all positive. As with most stories of fiction, the first act is rather happy and good, but then – after Nemo gets captured – scene after scene of challenging events follow. There are sharks, exploding mines, stinging jelly fish, hungry seagulls, and of course, Darla, the dentist’s niece. Thanks to Marlin’s persistence and the teamwork of the other sea creatures he meets along the way, there’s a happy ending. The story goes up and down from positive to negative which leads to tension – and it’s this tension that captivates the audience. It wants to find out how the characters overcome the challenges they face.
Sales pitches tend to miss that. They paint a picture of pure positivity, and that’s not only boring, it makes the audience instinctively question its credibility. Because in real life, it is not all rainbows and butterflies.
Secondly, we recognise ourselves in these characters. Their struggles resonate with us. At the start of the movie, Marlin is overprotective, scared and insecure, but he comes out stronger and with more confidence. Nemo is curious, loyal, and despite his handicapped fin, pretty brave. Other than being absent minded, Dory is also very honest, and optimistic. We can find ourselves in these traits, and as a result, we become emotionally tied to the characters, and, hence, the story. We want the characters to win, to come out as the heroes, because we are just like them.
The problem with most sales pitches is that they try to make the vendor the hero. Worse, it’s all about the vendor. The reality is that your potential client doesn’t care about you winning. They care about themselves. The vendor should never be the hero in a presentation. The client should be.
Thirdly, the movie’s key conclusion is around those moral lessons. Nemo, Marlin, and Dory had to go through this ordeal, so that they could gain these insights. Watching a Pixar movie as a grownup, we know we’re going to be treated to these underlying life messages that are crafted for us, not just kids. We’re going to learn something. From the very first minute, the movie is set up like that. It sets the scene that overprotection isn’t good, and even though we don’t know how the story is going to unfold, we unconsciously have buckled up for the journey to get to the moral lessons, e.g. the purpose of the story. We’re not just watching because of the amazing animations and funny characters, we also want to be taken on a journey towards this ‘why’ behind the story.
Sure, conveying messages of morality is not the typical goal of a sales pitch, but we still need to be clear on the purpose. As Simon Sinek says, we need to start with why. Too often, sales presentations skip this part and go straight into the what, missing out on the opportunity to connect with the audience on a deeper level.
So, what to do?
Start your pitch not with what you do, but why. Confirm that you understand the client’s world by showing them how it’s been changing (for example, “consumers are getting more demanding”). Then, articulate how that change is creating tension or challenges for the client (“because the business systems and processes in place are based on consumer expectations from the past”). Then, show how this tension leads to business problems (“consumers might leave you for more agile competitors who can meet their needs”) and urgency (“as a result you could see your revenue drop”).
Build this tension and build on the why as long as you can, because once you get in the weeds of the what, it’s really difficult to elevate back to pains and solutions at a business level. And if a potential client isn’t convinced on the why, they’re never going to be convinced that they need your what. (Note that this emphasis on the why reduces during the progression in the sales cycle; when you get towards your final presentation, your client should have bought into the why. A mere summary would suffice, before you go into great detail demonstrating the what).
Then, switch the tension and take them on the journey towards what could be. Explain how your solution addresses the business problems you described before, without going into too much detail on specific features and functions (“you can’t fix this fundamentally flawed architecture with old school systems and processes; you need a new, data-driven way that’s fully automated. We’ve come up with a solution to help you just that”).
Finally, show how you’ve helped other clients overcome similar challenges, and show the positive results they achieved. Don’t just show logos, but put in statements from three or four clients which articulate the journey from business pain to great results. These are the independent proof points that show how great you are, but with a much more credible “don’t take it from me” angle. Ensure these proof points are articulated in the language of the client, so that they can recognise themselves in the hero of that sub-plot, a client just like them.
Crafting good pitches isn’t easy, and will take a lot of practice. ‘Dancing’ with the tension can be particularly tricky for reps who don’t like uncomfortable conversations. However, you will need to build the confidence to go there. It will help you elevate your pitch, and be seen as a trusted advisor. To learn more about this captivating skill, watch how Nancy Duarte finds these structures in speeches of great narrators like Steve Jobs. Sure, you will make mistakes along the journey, but don’t give up. It’s like Dory says: “When life gets you down, you know what you gotta do? Just keep swimming. Just keep swimming”.
Not all B2B prospects are the same. An online retailer has different technology needs than a bank. They simply care about different things. While the latter has share of wallet and compliance top of mind, the retailer lies awake about conversion and logistics. As a result, these different goals and business models lead to different characteristics for a B2B prospect, with different pains, and different budgets to fix those pains. Most SaaS sales teams recognise this need for tailored sales strategies and tactics in their territory plans. That is, to some extend; a key aspect typically doesn’t get the attention it deserves, setting the sales team up for failure.
Let’s start with what your territory plan most likely already covers – positioning. If you sell a SaaS solution that roughly does the same for all customers, it doesn’t mean your sales pitch should be positioned in the same way to all your prospects. Your pitch should be tailored, so that potential buyers can recognise their own pains and objectives – and easily see how your solution can help with that. Your sales training would have focused on customising talk tracks and sales pitches to client-specific themes. Maybe you even have a sales enablement team that created vertical-specific playbooks, to help position the value of your solution through tailored sales messaging. Awesome – the more your pitch is positioned in line with the prospect’s view of the world, the better.
There is another aspect of the notion that not all prospects are the same, and it typically doesn’t get the attention it deserves in sales plans. Segmentation. In fact, the concept of segmentation sometimes gets mixed up with positioning. They are two different things. Positioning determines what you will pitch, while segmentation determines who you will pitch that message to, or in B2B sales: what kind of companies you will go after. The aim of segmentation is to identify high yield segments – that is, a group of accounts that are likely to have the highest chances of buying from you, or that have the highest growth potential for land-and-expand deals. The whole idea is that you should target those accounts before you go after other segments that are less likely to buy from you. Yet, many B2B SaaS sales teams don’t put a lot of thought into what such companies tend to look like.
What is often in place in terms of segmentation is pretty rudimentary. Most B2B Sales teams merely look at “vertical” or “size” as key characteristics for segmentation, and blindly take guidance on that from headquarters. For example, they’ve prioritised “Retail” or “Financial Services” over “Manufacturing” or “Government”. Or they decide to only go after “enterprise accounts”, or organisations between 10 and 1,000 employees. But these segments are often way too broad: thousands of accounts end up in a territory with the presumed notion they’ll all have the same propensity to buy. This absence of a smart segmentation strategy in sales nearly always leads to a lack of focus – with frustrating results.
There’s nothing worse than filling up the top of the sales funnel with the wrong kind of opportunities. It creates a false sense of hope, which will take a while to get exposed, because reps often find it difficult to let go of an opportunity once it’s past qualification. They end up wasting time and resources as they repeatedly push the opportunity into the next quarter. To see how big a problem that is for you, run some pipeline reports on “Pushed out more than 3 times”, “Lost to No Decision”, or “Lost to a competitor that we don’t really think is a competitor”. If that raises some alarm bells, you need a more thoughtful segmentation approach that goes deeper on this notion of propensity to buy.
So, what to do? Segment your territories on propensity to buy by implementing the ABC Model. “A” accounts are those who are most likely to buy, “B” are less likely and “C” are the ones you want to avoid (even if they joined five of your webinars). Develop a parlance where Marketing, SDRs, Sales Reps and Sales Management show an understanding that the companies they go after should fit in either the A bucket, maybe the B bucket, but definitely not the C bucket.
This ABC distinction should be done on three areas of characteristics: Firmographics, Technographics and Demographics. Your current segmentation most likely already covers some of the Firmographics. These are the things you can easily determine from the outside: the number of employees at the prospect, its vertical, revenue, business model, and geographical reach. But as said, you need to go deeper.
In SaaS, the Technographics often say much more about likelihood to buy; it reflects the current technology footprint of an account. Buying SaaS needs a level of maturity, which often is revealed by other technology solutions the prospect uses. At its simplest, Prospect A who uses your cheaper competitor is more likely to be ready to “upgrade” to yours, than Prospect B who has never even bought SaaS and still uses manual processes and spreadsheets. Even if Prospect B is of the right size and in the right vertical! Determine what these Technographics look like for your A, B and C accounts. Then, use tools like Ghostery, Builtwith, or Datanyze to see what technologies are in place at accounts in your territory; get the enterprise edition so you can integrate it with your CRM.
As for Demographics, you look at the people side to determine the propensity to buy.Companies tend to develop (or hire for) specific skillsets first, before they buy the technology. Not the other way around. Look for key skills and role titles that are telltale signs for a readiness for your solution. At its simplest, who is more likely to buy from you? Person A who used your tool before and just started a new role in a different company that’s growing rapidly, or Person B who’s been in the role for ten years with a company that’s hardly investing in new technologies? Again, decide what these skills and roles look like for your A, B, and C accounts. Then, see what’s out there. Tools like Zoominfo and Discoverorg offer some value, but don’t always have good data for companies and contacts in APAC. Linkedin is your biggest friend here, particularly the jobs section, where you can create alerts that let you know when certain roles pop up. Go after companies that are hiring for those skills as they will likely be in the market for a technology solution soon.
I know that this sounds like a lot of work, but remember, if you fail to plan, you plan to fail. Some of the tools mentioned will make this effort easier, and predictive analytics solutions like Leadspace, Mintogo, Insideview, and 6sense can even automate much of it. However, they don’t always have quality data sets for APAC. And since propensity to buy characteristics in APAC are not necessarily the same as those in the US or EMEA, be careful on relying too much on such technologies. For now, spend some time doing it yourself for your territory.
The effort of thinking through this ABC segmentation will create more focus in sales. It is not meant to be an algorithm that’s 100% correct, but it still will provide a more granular appreciation around what makes a prospect more likely to buy from you. Have a workshop with marketing, the SDRs, the CSMs and the AEs to determine what makes an A account, and what makes a B or a C. That exercise in itself is going to create several aha! moments that will lead to more focus in your marketing and sales activities.
