Your SaaS company has got a minimum-touch self-service model working really effectively, your investors are happy and money keeps on coming in without you really touching anything, but there’s one nut that’s a lot harder to crack and that’s how to sell your SaaS product to enterprise customers in a way that is time-effective and cost-efficient, given your relatively low price.
Selling SaaS to enterprises often represents a bit of a pain point for SaaS startups so in this article I’m going to examine why you should persevere with enterprise sales. I’ll explain what are the benefits and challenges of selling your SaaS software to large companies, I’ll share the enterprise selling techniques that have worked for Leadfeeder as our growth has rocketed, and I’ll talk about about how we are specifically building our self-service SaaS software with enterprise accounts in mind.
As we’ve found out at Leadfeeder there are some huge advantages of selling to enterprise clients, such as the fact that purchases tend to be more significant and more consistent.
While sales might fluctuate or drop off in times of recession, a relatively stable economy tends to draw solid business from enterprises. Thanks to the larger scale involved, your company might not even need to close more than one deal per week or per month to meet your quotas. In our case, a Leadfeeder small plan costs $59 per month, whereas a typical enterprise deal is worth at least 5x that amount. That means that if we focus on enterprise accounts we can sell a lot fewer but still come out tops with a higher monthly recurring revenue.
On top of that there’s the brand equity your company gains simply by having a well-known big business as a client. Being able to put a logo on your homepage that people recognise has major value in terms of social proof and it means you won’t have to lean so heavily on “featured in Mashable, Social Media Examiner, Entrepreneur” to prove your worth.
Along with these benefits come some major challenges of course. At enterprise companies, there are more tiers and layers to management structures, so the process of obtaining final approval for your proposals can be long and cumbersome, resulting in deals wilting in your sales pipeline. Because of the elongated sales cycles involved, you may not even be talking to the proper decision-maker for the bulk of your communication with the enterprise.
The paperwork can be burdensome, and the division of labor can be confusing. One study reported by Fast Company found that half of all enterprise employees are a bit unclear on the specifics of the roles they play in their companies. This can mean it’s difficult to know if you’re speaking to someone with the power to make a purchasing decision.
In sum the enterprise selling approach is an entirely different endeavor from what you might be used to; it often involves numerous follow-up sales emails and not just relying on Intercom to convert leads into deals. So what do you need to know when nurturing relationships and selling software to enterprises? And what are the best strategies for better supporting and converting enterprise customers?
You’ll find out next…
Make ROI the focus of all discussions
Because enterprise organisations are beasts flush with more organisational tiers and paperwork and tracking than you’re used to, the most certain way to get something in front of the proper decision-maker is to repeatedly make the bold case for high returns from your technology – in other words, cut the fluff.
Some individuals within enterprise companies might respond and buy on emotion, but companies are usually structured around silos with each division or department facing constant scrutiny from the people holding the purse strings, and there will likely be very few impromptu purchases. You might even need approval from someone with whom you never directly interact, so you can’t rely as much on those personal LinkedIn connections that are so effective when closing deals with small businesses or end consumers.
Make sure that your proposal and all of the materials you send over to the client support the argument that your product or service will make them money. Keep it simple. Describe the problem they need to solve. Explain how your solution addresses their pain points. Lay down the costs involved as well as the savings or profits that will be unlocked by adopting your solution. If you can successfully make an effective projection of ROI, you’ll often land the deal.
1) Calculators. Our free online break-even and profit calculators use industry data and they have enabled enterprise customers to understand what sort of ROI they can expect from using Leadfeeder. The big benefit is that enterprise prospects can play around with the data themselves.
2) Case studies. Sending over case studies that clearly demonstrate how a fellow enterprise customer has achieved ROI and the steps they have taken is one of the most effective ways to demonstrate your SaaS tech’s effectiveness. We’ve found that enterprise decision-makers don’t particularly enjoy hunting down information and therefore sending case studies removes the friction from this process.
3) PDFs of best practices. It’s easy to have your perfect pitch or description of best practices get lost on its journey to the decision-maker, particularly if you’ve pitched to someone over the phone – plus there’s no guarantee they’ll check out your public support site for answers. Sending a PDF adds to the personal touch that many enterprises are looking for and puts strategy ideas on a plate for your enterprise customer.
Consider the investments you’ll need to make (and sometimes go the extra mile)
What kind of expectations does your prospect have about building a relationship with you? Will you need to cross the country a few times for in-person meetings? Will you need to invest in mockup treatments or proofs-of-concept to wow them with a taste of what they’ll get when they sign?
Whatever it is, consider that you may need to dedicate a lot of time, internal talent resources and budget towards each enterprise lead.
This more traditional type of nurturing is a far cry from the largely self-service decision-making that people do in the small business world, where products are more modular. With enterprise, there’s so much customisation at play that even running a demo requires some investment on your part.
When planning out the life cycle of your enterprise leads, keep these investments in mind and make sure your pricing model takes them into account. To ensure your enterprise customer acquisition costs are sustainable, you’ll also need to have a solid grasp of your product costs and your average lifetime value (LTV) on accounts.
4) Additional training. Enterprise customers are a different breed and there’s a lot more resting on their adoption of your SaaS tool. Often quite a bit of extra work is involved in getting your SaaS successfully integrated into their toolstack, which is why it’s important to give extra time to enterprises. We’ve seen that trainings radically increase the conversion rate to Premium and the secondary payoff from successful enterprise onboarding is higher lifetime value.
5) Customer success (post-sales) pipeline. Unlike SMEs the success of your tool won’t just take care of itself and that’s why we’ve set up a customer success pipeline in Pipedrive to work more closely with enterprise clients. In practice it means more regular check-ups for enterprise accounts according to a pre-set schedule and it also means tracking existing customers with Leadfeeder and Intercom so we understand more about their activity, behaviour and interests.
6) Gifts. The monetary investment in the likes of t-shirts and postcards to send to your customers doesn’t need to significant and it represents a very good return on investment. It pays to develop a more personalised and human-centric relationship with your customers because a decision-maker who feels valued is more likely to use your service for longer and tell others about it.
Realise that each enterprise is actually many clients
Simply thanks to the existence of so many middle management layers in enterprise companies, it often feels like you’re jumping through lots of hoops and restating your value proposition to many different people. All the while, you still don’t have the deal. This is natural when selling to enterprise.
You can take a cynical view and realise that enterprise companies can become bloated, and when companies become bloated, different managers set out to assert their authority by jumping in to evaluate each and every deal. There’s probably more than a tiny amount of truth to that, but the fact of the matter is, you need to deal with it.
At an SMB, you can pitch one person, have it go well, and have a deal 90 minutes later. It’s not going to be like that with an enterprise company. Just keep plugging away at it, all while conveying your value to win over everyone necessary.
7) Figure out who makes the decision. It’s really important to speak to the key decision-maker or at least find out who’ll make the purchasing decision, because it allows you to prepare appropriate materials and tailor your pitch with their evaluation criteria in mind. If the buyer’s evaluation criteria is asking for another end user’s appraisal (a potential champion) then we always try to open a direct line to that person.
8) Understand the purchasing evaluation process. This is inextricably linked to figuring out who’ll make the purchasing decision and generally takes a phone call, training or email back and forth to be clearly established. It’s important to remember that people are loss averse and tend to stick to the status quo; as the old saying goes “no one ever got fired for buying IBM”.
One tactic that’s worked well for Leadfeeder is working closely with the sales guys who are the end users of Leadfeeder. While it might be the marketing manager who makes the purchasing decision, we know that very often they will consult their sales team before deciding. Because of this we work closely with sales people to ensure they’re achieving their aims with Leadfeeder. By understanding more about the purchasing evaluation process, which often includes understanding how your SaaS product fits into an enterprise company’s existing toolstack, you’ll be able to show how your enterprise prospect will be able to achieve the return they’re looking for.
9) Establish a personal relationship with champions and buyers. One best practice that we’ve developed for nurturing relationships alongside the more conventional trainings, Intercom chats and email is being active with people on LinkedIn and other channels. We’ve written a guide to selling on LinkedIn here. There’s plenty of hard evidence to show that salespeople need to be present online where their customers spend time and to achieve that we add leads in Sales Navigator and nurture using Twitter.
Selling to enterprise clients isn’t just about using the best selling strategies, it’s also about product development with enterprise sales in mind. Here are 7 important things that have been requested by enterprise accounts – which makes selling to large companies a lot easier:
Single sign on. Letting users sign in with Google Apps or company credentials reduces administration effort.
Audit logging. Very often big organisations will want or require the ability to run internal investigations, so being able to see a log of who made every change to every record, and sometimes who viewed each record, is something that will comply with this.
Fine-grained permission controls. While startups are small teams where everyone can be trusted with more access, the principle in big organisations is usually to limit everything to the barest minimum each employee needs, so that if credentials get lost or phished (which is a bigger risk in larger organisations, just due to scale), less harm can be done.
Security best practices. In our case we will just keep doing what we are doing, but in addition publish the fact that we encrypt everything at rest and in transit on our website. Some other good practices might be offering two-factor authentication, using automated vulnerability testing and paying for external penetration testing.
Accessibility standards compliance. Bigger companies and near-enough all public sector bodies will have a policy stating that they only use technology they assess to be accessible to users with disabilities. Typically, they do this using criteria like the W3C’s Web Content Accessibility Guidelines.
Change management. Product changes sometimes cause unforeseen problems for bigger firms that are more settled into a specific way of working, and slower to adapt. Giving enterprise customers control over releasing new features to their users allows this to be well-controlled, and allows companies to ensure staff are appropriately trained in- and prepared for the new features.
“Enterprise SLA”. When large companies with lots of users start to rely on a product, the effect of a small amount of downtime is multiplied. If people check a product for 10 minutes per day, a startup with two users will lose 20 minutes of productive time if they can’t use a product for half a day, whereas an organisation with a 200-strong sales team will lose the equivalent of 33 hours of work time. For this reason, guaranteeing, for example, 99.9% availability up to about an hour offline per month, minimises the likelihood that this is seen as a danger by potential enterprise buyers.
There are challenges to selling to enterprise leads, for sure. Many of them involve time and the concerns you’ll have that you’re not making enough revenue as you wait for a final decision from the enterprise’s various stakeholders.
Many of those challenges, however, are more than significantly outweighed by the potential benefits when you hook the “big fish.” Keep thinking about the impact that these deals can have on your bottom line, on your own branding and on your client retention strategies. Keep at it and approach these leads accordingly. It’ll pay off.
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