Understand how to win at software sales, get to know the various SaaS sales models, selling tips and much more in this sales guide.
Odds are that even if you didn’t know what SaaS stands for, you’ve definitely at least engaged with one SaaS company in your lifetime. Google, Microsoft, Zoom, Hubspot, Salesforce, Dropbox, Contractbook … think software, and you’ve got yourself an SaaS company.
SaaS stands for Software as a Service, and that is exactly what all these (and other) companies do. SaaS companies create, host, and sell web-based services online. It is no small game either – in fact, Gartner estimates that by 2021, the SaaS market opportunity will stand at a whopping $85 billion, representing the biggest segment of the market for cloud services.
There is no time like the present for being a part of SaaS’s astronomical growth journey. However, burgeoning competition in the industry means that the role of sales will become increasingly key to success. Here is a helpful sales guide to help you understand how to win at software sales, along with the various SaaS sales models, selling tips, and much more.
Since SaaS sales involve selling web-based software to customers, it is a little different than selling a physical product in a store (or even online/on a b2b platform).
Typically, software companies rely more heavily on inbound marketing to increase sales, making use of digital marketing and online advertising to bring in interested leads. Marketing teams then work to transform these into qualified prospects, at which point the sales team reaches out to convert them into customers.
Since not every lead may be interested in becoming a customer right away, this tends to be a long drawn out process with multiple touch points. It requires heavy investment into marketing as well as customer relationship management platforms, both of which help to manage the pipeline more effectively.
What is more - sales reps need to be both, knowledgeable about the software, as well as have a deep understanding of the customer so that they can communicate the specific benefits that might interest them.
With respect to this, an important element is the personalisation of communication. Unlike traditional sales in which customers are actively seeking out a product, SaaS companies mostly try to lure customers in by displaying the benefits and features of their products. Since each prospect may have different needs, personalisation is key to closing customers.
Much of your success in SaaS sales depends on the sales model you choose – after all, depending on what your target market needs, you might have a harder time convincing customers to purchase your software if you do not get your pitch right.
Most software companies adopt one or a hybrid of the three primary SaaS sales strategies, which we will explain with the help of examples:
This strategy places the onus of sales on the marketing team, relying on them to communicate the product features in a meaningful way to customers. Typically used for low-priced or mass consumer services, this model encourages users to sign up for the service themselves, luring them in with special offers like free trials or freemium subscriptions.
Consider companies like Netflix, Amazon, or Spotify, which invite users to purchase the service, without needing a dedicated sales team. These are examples of the self-service model in action.
As the price of the service increases, customers become increasingly hesitant to purchase it. This is where sales teams come in useful to help customers see the value in purchasing the software. This model places equal importance on the roles of marketing and sales; marketing – to bring in qualified prospects, and sales – to convert these prospects into customers. Typically, sales reps have a wide variety of content and tools at their disposal to help convert the customer.
Many of the aforementioned companies that rely on the self-service model also have a transactional sales offering. It is a common strategy to shift to the latter, especially as the company expands.
Enterprise sales are the highest risk, highest reward tier of SaaS sales models. Being the most high-ticket products, often with annual contracts and customised solutions, they require multiple dedicated sales teams to coordinate with individual contracts.
Enterprise salespeople typically spend months closing a single contract, after running extensive demonstrations and meeting with senior stakeholders. Because so many crucial elements are involved, sales reps work closely alongside product developers and marketers to deliver detailed product information to clients.
Contractbook, Salesforce, and Dropbox are some examples of enterprise sales companies.
Closing SaaS sales requires effort. Timing, communication, and the art of persuasion all come together to convince your customer that they really need this service. Since they are so different from the usual sales process, there are certain things that you should always remember when it comes to SaaS sales. Here are some useful tips:
There are several resources, both online and offline, that can help you become a better SaaS sales rep. While these are just some helpful tips, you should always continue to read and keep up with the latest innovations that can help you nail down customers, and be the best salesperson you can be!