2 things that changed inside sales forever
Long time no post! Things have been busy and work has started on an e-book. Here is an excerpt from the upcoming e-book, watch the space!!
How the internet changed selling
The first real revolution that changed sales forever was the internet. Before the internet, sales individuals held the power of product knowledge and market knowledge. Google and other search engines changed that. Your buyers are more informed, know their options and above all know who your competition is.
Imagine a car salesman before the advent of the internet. The car salesman knew exactly what model had what and you would need to go to him if you had any questions on the car. Not only did the car salesman have the last say in the world of cars, he was also the go to person if you needed to pick the best model for your needs. Not to mention, the car salesman was also the person who could get you a good deal on the car.
Fast forward to 2018, you can go to a car website, chose the needs you want fulfilled and click on the button to select the model you need. But there is more, the website will typically show you 3 competing car models that also meet your requirements. The car website just saved you the trouble of going to other car showrooms to find the car of your choice.
Armed with this knowledge, you can make the life of a car salesman very difficult indeed. Turn this scenario around where you are the seller and your buyers have done the research.
Your buyers are more empowered, know their options and even get an idea of the pricing they can get. They are more than comfortable dropping names of your competition and demand they get maximum value for their buck!
To spell out what you the sales individual is thinking right now, “it’s very hard to bullshit my prospects!” and you are right!
The internet has made it almost impossible to bullshit or sweet talk your way to a deal. Unless your prospects decide to not look at another option, there is no bullshitting them. Options and pricing are quite literally at their fingertips.
How SaaS changed selling
Before SaaS, the only thing that was closest to a subscription was an AMC (annual maintenance contract). You basically made a large chunk of money upfront as a sales individual and then reached out to your customer a few months before the 1st year ran out. The purpose of the outreach was to basically tell your prospect their hardware/software will be running out of ‘warranty’. Unless your customer had in-house expertise, he would renew.
The concept of customer success was rudimentary and non-existent compared to it’s current avatar. As a sales individual, your role was restricted to selling the product and moving to the next target. A true ‘hunter’ role in the typical sense. The only problem was, in most cases you would end up asking your customers an inordinate amount of money upfront. This made selling expensive software or expensive hardware extremely challenging.
To name a few of these challenges:
a) The last piece of software/hardware had cost them a packet. Now paying the same or even more money for an upgrade/new product is not an ideal situation to be in.
b) The concept of legacy systems existed and made it harder for a sales individual to sell his wares. Switching to the latest offering meant multiple upgrades before. Remember upgrading your PC to the latest Windows? Going from Windows 7 to Windows 10 is a challenge even today.
c) Because most changes were radical (as opposed to incremental in the case of a SaaS product), some decisions were organization level decision affecting multiple teams which made it harder to sell your software/hardware.
Enter SaaS. Saas made it easier for large organizations to invest in a product. Not only did the product get updated on a regular basis (in most cases silently), the software would only work if you paid the subscription fees. Which meant that if the product offered value, the renewal was a given.
What changed for the sales individual with the advent of SaaS?
A sales individual could ask their prospects to start small and upgrade as their usage expanded. Not to mention, a clear majority of SaaS software offer both monthly and annual billing options.
Without realizing it, sales individuals now had a very powerful tool (a double edged one) at their disposal. They could ask their prospects to start on monthly billing and once they were convinced with the product’s capabilities, they can switch to annual billing at any time. The downside of this was that if the product failed to deliver as promised, the customer could exit the product at any time. Organisations are now forced to deliver a continuous stream of value to keep their product relevant and show value.
Because of the above two things. The decision-making process was much faster and simpler. Larger organizations usually distribute budget to their teams. Starting on monthly billing made it easier for teams to start on their own budget, as opposed to going to finance, CTO and CXO’s for approval!
The question to ask is, what is the next big thing in sales? Feel free to share your thoughts on this topic!