How to Get Customers to the Cloud and How to Keep Them

Choose a proper segment, touch the audience with your proposal and work on leads. This is a classical scheme of the sales process. Before I joined the Cloud business, I used this simple procedure a lot of times.

A more advanced step is to work precisely with a customer who bought your product in the past and to propose them a new version of your product. 3 years after I bought my car, the dealer started calling me every 6 months offering new models. It would be perfect for my car dealer, if my vehicle stopped working exactly 3 years after I bought it. In that case, he could reach me just once.

If your product is a time-limited subscription (e.g. car insurance or IT technical outsourcing), the successful renewal is the key part of success. It is much cheaper to renew a subscription than to find a new customer. This idea is so clear, that companies try to sell their standard products in the form of a subscription. For example, at the beginning, Microsoft launched a new version and started selling it. A customer could pay for an upgrade or use the old version. Microsoft needed to sell it every time after the launch and explain why a new product cost new money. Later, Microsoft set up a 3-year subscription when customers could use any version of the products, and Microsoft needed to renew the subscription once in 3 years. If a customer does not renew it, they cannot use any products. Subscription renewal is always easier to sell than an upgrade.

But how does it work for the Cloud?

The most complicated and important step is the first purchase– starting using the Cloud infrastructure instead of its own for the first time. You need to help your customers to change their way of thinking and the most difficult is the first selling.

Ok, the customer has bought his first Cloud, what is the renewal time? When should the sales team come back again?

Is that the moment when the next payment is due? Definitely not, as most customers pay every month as they do so for electricity.

Maybe it is the moment when the next version comes out? Unlikely so, as adding new features to the Cloud is an ongoing process without bright launches.

Or, perhaps, there is no need to work deeply with the existing Cloud customers since electric power companies or internet providers do not do it.

These questions above are not easy to answer.

Selling Cloud is selling consistently of the two ideas:

1. The general idea of outsourcing (rent, not buy)
2. The different scenarios of usage (how and where the Cloud could save money).

The first idea is the most crucial and difficult one. The second is more technical and based on experience and database collected with previous customers. So, in the Cloud the sales process does not run from a launch of a new version to a launch of the next one, and not from initial sale to renewals, but through consistent sales of multiple scenarios of usage after the customer made a choice in favor of the Cloud.

As a result, the Cloud Sales Team should be organized accordingly. When I started working for a Cloud provider I had just one Sales team. The same people were responsible for pre-sale, for customers activation (migration, etc.), for supporting customers with not-technical issues and for upsell. Good for a start-up, but not optimal for a bigger business. It is hard work to find good sellers for Cloud services who could change clients’ way of thinking (see my separate text about hiring), and if you find them, you want them to bring new customers and not to draw their attention to other things .

For the majority of the Cloud services I recommend to divide sales-process into three blocks:

1. New customers acquisition. You need here hunters who bring new clients.
2. Customer activation. Implementation of any first scenario of usage. You need somebody who looks like an experienced project manager to help customers pass this stage faster .
3. Constant Upsell. Customers’ consumption growth is about 30% per year, and it is stupid not to grow it properly. You need here attentive and trustful advisers who will help customers to succeed with your Cloud.

In our globalization time, it is also possible to benefit from smart geo distribution of these teams. Indeed, hunters need to be near customers, all other could be placed in areas with chipper labor cost.

It is amazing, how the Cloud is different from other areas in IT. Different motivation, different scorecard, different types of people are good here. Do not hesitate to take ideas from competitors, but look more not at hardware or software business, but at service providers. For example, I stole ideas mostly from telecom operators. They are older brothers for the Cloud!