SaaS Sales (2): Setting Up A Sales Process For Predictable Revenue
Predictable Revenue is key to company growth. Although many companies may struggle with structuring their sales process in a way that will product predictable results, this post will addresses specific challenges for early stage SaaS startups.
An early-stage startup usually acquires its first customers from the leads generated through the founder’s personal network. In a very early stage startup founders are commonly leveraging their networks by asking contacts to provide feedback on a beta-product.
Asking for feedback creates a different client relationship. Because it’s a personal connection the feeling is fuzzy, as (s)he is helping out an underdog (the startup in this case). The friendly relationship can backfire as it may not accurately reflectfeedback from actual customers. These customers are not close to you, the founder, therefore will only focus on the value from the product for the client relationship.
Many founders are able to deal with this properly and will close the first deals. Once some initial traction is found, the first business cases are built and a referral is obtained, the nature of sales changes. The mode of thinking goes from ‘obtaining feedback’ to testing the scalability of the value proposition that had some initial traction.
The sweet ‘please help a startup’ approach changes to ‘are you interested in benefits from my service?’. At this phase of the startup it is important to start working on a structured and scalable sales process as soon as possible, as the product has to be sellable by other people than the founders.
Much of what I’m about to write is entirely based on the ‘Predictable Revenue’ methodology. The reason I made the effort to write this is to provide a complete view on the SaaS sales process in the ‘SaaS Startup Sales’ series. The Predictable Revenue methodology provides an excellent framework to structure your startup sales process.
The Predictable Revenue (‘PR’) sales process, first pioneered by salesforce, is based on creating a different role for every sales stage. A generic sales process basically consists of 3 stages and 4 roles.
Lead generation
The key objective for reps in lead generation is to discover whether a lead is the right fit. Instead of a ‘pushy’ sales approach, the leadgen reps determines if the lead matches your clients criteria, and has the need for your product. The Lead Gen Reps basically separate the bad leads from the good ones, so your Account Executives don’t spend time trying to close bad leads in a later phase. This phase requires an investigative mindset. The Lead Generation stage defines two roles.
Inbound — Market Response Rep
The Market Response Rep qualifies incoming leads according to lead criteria and determines whether a lead is a good fit for the service or product. In an early-stage startup you don’t have a name yet, let alone traffic to your site, so you probably won’t get a whole lot of inbound leads.
Outbound — Sales Development Rep
The Sales Development Rep (SDR) is one of the most important roles in an early-stage startup, as this person will be testing and validating the initial value proposition. The SDR sets up outbound lead gen (“outreach”) campaigns — commonly through messaging prospects (a prospect is a potential lead). Outreach campaigns can go through many different channels, such as social media, phone and email. The old PR-methodology initially suggested that the SDR should reach out to about 50 prospects per day. When the PR-methodology was pioneered outreach consisted mostly of identification and contacting prospects via email and personal messages. With Sales Email Automation (SEA) this can be scaled dramatically.
Some founders are concerned with losing the personal touch in approaching customers, however many SEA systems provide opportunities to ‘personalize’ messages. The key here is in building Databases with a variety of different variables and with ‘snippets’ of personal messages. How to setup a campaign will be discussed in a later post.
Closing
After the lead has been qualified in an initial phone call, the lead is qualified as an ‘opportunity’ and transferred to the Account Executive (AE). The AE will take the process all the way to the closing and steps include demo’s, face-to-face meetings, pilot, negotiation and the close. The Account Executive is probably more likely to fit the stereotype of a salesperson. Negotiation, convincing customers, addressing their objections, Always-Be-Closing probably holds more in this process.
Founders should focus on closing, whereas the lead generation can be done by a sales employee. Closing the deal requires enthusiasm and the ability to convince, and as the founder your passion for your solution will be a great asset. It is recommendable that, untill you have a validated and scalable value proposition, that the founder focuses on this stage.
Customer Success
After you’ve celebrate the success of the first customer going through the entire sales process, work is not done. Make sure your Customer Success Rep follows up with customers regularly to make sure the client is getting the full benefit. This role is required to minimize the churn of customers, and increase the ‘stickiness’ factor of your product / service.
This introduction to Predictable Revenue covers the basics of the sales process for SaaS startups. In an earlier post I wrote about 5 general ways to optimize email outreach. Now you know about the structure of the sales process I’ll go deeper into how to setup a Sales Automation campaign, specific ways to optimize email outreach and different Sales Automation systems on the market.
I could recommend any startup founder to read the ‘Predictable Revenue’ book as this will provide even more insights into the combination between sales and marketing roles in lead generation. I’m looking forward to hear your feedback on this and later posts. Enjoy the read!
This post originally appeared on The Upstart.
