Insight: SaaS (8) Build a Sales team
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We discussed the L2C sales process in the previous article ‘Insight: SaaS(7) Standardize the sales process’. From Leads to Cash, each SaaS company defines its own stages. Let’s talk about the sales team in this article.
In terms of defining a company’s sales team, I contend it is the group in charge of the conversion from MQL to Win. The duty of sales is to convert MQL customers into our new MRR/ARR customers. They are responsible for the number of New ARRs and the MQL to Win conversion rate. MQL to SQL, SQL to SAL (Sales Accepted Leads), and SAL to Win are the steps in the decomposition of MQL to Win. The concepts of SAL and SQL are somewhat repetitive and can be ignored in day-to-day operations. In MQL, the marketing department has approved some leads, but the sales department considers that none of them are qualified, and they need to be screened out so that the time is not wasted. The Sales team’s main task is to convert SQL to Win.
(MQL / SQL definitions are introduced in the last article ‘Insight: SaaS(7) Standardize the sales process’.)
Tier the customer group
Any sales transaction necessitates a basic understanding of the customer. If your SaaS company offers three different levels of SaaS plans, such as Pro, Team, and Enterprise, you won’t be able to use the same sales team to deal with three different types of customers. It’s natural to grade products, but you also need to grade your customers. Different customers purchase products that are related to each other. It’s a common practice to rank customers based on the number of employees they have. SMB: 20–100, Mid Market: 100–1000, Enterprise> 1000, VSB≤20. Your product should have a Pro version for VSB and a Team version for SMB/Mid Market. The Enterprise version is for Enterprise.
The price should match the customer type
Most SaaS products have an ACV(Annual Contract Value) that corresponds to the size of their customers. Your target customer should be VSB or SMB if your ACV is $2400. Customers in the midmarket and enterprise are not covered by your service. If your product is developed for Enterprise and the price is less than $5000, you should raise the price of your product.
The dominant sales channel should match the price.
No-touch / Self-service is a sales method with the lowest sales cost, in which no sales staff is involved in the sales process. When the product becomes more complex, sales staff must engage to assist customers. Inside sales refer to closing sales in the office, whereas Field sales refer to meeting with customers to make a deal. Channel is a more complicated one. Products are sold through other partner companies rather than through direct sales. Mixed sales refer to a combination of different sales methods, such as inside and field participation. Only a small percentage of SaaS companies can sell products with an ACV of more than $5,000 through No-touch / Self-service. These SaaS companies are known for their clear product positioning, lack of an onboarding process, and high sales efficiency.
Similarly, the sales team’s title corresponds to customer types, sales methods, and ACV.
1. Self-service/Self-educated — — VSB
Customers understand, purchase, and use the product on their own.
2. AE(Account Executive) — — SMB / Midmarket (Online Sales)
Receives a SQL and schedules a discovery call
Performs a diagnose, and offers a demo
Provides the customer with valuable insights
Helps the customer in making a decision
Carries out the paperwork
Schedules the onboarding call
Transitions the customer to the CSM
The AE is held accountable for the contract value, win ratio, sales cycle, contract terms, and payment terms throughout the entire process.
Creates a top-50 target list (goes to SDR)
3. FAE(Field Account Executive) — — Enterprise (Enterprise Sales/Field Sales)
Receives an SQL and schedules a discovery call
Perform a diagnosis of the client’s problem and an assessment of the client’s suitability for the proposed solution.
Identifies the symptoms and consequences
Understand the customers purchasing process
Gains insight on the departments and people involved
Establishes the corporate goals
Assists customers with their purchasing decisions by providing valuable insights; this may include onsite support to perform demonstrations and gain additional insights.
Assists the customer through the purchasing process
Make a deal
Transitions the customer to the CSM
4. MDR(Marketing Development Representative): Inbound Lead Development and Qualification
Receives requests from clients who want more information (MQLs)
Stack prioritizes MQLs, and hot ones are identified using skills and tools.
Researches the clients and contacts them ASAP
Qualify customers
Qualified clients (SQLs) are assigned to FAEs (Enterprise), AEs (SMB), or Self-Service
Disqualified clients are labeled, and some may be returned to nurturing (or Self-Service)
5. SDR(Sales Development Representative): Outbound Lead Generation
Develops SQLs from a top 50 list (AE provided)
Finds entry points: a new target market from management
Researches and identifies qualified targets
Engages in in-depth conversations with customers via email, phone, and chats to better understand their needs.
Qualifies customers based on fit
Qualified leads are assigned to an FAE/AE
Disqualified clients are labeled, and some may be returned to nurturing (or Self-Service)
The collaboration of these roles is depicted in the graph below.
Do you complete these actions under the rules when your salespeople interact with customers? FAE, for example, greets customers, introduces products, discovers needs, submits plans, communicates in detail, and submits prices… FAE must have access to the customer information that the previous Marketing department, SDR, and MDR have, and must refrain from asking customers the same questions over and over.
These actions require a unified training strategy as well as ongoing optimization. To make the Sales team more effective as a whole, the company should encourage those who perform well to output their own speaking skills and standardize them. A great sales team has a basic indicator that most people get B degrees, and top salespeople can get A or even better. The founder created the first sales ‘template’ and made the first few sales. You can only conduct training after you standardize your sales play, and recruit more people into your team. Instead of being picked up, a combat-effective team is trained. You can read the article ‘Insight: SaaS(7) Standardize the sales process’ for more information on standardizing the sales process.
The next article ‘Insight: SaaS (9) Marketing’ is published. Simply send me some claps and feedback if you enjoyed my article.
