According to research from Vorsight and Insidesales.com, jobs for inside sales rep’s are growing 15x times faster and than traditional field sales; VentureBeat’s Inside Sales Landscape shows there are 669 sales-related technology start-ups in 2017; and the category of sales acceleration technologies has already pulled in more than $1.2 Billion in VC investments.
Sales methodologies have changed, and ‘Inside Sales’ is trending faster than fidget spinners and the latest Minecraft meme. The trend bodes particularly well for companies looking to expand into international markets, as it lowers up-front risks and costs.
Especially in the technology sector—and even more acutely in sales of SaaS services—the time-honored approach to prospecting, qualifying, and closing sales revenues is morphing radically in response to new workforce demographics, new sales technologies, and new customer expectations.
“Source: VB | Profiles”
What does the inside sales trend mean for CEOs and CROs, and what should your sales organization be doing about it? Here are 4 drivers that explain the inside sales trend, and that your sales management exec’s need to understand right now.
1) Sales closing cycles are accelerating: While large enterprise deals in the past might have required 6-12 months from to courting-and-close, a well-oiled inside sales team might do the same in 30-90 days. How?
– Forget getting on an airplane and instead use inside sales to increase the velocity of sales processes. Especially with SaaS products, it’s not about getting 10 meetings per week anymore. It’s about giving prospects the tools and information to qualify themselves at your website, and then answering whatever questions remain so that they feel comfortable moving forward with a free trial or paid pilot.
– Inside sales processes better optimize the handoff from marketing to sales. According to research from HubSpot, at least 44% of inside sales’ pipeline typically comes from marketing, and marketing automation tools allow those better quality leads by analyzing and fine-tuning a larger volume of prospects at the top of the funnel.
– Try rapid iterations in your high-velocity sales approach, and double-down on channels and techniques that are gaining the traction. Start by creating buyer ‘personas’ of your ideal customer and then gather whatever data you can to analyze the buyer journey and decision psychology. Using a more data-driven approach, instead of relying on the ‘gut’ of your best sales reps can increase sales volume and lower your sales costs.
– And finally, make it painless (or automatic) to schedule a meeting or demo by using free online tools like Calendly or Doodle. Remember also to make it easy to sign the contract! HelloSign and Docusign can help there.
2) Workplaces are now global: Companies operate in a global context and target prospects can procure from anywhere. Inside sales teams can be located in any country.
– Connected technologies have created a global marketplace and workplaces where colleagues can be sitting in different parts of the world yet still collaborate effectively. Video messaging apps let people have a face-to-face experience with anyone, without leaving the office.
– Likewise, sales people can be hired anywhere in the world—to localize inside sales processes to suit local cultures, and to call on prospects in their time zones to provide support and that final push.
3) SaaS and Services are proliferating: Mega-$$$ enterprise software deployments are fewer and fewer, replaced by SaaS services and monthly subscriptions. Front-loaded field sales processes are too expensive and risky for these types of deals.
– Subscriptions services can be found everywhere now, from your dinner meal delivered at home to your e-mail host at work. The proliferation of SaaS technologies has matured beyond hosting and storage and security, and is now driving the rise of inside sales as the SaaS mentality and technology is finding its way into marketing and sales processes.
– Along with inside sales processes, sales compensation models for SaaS products should be calculated based on lifetime value of the deal (expressed as MRR or ARR or TCV) versus price.
– This influx of SaaS technologies and on-demand services is driving the trend to measure and optimize everything, including sales processes.
4) Workforce demographics are changing: Your target buyer is likely a Millennial who is not interested in having lunch and more likely to respond to inside sales’ self-help product materials and marketing’s digital funnel campaigns.
– A sea change is happening in the demographic of tech buyers and tech salespersons. Millennials already dominate the workforces in the majority of technology companies, and GenZ is entering now. These new workers have already impacted everything from HR policies to office food choices, and they are a major force behind the inside sales trend as well.
By using modern inside sales methodologies, companies can capitalize on these trends and lower their overall cost of sales. In particular, companies can reduce the risks and costs of sales expansion into new markets and geographies like Europe.
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SFE is a pioneer of the Sales-as-a-Service model, starting in 2003. More than 200 enterprises have trusted SFE to expand their sales into Europe and other international regions using our acclaimed Accelerated Sales Platform. Our Platform includes Accelerated Market Analysis, Accelerated Lead-Gen, and Accelerated Sales modules, which can be delivered as an integrated service or as stand-alone modules.
If your company is looking for the latest sales methodologies to reach enterprises and channels throughout Europe, SFE can help you. Let’s talk. –Rick
We are proud to announce that publicly traded telecommunications giant Swisscom has officially signed a strategic partnership agreement with SFE!
SFE’s international reputation and successful track record were key to winning the partnership deal. In particular, SFE has specialized in international channel development and technology sales since 2001.
The strategic partnership with Swisscom is focused on two important collaborations:
- SFE will help Swisscom identify interesting technology innovations and productize them for OEMs and Reseller channels in their home market in Switzerland;
- SFE will help Swisscom to commercialize selected innovations for international markets.
Swisscom is a major telecom player in Europe; in addition to Swisscom’s residential mobile network, which has more than 6.6 million customers, the company operates a broadband network for businesses, a digital TV service, and operates a subsidiary broadband network in Italy known as Fastweb.
Swisscom aspires to offer its customers the very best in today’s networked world. As an exemplary company offering digitisation solutions, Swisscom lets people choose flexibly how to interact, work and live. As a technology partner, Swisscom helps companies improve their products, processes and marketing and, in doing so, remain competitive. The company thereby strengthen and promote all of Switzerland as a business location.
April 24, 2017
This data comes from IHS Markit Ltd. (Nasdaq: INFO) Purchasing Managers’ Index (PMI) monthly survey of 30 countries. PMI survey data is closely watched by central banks and financial markets worldwide.
Despite the lingering effects of the Greek debt crisis from 2015 and the surprise Brexit vote of 2016, could the European Union GDP nonetheless be pulling ahead of the US economy?
As another data point, the Q1 2017 European Scaleups Report from the Antwerp Management School documented 466 VC funding deals totaling €3.8 Billion in Q1 alone, an 11% increase in deal volume from the same period last year. France, Germany, UK and Sweden led the pack with the most deals. And last year, Spotify broke records and impressed everyone with a €1.3 Billion capital raise.
Importantly, the study counted only VC fundings larger than 1Million Euro, so the €3.8 Billion figure doesn’t even include the thousands of incubator deals, friends and family rounds, and seed investments that precede institutional VC investments.
What do these trends mean for VCs, CEOs and CROs of US technology companies looking to grow their revenue base via global expansion?
Economic growth attracts investors’ attention and dollars (or Euros, or…) and keeps their focus. Germany is currently the top-growing country in the EU, followed by Ireland, Spain and France. Italy’s GDP output slowed a bit and is currently lagging the EU average. Global investors and traders usually move their money into the stock markets of countries where overall economic growth is already evident or anticipated, because an increase in the overall economy translates to good news for constituent corporations and their stock prices. Rising revenues and stock prices for these publicly traded companies means a healthy budget for technology investments and purchases from companies like yours.
In a nutshell, the healthy fund-raising environment in Europe shows investor confidence and maturation in the tech ecosystem, and the rising Composite Index scores means that Europe is a good place for American tech companies to sell their software and products. European companies are buying.
Here at SFE, we have engaged with more than 200 clients selling their technology products to enterprises in 28 different countries within the EU. Depending on what metrics you follow, we believe the economies of EU versus USA will continue to trade places for the lead—which is a good thing. What this neck-and-neck race means for US and EU tech companies is sustained investor attention, and an economic environment that continues to be ideal for expanding sales internationally (both US-to-EU and country-to-country within the EU). Trade fluctuations on either side of the Atlantic may cause short-term index gains in one region over another, but the long-term trend is that both EU and USA economies are winners.
SFE is a pioneer of the sales-as-a-service model, starting in 2003. More than 200 enterprises have trusted SFE to expand their sales into Europe and other international regions using our Accelerated Sales Platform. Our Platform includes Accelerated Market Analysis, Accelerated Lead-Gen, and Accelerated Sales modules, which can be delivered as an integrated service or as stand-alone modules.
Our platform is deployed through our international team of 75+ Sales Professionals who represent your brand in-country/language, blend into your company culture, and use their local market knowledge and sales contacts to make revenues and ROI manifest quickly.
If your company is interested in setting up channel sales or selling direct to enterprises in Europe, SFE can help you so let’s talk.
April 5, 2017
In our previous post, we offered ‘4 Best Practices’ for how to sell SaaS technology products to enterprises throughout Europe—from choosing the right country as your entry point, to how to act like a local in each territory. In this post, we’ll talk about how to hire and manage the sales teams to deliver stellar results.
Sales teams that are accustomed to typical software license deals often take an expenses-be-damned approach to making the sale. However, a SaaS license does not generate the same kind of up-front fees, so a more measured approach is needed to keep customer acquisition costs in line with revenue ramp-up. Below we talk about how to build the right sales team to go after SaaS sales, and how to keep them motivated.
Identifying the Right Talent
Sales teams are usually built either from the bottom-up or from the top-down. Bottoms-up teams hire young account managers and promote from within; top-down teams find a VP of Sales who then attracts a senior team around them.
Hiring large teams of entry-level reps tends to be expensive-per-dollar-booked, because each rep books a smaller quota. Less senior teams also require more training. On the other hand, you can recruit a top VP of Sales who will bring with them a team of senior account exec’s and a spreadsheet of enterprise buyer relationships—but they will be more expensive.
The SaaS business model is a relatively new invention (from the late 90s), so if you can find an experienced VP of Sales who knows SaaS, hire them! That said, it’s rare for a startup to have the resources to attract such an experienced sales executive, in particular when launching in foreign markets.
Setting Commission Expectations
Because SaaS products are sold on a subscription model, the value of a deal is difficult to measure up front and therefore your justified cost-per lead and cost-per-acquisition is hard to nail down as well. You need to factor in sales, the sales cycle time, renewal rates, and other factors that are beyond the control of the initial salesperson.
Due to the opacity in the up-front value of the SaaS sale, it’s equally imprecise to put an exact value of a sales person’s contribution. A fair and objective formula for compensation is to value the deal based on a formula based on recurring revenue. You might also want to factor in the total acquisition costs and expected lifetime customer value when setting goals.
In addition to gross sales goals, keep in mind that improving the sales conversion rates at any stage of the cycle goes straight to top line revenue. In a high volume sales operation like SaaS sales, you can’t afford to waste time on window shoppers, or custom deployment requirements, or highly competitive bake-offs. Increasing conversion ratios requires sales reps to properly quality opportunities, then provide timely feedback about a prospect’s true level of commitment.
Accelerating Revenue (Leverage Through Marketing)
Successful SaaS sales executives can’t do this alone. Outbound calling and in-the-field meetings can quickly mushroom acquisition costs by sucking up too much sales investment in relation to too little commitment from prospects. Instead, SaaS price points demand that sales teams have a tight working relationship with marketing.
Marketing provides leverage for your sales investments.
By providing leads in bulk (vs. sales reps creating leads one-at-a-time), and automatically (digitally) qualifying and nurturing leads until precisely the point that they are ready to make a decision, sales teams can leverage marketing to scale their own efforts and accelerate their revenues. Clients often implement these marketing strategies in their home markets, but then forget or delay marketing when expanding to new countries, and this creates a huge impediment to success.
For our clients at SFE, we offer an ‘Accelerated Lead-Gen’ module where we take responsibility for finding and qualifying leads for sales, using the latest digital marketing technologies and inbound-marketing techniques.
The skills needed to deliver on a $1 million quota when the average SaaS deal value is just $10K are different from the skills required to land a single $1M deal: your sales reps need the stamina (and support) to deliver 100 deals vs 1.
Public acknowledgement of sales wins, creative perks, and team-building activities can make a big difference in performance—as can ongoing mentoring and coaching. Especially for international sales, sending a team off to figure it out for themselves (even an experienced team) will lead to frustration. Sales staff members need to be backed by quality leads, efficient internal processes, and time and attention from senior management.
Sales as ‘Service Delivery System’
The SaaS software model presumes large scale economies—volume and speed—to make low subscription-based pricing work. Likewise a SaaS sales operation needs to function with an efficiency that can deliver sales within optimal cost parameters. It requires a capable front-line sales team, supported by an efficient marketing process and lead hand-off, and a management infrastructure that can monitor, guide, and mentor.
SFE has honed its SaaS sales experience across 200 companies in 28 different countries, and has developed its ‘Accelerated Sales Delivery’ system to bring those efficiencies to you.
If your SaaS company is considering the daunting challenge of building up sales teams to crack open international markets, please consider the services of SFE.
CEO & Founder
Xeerpa is a Big Data marketing solution that allows brands to explore the social world of each of their customers, fans and followers, by analyzing the information they share across popular social media platforms such as Facebook, Twitter, LinkedIn, Google+, among others.
Unlike other solutions, Xeerpa creates unique profiles for each user, storing them in a database specifically designed to help you personalize your marketing campaigns, increasing ROI and improving customer experience.
DB Pro Oy is a forerunner in Microsoft SQL Server cost optimization. They also specialize in SQL Server platform planning and implementation projects and comprehensive performance optimization. In addition to solid expertise and experience, their strengths include flexibility and speed.
DB Pro Oy takes special pride in Governor® software – a unique product we have developed for the optimization of the capacity of SQL Server platforms. Governor® combines ease of use with efficiency and scalability – from small one-server systems to the largest platforms, with thousands of servers.
Their customer base consists of large and medium-sized companies representing a broad range of industries, such as logistics and trade, manufacturing-based industries, and SaaS software production. Over the years, their satisfied customers have praised DB Pro’s ability to solve their problems and improve the efficiency of their operations.
March 20, 2017
What is the difference between selling SaaS technology in Europe versus North America? Unlike USA, Europe is not one addressable market but 28+ different Countries, so your SaaS sales success boils down to choosing the right geographic rollout and looking and acting like a local in each territory. See below for 4 Best Practices for how to succeed, or shoot me a reply and I can walk you through it.
According to Goldman Sachs research, Software-as-a-Service (SaaS) sales revenue totaled $106 billion globally in 2016. Cisco’s Global Cloud Index forecast estimates SaaS will encompass 59% of total cloud IT workloads by 2018. Within those global figures, North America accounted for more than half of the market (54%); however Europe represents a less saturated market that is potentially a better opportunity depending on the country. SaaS adoption rates vary widely with Finland, for example, seeing SaaS penetration at 51% while Poland is just 6% (figures according to Eurostat).
The original premise for SaaS software was that it is easy to buy: with just a credit card and a few clicks, you can be running sophisticated enterprise applications without any IT involvement or accounting approval cycles. In the previous era of on-premise software, 70% of software sales went through channel distributors (versus only 23% of SaaS sales going through a channel now). But despite its ease of purchase, SaaS software in enterprises rarely ‘sells itself;’ today’s enterprise SaaS vendors rely heavily on direct sales
So what could be so hard about selling SaaS in Europe? Let’s look at those four best practices.
SaaS Best Practice #1: Start With a Global Mind Set
In SaaS sales, it helps to have a global mindset from the very beginning, as it will guide your early decisions in product development, channel strategy, and other core infrastructure. Adopting this global perspective is admittedly more difficult when your company is strong in your home market and your home territory is large. For example, you can afford to be strong in just Germany, or just France or Sweden or U.K., where probably 80% of your first $10 million-or-so of sales is coming from your home territory.
But companies from countries like Israel or Finland have no choice but to sell globally, and the product development choices they make early on pay dividends. To put that into a North American perspective, a U.S. company would never choose to sell into just one State – yet the economy of California or Texas alone is larger than most countries.
Put simply, you will eventually out-grow your home country so start thinking globally right away.
SaaS Best Practice #2: Choose the Right Entry Country
Many U.S. companies choose to enter Europe by setting up an office in the UK, where the language barrier is less acute. While that choice may be logistically easier, UK may not be the best market for your particular product.
Narrowing down the right market-entry country is a strategic decision. Start by doing desk research into which countries your direct and indirect competitors sell, and interview local companies that might be good targets. Then analyze your trade-offs:
- Addressable Market Size: does the country have the potential to be 10x your current market? Or just 1x… or 0.1x?
- Competition: will you be selling against 100 competitors, or just a few?
- Regulations: are you competing in a regulated sector like FinTech? Are some countries an easier fit for your product, even if the addressable market is smaller?
- Difficulty of Replicating Value: what tweaks will be needed to your product to deliver the promised value to your target prospects? Will it take a few weeks to localize some code, or months of new development work? Will you need to radically alter your sales processes and pricing? What will it really cost you to replicate your current value proposition?
Here at SFE, we offer an Accelerated Market Analysis service where we use local domain experts to help you arrive at an optimal country-by-country roll out strategy.
SaaS Best Practice #3: Act Like a Local
U.S. companies often are spoiled to the fact that almost everyone around the world can speak English. But that doesn’t mean you can get away with simply exporting your product and sales processes as-is. European enterprise buyers are skeptical of U.S. companies that aren’t willing to localize their product and related materials to their country, because it doesn’t feel like a long-term relationship. Think of it from a buyer’s perspective: how committed are you to on-going support and product development if you won’t invest a little up front?
Here are four ways to signal that you are a local:
Local Sales Staff: Local sales staff (hired or engaged as a service) have an existing network of in-country buyer contacts — especially important for enterprise sales — but they are also native language speakers who know the subtle cultural cues and nuances that help guide sales to a close. So much of enterprise sales is about trust and perceived commitment to the region.
Localize Your Pricing: When converting prices to the local currency, go beyond just the current exchange rate. Consult with local sales experts about what are natural pricing break points (either perceived barriers or thresholds for expensing vs. capitalizing budgets). And also consider what components are expected to be included versus priced as extra – these expectations differ by country. Also remember to be clear whether your prices include or exclude VAT (Value Added Tax) for European countries, which can be sizable.
Localize Support Materials: Localizing your supporting materials is a matter of degrees. At the simplest level, you should localize your website and domain; next is localizing marketing and sales materials (especially your case studies!), then customer support materials. Remember also, if you offer support services, that you might have to find the people who speak the local languages or contract out to a 3rd party support service. Lastly, you probably do NOT want to localize your legal contracts.
Get a Local Domain:Sure, a .co a .io domain name is pretty universally accepted. But you can show your commitment to a region by getting a .fr, .de, .es top-level domain (TLD). Also set up a local telephone number (Skype-in works well) and a local email drop.
Localizing the product itself depends greatly upon its complexity. Some channel partners might require localization (e.g. SAP might require that you localize for Germany), and in those cases you will want to negotiate for minimum guaranteed sales.
SaaS Best Practice #4: Use SaaS Model for Your Actual Sales:
Just as companies are moving to SaaS services to avoid huge cap-ex investments and risky software deployments, so are companies moving to a Sales-as-a-Service model to reduce the costs and risks of expanding sales. Instead of recruiting international sales teams, entering long-term office lease contracts, and investing hundreds of thousands or even millions of dollars to open a new region before it is even proven, many enterprises are outsourcing (or at least kick-starting) their international sales teams with in-country experts who work as fractional / on-demand resources.
SFE is a pioneer of the sales-as-a-service model, starting in 2001. Already more than 200 enterprises – brands like Adobe, Tivo, Applause and RingCentral — have trusted SFE to expand their sales into Europe and other international regions using our
Accelerated Sales Platform. Our Platform includes Accelerated Market Analysis, Accelerated Lead-Gen, and Accelerated Sales modules, which can be delivered as an integrated service or as stand-alone modules.
Our platform is deployed through our international team of 75+ Sales Professionals who represent your brand in-country/language, blend into your company culture, and use their local market knowledge and sales contacts to make revenues and ROI manifest quickly.
If your SaaS company is eying global sales, let’s talk. –Rick
CEO & Founder
SFE has joined the HubSpot Sales Partner Program to bring the HubSpot software to clients and enterprises throughout Europe.
The HubSpot Sales Partner Program empowers CRM implementation companies and sales consultants to teach a modern inbound sales methodology to match the way modern buyers make purchasing decisions. As a HubSpot Sales Partner, SFE works with a dedicated HubSpot growth coach to automate and improve sales processes for its clients and prospects by leveraging HubSpot CRM and HubSpot Sales.
Since 2006, HubSpot ($HUBS) has been on a mission to make the world more inbound. Today, over 23,000 customers in more than 90 countries use HubSpot’s award-winning software, services, and support to transform the way they attract, engage, and delight customers.
HubSpot Sales enables sales and service teams to have more effective conversations with leads, prospects, and customers. HubSpot CRM helps sales teams organize, track, and grow their pipeline. All platforms integrate right out of the box and are available for free to start.
March 1, 2017
TRUSTe offers a broad range of solutions to help businesses manage all aspects of data privacy management. From consulting to help define a company’s privacy strategy, to privacy assessments and certifications, to their SaaS platform with modules to address a range of compliance needs.
Selling TRUSTe solutions to these companies—ranging from fast-growth start-ups to worldwide brands like Apple, eBay, GAP and Oracle—requires a deep knowledge of how to sell SaaS solutions cost effectively. And that is why they hired SFE.
The TRUSTe DPM Platform was purpose built to address complex privacy compliance and risk management challenges. The award winning SaaS solution was initially launched in 2011 and continuously expanded to address compliance reviews, cookie consent management, website tracker scanning, advertising compliance, data mapping, and much more. The SaaS technology solution is available via both self-service and managed service delivery options.
TRUSTe powers privacy compliance and risk management with comprehensive technology, consulting and certification solutions.
Based in San Francisco, we have two decades experience across all industries and a team of more than 150 professionals developing innovative solutions to address global regulatory and data protection requirements that govern the use of customer and employee information.
Our award winning Data Privacy Management Platform addresses all phases of privacy management including program development, data inventory, risk assessments, monitoring, and compliance reporting.