p class="Box-sc-9env3-0 Text-jjrgda-0 QTextPara___StyledText-anoo6m-0 fSlQBa qtext_para">They work — if done right. And they are incredibly important.
We spend so much time marketing and selling to customers. And building stuff for them.
But almost no one thinks enough about what a buyer reallygoes through.
Especially, sales and marketing teams often don’t think enough about the risks in buying a new piece of software. It’s not just the $$$ in the contract:
The soft costs to deploy a piece of software are often 3x+ higher than the direct costs. The training. The business process change. The work to pilot something inside of an already dialed-in business process. Etc. etc.
The time investment cost is high. If the app fails to work as expected, the vendor loses a renewal. But the customer loses all that time invested in qualifying, testing and deploying a vendor. I’ve never seen a sales team really
Q: When should I pay the commission for SaaS sales? All of our trial signups will get an automatic email from an account executive. How do we decide if the AE was responsible for the sale versus the sale just happened organically?
p class="Box-sc-9env3-0 Text-jjrgda-0 QTextPara___StyledText-anoo6m-0 fSlQBa qtext_para">Every company with a self-serve component and a sales-driven component frets a bit about paying sales reps on deals that close “automatically”, or close to it.
And yes, in a sense, in some days the sales rep gets a freebie there.
But later you learn this is always true in sales. In any type of sales, some deals are easier to close than others. Some close fast. Some close in 1 call. Some take years.
And in the end, you generally have to pay sales reps out on all the leads they cover. Even the ones that barely needed a touch from sales at all.
Q: What’s it like building a company and seeing the first big sum of money come in?
p class="Box-sc-9env3-0 Text-jjrgda-0 QTextPara___StyledText-anoo6m-0 fSlQBa qtext_para">A few key milestones to me in SaaS really stood out:
The first $50k deal. This might sound small today, but closing our first customer at $50,000 a year proven we had a viable business. Most of our other customers at the time were tiny ($12-$99 a month). One $50k customer isn’t enough. But most folks get that once you close 1, you can close 2, and then 5, and then 10 …
The first $250k+ customer check. Actually, it was a multi-year deal so it was $600k+. I blew it up to something like 5′ x 3′ and pasted it behind the sales rep’s desk. So everyone knew. Then, everyone believed.
With the complexity of multiple stakeholders and the increasing purchasing influence of end users, the bar is higher than ever for enterprise UX as companies pioneer business models beyond traditional SaaS. Learn how to apply consumer grade growth, engagement, design, and prioritization strategies to increase adoption within your products.
Want to see more content like this? Join us at SaaStr Annual 2020.Ciara Peter | VP of Product @ Invision StudioBela Stephanova | Senior Director @ Box Product ManagementCraig Villamor | Design Director @ Google MapsShanee Ben-Zur | Head of Marketing & Growth @ CrunchbaseFULL TRANSCRIPT BELOW
Please welcome Invision Studio VP of Product, Ciara Peter, Box Product Management, Senior Director Bela Stepanova, Google Maps Design Director Craig Villamor, and Crunchbase Head of Marketing and Growth. Shanee Ben-Zur.
Why folks wait for the last minute I have no idea. We’ll have 15,000+ at the 6th SaaStrAnnual.com on March 10-11-12 in SF Bay Area.
And yet, only 36% of CEOs that will come have bought their tickets. VCs are worse. Only 11% have bought their pass!
That’s OK if you want to pay more. But why?
Tickets go Late Bird on Jan 1 and go up $400!!
You can come now for 40% less. Grab the final 2019 priced tickets here.
So who’s coming and speaking?
Salesforce likes to talk about “Customers for Life”, and while that’s sort of catchy, it’s a little hard to grok what it really means.
It finally sunk in for me a bit the other day. At EchoSign, now Adobe Sign, there’s a large group of well-known customers that I closed, Back in The Day … that now have been customers for 10 years.
We launched on January 1, 2006 on TechCrunch, and while we closed some good names that first year (Dell, BT, Qualcomm, GE, Comcast, etc.), it wasn’t until later on in 2007 that we had enough revenue to create a large enough group of customers to go on a 10 Year Journey with. And the law of Power Laws and Large Numbers means that, obviously, Adobe has closed far more customers under its watch than I ever did. The business has grown 15x since then.
Continue reading "How To Keep Your Customers For a Decade. Or Longer."
Q: What were the effects on Adobe’s finances when they switched from a licence purchase to a subscription model?
p class="Box-sc-9env3-0 Text-jjrgda-0 QTextPara___StyledText-anoo6m-0 fSlQBa qtext_para">Switching to a SaaS model, and going deeper into SaaS, was a generational accelerant for Adobe:
Stock price up 1300%
Revenue run rate grew from $4 billion in 2012 to an estimated $14 billion in 2020 (!)
We all underestimated the force the Cloud would become.
Adobe was essentially stagnant for the better part of the Decade before going all-in on Cloud around 2012. And it took a few years for the benefits to really kick in, as recurring revenue initially led to a lot of deferred revenue (as revenue had to be recognized over a longer period of time).
So you had a great December, added a great VP or two last year, won some bigger deals, and in general — you’re feeling good.
You’ve even got a decent financial plan for this year in place. Even better.
With all that behind you … let me challenge you to 10 SaaS New Year’s Resolutions. Pick a few that work for you:
Get That Key VP Hire Done in Q1. Period. Not in April. Not by June. Enough with the excuses for not having hired your real VP of Sales, or that VP of Engineering, or whatever. Get it Done. From now until Mar 31, make this your #1 priority. Hire a real recruiter. Force yourself to meet 30 additional candidates. Meet at least one new candidate every single day. Once you hit Initial Traction, nothing really matters but the team. Drop other stuff to get this hire done. Continue reading "10 SaaS New Year Resolutions For You. Pick a Few."
You could spend days reading about pricing and pricing strategies in software on the web, but a lot of this content doesn’t really hit one, basic fundamental point — there is no real reason any particular piece of software should cost anything in particular. Or something. Or a lot. Or anywhere in between. Because it costs next to nothing to deliver.
Facebook and Google are free — and both are better software than anything you’ll ever ship, my friends. Slack and Zoom are close to free — you can use the free editions almost forever. Dropbox is cheap — but Box Enterprise isn’t. Salesforce is fairly expensive. Workday is really expensive. And ServiceNow closed 678 million dollar deals this year!! All these 10 apps basically cost the same amount to build, host, serve, and ship. Yes, enterprise software costs more to sell and support and, sometimes, to market than consumer software. But
Ep. 294: The SaaS business model has risen to popularity for many reasons – it’s fast-paced, creates residual revenue streams, and well, the multiples are strong. However, while many are flocking to reap the benefits of the SaaS model, truly understanding how it works sustaining success over time is not as easy as some make it look. Rajesh is going to walk you through the key elements of winning the long game in SaaS – how to win customers, how to create long-term relationships, and how to avoid churn. He will also provide insights on the differences between commercial and enterprise customers and the key metrics to keep an eye on as you grow your business.