In 1901, the Encyclopedia Britannica was printed in the United States and was infamously sold door-to-door. These hard working salespeople were often the butt of Hollywood jokes - including a famous 1969 Monty Python sketch.
In 2012, the company finally halted their hard copy version, in favor of a digital version. This was a historically symbolic moment that took 111 years to happen. What is even more remarkable is that the sales industry has arguably evolved just as much in the last five years as it did in the previous 111.
While sales managers in the encyclopedia era certainly had their challenges, the job of a sales leader today is more complex than ever, and moving at a speed that many are struggling to cope with.
This is particularly true in the software-as-a-service (SaaS (News - Alert)) industry which has exploded. A new study from the Bain & Company research brief The Changing Faces of the Cloud predicts global cloud IT market revenue will increase from $180B in 2015 to $390B in 2020.
The SaaS model – led by companies such as Microsoft (News - Alert) and SalesForce – is attracting more disruptors than ever before. As new companies threaten marketplaces and margins, sales leaders in the SaaS space that do not ‘track and react’ to the industry’s latest trends could face extinction.
As the leader of a B2B sales recruiting company that works with world-class SaaS brands to build their sales force, here are the top 5 trends that every SaaS sales leaders needs to know, based on third-party data and first-person experience.
BEING CUSTOMER CENTRIC IS KING: As the buyer seller relationship evolves in response to a more educated consumer base, sales leaders are transforming the way sales success is being measured. Per the SalesForce State of Sales report, companies now rank customer experience as the number one KPI used to measure sales success. This means business development leaders must transform their teams to ensure time is made for reps to deepen customer relationships and establish themselves as trusted advisors. In fact, many organizations are including reps in the customer onboarding process to ensure purchasing expectations are being met and business value is being delivered from the start. This tactic is being tested to reduce churn and maximize revenue new account revenue.
SALES FORCE STRUCTURE IS NOW EXTERNALLY DRIVEN: The “Hunter” vs. the “Farmer” question has been going on longer than the debate over who would win a boxing match between Muhammad Ali vs. and Mike Tyson - when he was in his prime. But in 2017, the question is no longer who does the firm need. Instead, it’s what competency profile is required to meet the customer’s needs and buying behaviors. This decision to pivot hiring requirements, and by extension, the structure of the sales force to effectively find, close, and ultimately add value to its customers is what’s setting apart today’s most successful SaaS sales teams.
IT’S NOT ALL ABOUT INSIDE SALES: Due to reduced up-front financial commitment, many SaaS deals are being cultivated using an inside sales model. HubSpot (News - Alert), a shining example, grew revenue 6,000% in the last four years using a team of 110 inside sales reps. While inside sales are great, the majority of buyers, as SaaStr VC founder Jason Lemkin correctly states, gets exposed to a vendor versus searching for one. And for SaaS firms targeting enterprise accounts, the need to gain senior executives attention and close high dollar deals has forced sales executives to shift from a pure inbound to outbound model. In fact, according to LinkedIn’s 2017 Recruiting Trends Report, the top role companies are hiring for is sales.
BUYERS ARE MORE CONCERNED WITH DATA SECURITY THAN EVER BEFORE: In recent years, there have been many high-profile data breaches in the U.S. such as Yahoo!, Ashley Madison, the Democratic National Committee and Target (News - Alert) to name a few. Consumers and B2B buyers alike are more concerned with data security than ever before. This is especially true in the SaaS industry. A Tech Pro Research survey found nearly three-quarters of respondents said they chose an industry cloud service provider based on who could protect their company's data. This is forcing sales and marketing leaders to introduce new collateral and selling propositions that focus proactively address buyer’s cyber security concerns.
SMBs ARE HUNGRY FOR SaaS: It is not only major corporations investing in cloud-based software. The 2016 Report on the State of SaaS by Better Buys showed that 64% of small and medium companies use cloud technology to drive sales and boost efficiency. Nearly 80% of the small and medium sized business surveyed said they plan to use more SaaS software across business processes in the next three years.
The B2B sales industry is in a period of unprecedented transformation. The SaaS sales industry is a huge growth opportunity and the sales leaders that understand the trends will have an even greater chance at succeeding.
About the Author: Eliot Burdett is an author, sales recruiting expert and the Co-Founder and CEO of Peak Sales Recruiting, a leading B2B sales recruiting company launched in 2006.
Edited by Maurice Nagle