In the last few months, I have met enough startups who have not been so successful in selling their product/service to enterprise companies.
Not that their product was bad, but because the sale just didn’t happen. Just didn’t happen.
While the real reasons could vary for each case, here are a few possible things that one should know before making the enterprise sale
Decision Maker
Who is the decision maker? Is it really the CIO/CTO? Actually not.
In most of the cases, it’s actually some other guy who is going to ‘recommend’ the service. [Read the next point now]
Second Meeting
By your second meeting, you should be able to figure out who this guy is? Marketing manager? Sales head? VP Engineering? Identify that guy,by the second meeting. Typically this will be the guy who will be asking you lots of questions, during the meeting. Focus on that guy – try to spend some time with him/her, do a linkedin profile search to get some common connection to strike some informal conversation in the next meeting.
If you are meeting the same folks again and again, you are simply wasting time. Move on.
Sales Strategy for small businesses - Help thy Decision Maker
Appraisal Cycle
Some of the best sales guys I have interacted with tend to figure out the decision maker’s KRA, i.e. KRA = Key Results Area.
Is ‘X’ really his KRA? If yes, then how shall I position my product so that his X becomes 2X (show him that vision!).
Essentially the idea is to figure out the ‘pain’ and ‘joy’ of the decision maker and see how you can use that to your benefit?
Are you Adding to Pain?
In big companies, software infrastructure gets screwed up over the time. Companies tend to buy each and every piece of software and if you are the one who is making an enterprise sale, do find out the last mile solution. Does your solution need extra manpower? [Read: Are you selling Product or Solution? The Last Mile Challenge with Product Selling]
I recently met a startup who wanted big companies to give their content feed to him, so that he can market that and do a rev share with big companies (his product does lot more, but this is the crux of it). Imagine this – the sales/marketing guy in this big company will have to track another channel for revenue/branding! Is it really worth it (given that startup was too small and was projecting smaller revenue numbers in the near future).
Why take so much of pain? The result is that every big company looks into the product demo and says ‘we will get back to you’.
Your Small Size
Answer this – if you have to buy a house, will you buy from a branded developer or somebody who is just starting up?
Your answer will tell you why many startup/enterprise deal fail – enterprise companies are just not comfortable doing business with ‘unknown’ guys who have no backing.
How does one tackle this? Well, no right/wrong answer here, but doing your homework will help [for instance, do you really need this big customer or do you need 4 small customers to get across this one?]
What’s your opinion?
[More on Enterprise sale in the next post. Meanwhile, if you have interesting insights/experience closing enterprise sales deals, please share.]
[The article is sponsored by Sun Startups Essentials.] ![sse[1]](http://www.pluggd.in/wp-content/uploads/2009/12/sse1.jpg "sse[1]")
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Good article…Finding out the KRA is actually a key thing…you can win only if you help others win
Nice point you have made about identifying the decision maker as the guy who asks the most questions.
I think large enterprises need that trust factor when they are buying from a particular vendor. This can be done by having strong extensive product literature, a good-looking & usable website, case studies of other companies successfully using a particular product (if it from the same domain, even better), white papers etc.
If you come to think of it, getting all the product literature is not that difficult a process – it is just that you will have to apply yourself really well and be patient since it might seem like an exercise in futility at times, as it does not bring about immediate returns. But the entire point is it does a long way in getting the feel about the brand, the entire trust factor about the brand to a much higher level.
Also beneficial could be showing a lot of examples, a lot of demos on the websites so that the large enterprises can look at the demo and say – this is exactly what I am looking for.
And yeah before I forget – GOOD SUPPORT. The enterprises need to know that when they are stuck with some technical problem, what kind of support will be made available to them? Will the vendor even be there to support them? Again over here, a good buzz around the brand (which can come through recommendations and testimonials) goes a long way.
Another thing startups should take care of is correctly estimating the duration of entire sales cycle. Some things take several months – important to have resources, energy and enthusiasm to last the whole period…
Good Post Ashish – And like your point on finding KRAs – just dont think its that easy. If the software or product you are selling isnt hitting the sweet spot then you have to come up with different ways in which to “satisfy” the user. I think teh bigger problem is the positioning and Target Market – if they are defined then the next steps of talking to the sales person / knowing their background etc is useful. If you are aiming for “anybody” then you end up spending a lot of time “convincing” them to your way. I have seen too many startups which try to make money instead of trying to solve the problem initially.
PS: My comments were generic and not to insinuate that the startups you mentioned had done these things.
Oh yeah! Finding kRA ain’t easy – had it been so damn easy, everybody would be selling to IBM/Wipros of the world. My pt is to keep that perspective while talking to that decision maker
Good article – Ashish, startup has biggest challenge having them consider for projects when they are small in size.