What every sales professional selling SaaS needs to know
With the number of salespeople selling SaaS products at an all-time high, competing with heavy-hitting sales teams and cutting through the noise seems impossible. The inboxes of key prospects are filled with pitches, industry conferences are packed with big-league brands, and the rest of us are left looking for scraps and trying to get a single phone call.
Over the last few months alone, we’ve seen and spoken with countless sales professionals using Close to sell software to brands and break through the noise. We’ve heard plenty of sales professionals talk about their success, but we’ve also heard from those who have struggled to get any traction selling SaaS.
The question is: Why?
Why do some sales professionals selling SaaS make it look easy while others struggle?
In today’s blog post, we’ll share what we know about finding success selling SaaS, plus advice from a handful of the best talents in sales. If you’re a sales professional selling a SaaS product, this is one you might want to bookmark and come back to. (And if you haven’t yet signed up for our free startup sales course, do it now!)
Here are five things that every SaaS salesperson needs to know.
The average sales cycle will depend on the price
For most SaaS products, the sales cycle will depend on the type of product you’re selling, the reputation of the product and the price tag. Many SaaS salespeople make the mistake of underestimating their sales cycles in order to look good, but it’s better for you to be upfront with your manager or boss about industry expectations.
When Jason Lemkin, founder of SaaStr, was asked for a good benchmark for B2B SaaS sales cycles, he wrote:
- Deals < $2,000 in ACV should close on average within 14 days.
- Deals < $5,000 in ACV should close on average within 30 days.
- Deals < $25,000 in ACV should close on average within 90 days.
- Deals < $100,000 in ACV should close on average within 90–180 days depending on the number of stakeholders and gates.
- Deals > $100,000 in ACV will take on average 3–6 months to close.
A game-changing deal isn’t going to close overnight. It takes time.
That means you’re going to need some patience if you want to sell SaaS to enterprise customers. Enterprise sales is a completely different beast than selling a $5,000 or even $25,000 service. When you start dealing with projects that cost six figures a year, the sales process becomes increasingly complicated. That’s why our own Steli Efti points to expecting a long sales cycle as the first rule for startups selling to enterprise clients.
If you do want to try and speed up the sales cycle, here are a few good tips:
Marketing is your friend, not your enemy, when selling to SMBs
Selling SaaS products to small and medium-size businesses (SMBs) requires a bit of kumbaya between sales and marketing. It's not realistic to have a huge sales team calling SMBs in hopes of closing a $500- or even $5,000-a-year contract. You need to have a marketing funnel in place that keeps leads rolling in because people are excited about your brand, your value proposition and the buzz you’re generating in the press.
The best sales professionals selling SaaS products with a ticket price of less than $10,000 a year recognize the role that marketing plays in their success. Instead of telling marketing they need more leads every week, they sit down and work with marketing to ensure that the message they’re sharing lines up with the leads they want to see and the problems that prospects reveal during their calls.
Telesales & inside sales are not the same thing
Don’t mix up the two.
Inside sales is the act of identifying, nurturing and turning leads into customers remotely. It’s an approach to selling that in recent years has become one of the most popular sales models. Inside sales has more built-in growth potential than traditional sales and is becoming more popular as organizations and sales professionals continue to embrace technology.
Telesales, on the other hand, is a completely different ball game. Telesales is essentially the act of calling people (sometimes at random) over the telephone and selling them something they may or may not have ever shown interest in.
Scott Sambucci of SalesQualia once described the difference between telesales and inside sales like this:
Telesales are useful for the $100/month product or timeshares in Vegas. A true inside sales professional is a highly skilled individual that is able to develop relationships, read customer psychology, generate interaction effectively on a product demonstration, and motivate your the prospect to take action—all over the phone.
At Close, our focus is on arming sales professionals with great inside sales CRM software and tools that will help them do their job well. While built-in calling is a feature we offer in our CRM software, we also offer email tracking, SMS communication and much more. We recognize that inside sales professionals need a robust toolkit to do their job—not just a phone.
Big deals might require a bit of face-to-face
Not all deals are going to require face-to-face but some prospects will need it.
You obviously want to limit the number of face-to-face meetings you have to take, but when you’re selling a six-figure price tag, it’s likely that a meeting will be needed. In fact, it’s likely that many meetings will be needed—with your direct contact and with other stakeholders in the organization.
Stressing over a long sales cycle is pointless
Plenty of SaaS salespeople find themselves feeling overwhelmed and stressed. The most common stressor amongst salespeople is typically their ability to hit their quotas.
I get it: Your quota is your livelihood.
But when you’re new to selling SaaS, this stress is often misplaced as sales professionals are simply unaware of the typical sales cycle.
If you’ve just started selling a new SaaS product and your sales cycle feels long at first, don’t stress over it. Instead, focus on nurturing the leads in your funnel and establishing stronger relationships. As I mentioned earlier, plenty of products are going to have long sales cycles and if that’s your scenario, it’s just a reality.
What should you do next?
Now that you know a few key insights about SaaS sales, it’s time to put them into action. If you were stressing over a long sales cycle, rest easy and understand the difference between an enterprise sale and a sale to an SMB. If your team hasn’t embraced marketing yet, now might be a great time for you to make it a priority.
And if you already knew all these insights, you’re well on your way. In fact, I’d love to hear what you wish you knew before getting started in SaaS sales so we can share your insights with the entire community. Leave a comment below! I’d love to hear from you.
Want more insights on SaaS sales? Sign up for our free Startup Sales Success Course! It's filled with actionable advice that will teach you everything you need to know about selling SaaS.
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