In June, CNBC reported that recently listed cloud software companies were getting crushed for poor sales execution.
That’s not hard to believe. Enterprise sales is hard, which is why most businesses start as an SMB org and grow into an enterprise org.
Even starting small, though, most companies fail to make this transition. And those that do often struggle through the transition, leaving behind a churn of leadership and sales resources after every funding milestone.
So let’s look at how to drive sales in a high-growth situation, so the transition from SMB to enterprise is smoother (and faster). We’ll cover:
- The #1 hurdle to fast growth
- 2 rules for transitioning from SMB to enterprise
- A checklist for how to target early adopters
- 5 tips to successfully cross the chasm to mass adoption
The #1 Hurdle to Fast Growth
Today, enterprise sales is harder than ever. Sellers invest a lot of time in playbooks to fine-tune the script, yet attainment rates are dropping.
But the key to making sales “easier” isn’t necessarily a new playbook. It’s adoption.
You see, customers are more aware today than at any time in history. They’re more sophisticated in doing research on potential vendors. And one of the criteria they use to evaluate a product is social proof: How many of their peers are using the tool?
Which brings us to the Roger’s Innovation Adoption Curve.
This theory explains how, over time, an idea or product gains momentum and spreads. From our perspective, this bell curve describes adoption rates over a product’s lifetime. And the thing to understand is that the people who will buy a newly minted tool or resource are distinctly different from people who buy once the product is well-established.
So your strategy is to find the early adopters and figure out their unique characteristics, so you can easily target them. Then, leverage that success to sell to “early majority,” AKA pragmatists.
That’s it. A one-two punch that fast-tracks adoption and growth.
But it’s not as easy as it sounds. Notice the chasm that exists between “early adopters” and “early majority” in the graphic above.
The chasm exists because most people are risk-averse, and in the enterprise space even more so. Status quo is more acceptable than to try something new and break what’s working, albeit less than perfectly.
The majority of buyers are pragmatic. And because of that, they don’t like change.
To overcome this prejudice, it’s important to showcase your early adopters to the pragmatists — not as role models, but as peers just like them, who were pragmatists and became early adopters since you offered sure success.
The pragmatists know they need to change. They know they need to take action. What they want to know is if you will be there for them when things don’t go as planned.
We’ll talk more about this in a minute. For now, we need to move on to the 2 rules for boosting adoption and growth from day one, so you set a solid foundation for crossing the chasm.
2 Rules for Boosting Adoption & Growth
These two rules should be your guiding light when you’re getting into the enterprise space.
Rule 1: Always be nurturing.
You’ve heard the “always be closing” mantra, right? Well, those days are over.
Today, buyers are more aware. They recognize your marketing and lead-gen tactics a mile away, and they’re not going to comply with your linear sales process.
They want to buy the way they want to buy.
Instead of getting on a call and exposing themselves to an SDR’s discovery process, they want to understand your unique point of view, insights, and recommendations to problems. For that, they’ll check out your website and read your blog.
They want to know they can trust you before they share details about their situation. And the only way to build trust is by establishing yourself as a value-adding expert who knows your stuff.
What does that mean for your sales team?
They need to focus on nurturing by sharing insights rather than dialing discovery calls.
It doesn’t matter what stage of growth your company is in, you should always be nurturing. Your buyers need to see the return on investment of interaction with you and your team.
Rule 2: Run a filtering exercise.
As I mentioned above, in the initial days of breaking into enterprise, you are looking to find the innovators and the early adopters. They are only about 15–16% of the population, so you need to find them quickly.
It’s a needle in a haystack challenge. You find the needle by being a magnet that has a unique POV to attract like-minded companies.
How do you do that?
- Invest in a community
- Share your unique point of view on LinkedIn
- Speak at conferences
- Make your SDR outreach about education not prospecting
Remember, the traditional metrics of dials and conversions don’t apply at this stage.
Checklist: How to Target Early Adopters
Here’s what you need from your sales team to target early adopters and innovators.
Sales process: In the beginning you really have no process. It’s a journey of discovery for you to understand where the buyer finds value. You should focus your sales team’s efforts on finding the value or the “wow” moment.
Don’t let process get in the way. The process will get built. For now, focus on uncovering needs and stay focused on the goal through iterative conversations.
- Keep the sales team focused on the goal, not the process.
- Focus on iterative conversations with customers.
Competencies: Startups exist for one reason — you had a different point of view. You think differently and are challenging the status quo. As such, it’s important for your sales talent to lead with a point of view.
At this stage you are looking for early adopters and contrarian thinkers who align with your POV.
- Act as problem-finder and focus on teaching moments.
- Be provocative and do not be afraid of being a contrarian.
- Focus on being a “servant leader” for the customer/prospect.
Value proposition: Focus on adding value to the conversations you have with your prospects or audience group. Every interaction should be a value add.
Make sure your value proposition clearly states how you add value to your prospect’s life.
- Focus on sharing insights and best practices.
- Challenge assumptions.
Business objectives and compensation: When you started your company, you must have had a vision and mission.
Make sure you align your sales team’s incentives to deliver on that vision. Sales can easily get caught up in making transactions that can make the company lose sight of the big picture.
- Have long-term business objectives.
- Align compensation for long-term goals.
- Drop variable compensation.
- Focus on reference and renewal.
5 Tips for Crossing the Chasm
By now, you’ve won over the early adopters and innovators. Now comes the hard part — winning over the pragmatists and doubters. This is key to winning in enterprise sales.
Here are 5 tips for successfully winning their business.
1. Level up your prospecting and sales process.
Win rates may drop initially (and that’s okay). But do be prepared. Those drops mean it’s time to level up the sales process you used as a start-up.
Prospecting needs to be disciplined. Pipeline management must be agile.
TIP: Be ruthless about closing deals early in the sales cycle.
2. Change your SDR profile
Prospecting in high-growth situations means selling higher in the organization. Your SDRs need to be teachers. They’ll be calling industry veterans of 20+ years, and trust me, reading off a script won’t work.
Rapport building will be more nuanced, and that means the SDR/outbound team needs to be more mature and knowledgeable about industry trends.
TIP: Creating SDR teams in pods by vertical focus may work well for you if you are selling a horizontal product in many verticals.
3. Share industry insights
Communicate clearly that you know how to make your customers successful.
Most enterprise projects require change management. Your ability to understand and explain how your product fits into the enterprise stack and business process is key.
Enterprises will not change their business process to accommodate your tool. You will need to get over change resistance by being perceived as a thought leader sharing insight and prompting change.
TIP: Don’t sell. Educate.
4. Involve Customer Success early
Every enterprise deal has a pre-close meeting. Your customer success manager for the account needs to be in those meetings.
It’s important that Customer Success hears from the customer before the contract is signed. I have seen a lot of customers terminate contract soon after signing, saying the service experience was not as desired.
Customer Success needs to understand where the customer feels anxiety, and they need to see their part in the joint mutual action plan post-contract.
TIP: Focus on reducing the buyer’s anxiety by being a part of their team.
5. Be a thought leader
Invest in creating a customer advisory board to bring peer groups together.
You drive thought leadership if you can bring others from the industry together. By following the servant leader principle, you foster an environment for your customers to engage, share, and learn from peers.
TIP: Be more than just a vendor. By being a consultant, advocate, and industry leader, you’ll earn your customers’ loyalty — and a larger share of the market.
Pay attention to your growth spurts as an enterprise sales company and match your process to the audience you are engaging.
This is different from identifying the ideal customer profile (ICP). It’s about understanding the persona against the lens of Roger’s Innovation Adoption Curve.
Now with Millennials moving into the mid-manager ranks of your ICP, it’s even more urgent to align to this framework — this generation researches more on their own, are looking to make an impact and build a personal brand, and like to make decisions with consensus.
As such, just as we have moved from delivering products to delivering service, we have to move from selling to serving.