Jacco van der Kooij: The SaaS Sales Method for Account Executives; How to Win Customers

Winning the Relationship

B2B sales is governed by the following methodologies.

• DIY self-service
• Transactional selling
• Solution selling
• Consultative selling
• Provocative selling

The transactional sales process is a reactionary one. Transactional selling is best used in high-volume, high-velocity, inbound, low-cost models.

The solution sales process is also a reactionary process. Solution selling is best used in medium-volume, high-velocity-based inbound models.

In consultative selling, you are investing early-on in the customer to educate them on what is important based on what you have seen in the market. Consultative selling is best used when you are selling platform-like solutions involving a number of decision makers.

Provocative selling is best used when selling innovative solutions that address a CEO’s top issue.

All of these sales approaches use the same activities, differentiated in four key processes:

• Educating: Helping the market understand the problem, the impact and potential solutions.
• Prospecting: Reach out to customers who have pain and are a fit, and setting up a discovery call.
• Winning: Diagnose whether a customer can be helped and assist them through a buying experience.
• Growing: Help the customer to onboard and use the service to realize the impact.

Identify

There are four processes in identifying a prospective customer; customers who have experienced a pain and approach us via an inbound request, a group of customers we outbound to because they are a fit and are likely to experience pain we can solve, targeting several people at a small group of customers, and educating the market through content. From an Account Executive’s perspective, we now are adding a 5th prospecting process; Identify.

Identify is the process that is performed by an AE and starts following a COMMIT. We use this process to immediately identify any other sizable potential customer that has the same circumstances.

Diagnose

When you are talking to a customer, you must not communicate that you are “selling” before you understand their diagnosis. Many sales professionals feel that they have to show the customer their product, pitch some insights, and hope the customer will see how it can solve their problem.

Great sales professionals start by asking questions to diagnose the situation, without emphasizing the company they work for or service they sell. They engage not with the intent to sell, but with the intent to understand the customer’s situation.

There are three different kinds of questions. Sequencing these questions allows you to properly diagnose a customer’s problems. Establishing their situation, the pain they encounter, and the impact of solving those pains all lead to the value proposition of their needed solution.

How to Diagnose Your Customer:

• STEP 1 – Prepare for the meeting.
• STEP 2 – Open the conversation.
• STEP 3 – ACE the start of the meeting Goal: Structure the meeting, establish “why we are speaking and what we will accomplish.”
• STEP 4 – Set the agenda of the call. Confirm the agenda by asking each person on the call what they are looking to get out of today’s meeting.
• STEP 5 – Diagnose their situation and desired outcome
• STEP 6 – Summarize the conversation
• STEP 7 – Provide a 3rd – party reference
• STEP 8 – Identify value by presenting the Impact of how your solution could help
• STEP 9 – Next Steps. The key to the Recap is to link it to the ACE at the beginning of the call. SUMMARIZE what you went over today. ASK if their questions were addressed. RECAP the agreed action. ASK if they are ready to move forward. Agree to the NEXT STE.P Agree to a DATE. Discuss WHO should be present.

This impact determines the difference between nice-to-have vs. must-have, and understanding this concept is what separates a good AE from a great AE.

Today there are three kinds of software value propositions that impact a business.

• Increase Revenue.
• Reduce Cost.
• Customer Experience.

These value propositions are one step removed from revenue increases or cost reductions. Collaboration products, productivity tools, business intelligence software, human resources information systems, and security products all fit into this category.

The research shows that people tend to make an emotional decision, then validate with facts and figures. Thus emotional impact supersedes the rational impact.

A critical event is an event that is so important that it drives the decision. We must distinguish between a compelling event and a critical event: A critical event is an event that carries consequences if the deadline is not met. A compelling event is something that is more of a nice-to-have that indicates interest, but not explicit action to solve within a specific timeframe.

There is a direct relationship between Impact and Critical Event. They go together like pepper and salt.

Historically, most B2B deals used a hierarchy model, in which getting to the most senior decision maker resulted in the best results. Today we find that more and more decisions are made by committee, or consensus, and that senior involvement, although still important, no longer yields the best results.

This comes from the radical change in pricing models. Conventional B2B deals were often measured in hundreds of thousands of dollars, and the only ones with such an approval authority were the VP/CxO’s of the company. However, today we see most B2B sales using a subscription driven model (Software as a Service, or SaaS) resulting in fraction of the original spend. This lower spend gives a low-level manager the purchasing power on something that can impact the entire organization for years to come.

The hierarchy of the decision tree has collapsed into that of a committee where everyone has become “the decision maker.”

The user will be guided in the decision process by the UI/UX criteria, the manager may favor dashboards and reporting, whereas the executive’s primary concerns is to achieve the impact and to make sure a proper decision process was followed. The committee must reach a consensus to act.

As an AE, you need to achieve coverage to at least the Director level, and if possible at a VP level.

In hierarchical selling, navigating to a senior level is the single most important skill an AE can have.

Eventually the last voice on the committee is that of the economic buyer who is held accountable for achieving the “impact” against the investment in both money and time. Note that in a committee model, the most valuable role is NOT the most senior decision maker, nor the economic buyer. Literally anyone in the committee can derail the decision at any time. In committee models and in provocative sales, it is key to “orchestrate” the communication.

Both for Consensus and Hierarchy decisions, it is important to understand the sentiment of the buyer.

DO bring people together when they are ready for a decision. DO NOT bring people together to discuss problems (beyond those that are directly involved).

Prescribe

Following the diagnosis, it is time for you to demonstrate how you can help your customer. There are three very different scenarios:

• SHARE a customer story. Often used in first engagement with a customer when they ask “what do you do?”
• SHOW an example Often used in follow-up engagements when a customer asks “I want to see how it works?”
• PROVOKE an action. Used to stop conventional thinking.

When you use a 3rd-party reference, you talk through: Who experienced the problem (person), what was the problem they experienced (in context), what action did they take, what was the result they got from it, what did they learned from it, and how they applied it.

How to use storytelling using the “PARL ” (Problem, Action, Result, Learnings, Applied) approach.

How to engage a customer? Always try to phrase it in their words and context. Pick up on how they speak about their customers and products.

The top-performing sales organizations only show their solution after discovery, then customize what they show to only the customer’s top challenges.

Throughout the demo, make sure you continue to refine your understanding of the customer’s situation, problem and desired outcomes.

Before even getting on the call, you have set up the meeting as a professional: Executive briefing, reminders, technology check, and a clear understanding of your desired outcome of the call.

When to use provocative selling. Only to a handful of identified accounts, which are handpicked because:

• There is a high (> 50 %) chance of impacting their business.
• We understand the problem the customer faces.
• We have identified a critical event.
• We can access to customers senior executives.

How to provoke:

• Phase 1: Identify
  • STEP 1 Identify 3 accounts based on ICE use an existing relationship of a recent win.
  • STEP 2 Research. What data, information, or insight can you put in front of your customer that reframes the way they think about their business — how they operate.
  • STEP 3 Orchestrate.
• Phase 2: Diagnose
  • STEP 4 Outreach to start a conversation.
  • STEP 5 Have the conversation.
  • STEP 6 Diagnose – Find value! Identify critical event and impact.
• Phase 3: Select
  • STEP 7 Vision Pitch. What sets us apart is not the quality of our products, but the value of our insights.
  • STEP 8 Workshop. Goal is to reframe the challenges to a bigger problem or opportunity they hadn’t previously considered AND that you have prepared your company for to solve.
• Phase 4: Provoke
  • STEP 9 Provoke your customer with new perspectives, specifically tailored to their most-pressing business needs, in a compelling and assertive enough manner to ensure that the message not only resonates, but actually drives action.
  • STEP 10 Business Case: A good ROI calculator calculates the ROI on solving the challenge you’ve just taught your customer they have, not the ROI on buying your solution. Shift the discussion from price to value.
  • STEP 11 Showcase why your way of thinking about the solution is the right way, and how it fits with the new way your customers should be thinking about their business.
  • Phase 5: Proof
  • STEP 12 Proof: Present Emotional Impact.
  • STEP 13 Verify: They have discovered a new way make sure you keep the speed up.
• Phase 6: Trade
  • STEP 14 Negotiate. Stop negotiating and start trading with.
  • STEP 15 Attain commitment.

Not every objection is the same – here are the most common categories, based on three categories – Type of Objection, What They Say, What It Tells:

• You Lack of understanding the value. “We don’t need that.” Establish value by asking questions on the impact on their business. Keep asking.
• Raising a concern. “Your product is too complicated.” Show that this is not the case. Literally SHOW them, and let them DO IT. You can’t write/talk your way out of this.
• Wrong perception. “That does not pass our security profile”. Need to provide proof of how others overcame that issue.
• Lack of priority. “That feature you offer is not a priority”. Establish impact of that feature, and present it back to them … e.g., this feature means less training.
• Unclear about the decision process. “That costs as much as our entire marketing budget” You need to sell at a higher level. Use organizational selling to get execs involved.
• Secret agenda. The VP worked with your competitor at a previous company and appears to want to use them again. Research beforehand. Need to flush this out in the disco call and ask “what did you not like working with …”. You need to learn if this is a (+) or (-) impact. If (-) you need to apply organizational selling.

Select

The decision criteria are like the four center squares of a chess board. Control them, and your chances of winning the game radically increase.

During the first call/engagement, it is key for you to inquire about the customer’s decision criteria, and inform your AE during the transfer.

• STEP 1 – Determine decision criteria.
• STEP 2 – Prioritize decision criteria.
• STEP 3 – Determine ranking as best as you can today.

Now you need to increase the priority of what is important to the customer (impact on their business) and what you are good at.

Obviously, we do not have to stay within the box that was drawn for us. We can add criteria important to the customer.

For each account, the AE must identify and establish the following key elements to achieve success:

• Understand if there is (or else create) a critical event timeline.
• Understand in detail the impact of each criteria.
• Understand in detail the decision criteria.
• Identify the decision makers – per the decision criteria.
• Determine the decision process.

AE responsibilities:

• AE RESPONSIBILITY # 1. Knowledge. You must have an intimate understanding of your customer’s needs/decision criteria. You must understand how your product can meet that demand, today and in the future. You must learn and understand your competitors strengths and their approach.
• AE RESPONSIBILITY # 2. Assist the selection process. Establish the customer needs/decision criteria from the first interaction with a customer, and along the entire journey. Write these decision criteria down, repeat them to the customer, and make sure you capture the exact words they use. Ask the customer to prioritize these criteria (it’s effective to do this visually on a screen share), and capture the implied need of each of the criteria. Change the decision criteria, based on what the customer’s needs are, but in favor or our service, by: Moving the decision criteria that favor you up in priority. Moving the decision criteria that favor your competitor down in priority. Add decision criteria that favor you, by: Changing the decision process. Changing the decision makers. Changing the sense of urgency. Improve your rank (such as creating a 3-year ROI vs. 1-year pricing).
• AE RESPONSIBILITY # 3. Trade-off. Create a trade-off matrix.

Propose a Solution

Every quote should be standardized. You cannot make your own quote.

• Every quote must have an expiration date.
• Reference is needed for invoices later on.
• Note “price adjustment” NOT discount Don’t zero out products that are discounted, as these discounts may not apply to subsequent years.
• Mention specifically what you negotiated to have in return for the price adjustment.
• Start at a minimum the renewal for next year. This is needed to make sure that you do not have to extend year 1 discount into future years.
• Include terms. At a minimum, payment terms and the conditions of sale (ownership).

What is the difference between a value proposal and an impact proposal? An impact proposal also looks at usage to create the impact desired.

EXAMPLE of an impact proposal:

• PART 1 – Executive briefing.
• PART 2 – Value proposition. The problem your company was approached with. The key value points discussed. The goals you are looking to accomplish with the service.
• PART 3 – Customer pain points.
• PART 4 – Impact on the business.
• PART 5 – Examples.
• PART 6 – Plan.
• PART 7 – Deliverables.
• PART 8 – Who is involved.
• PART 9 – Timeline.
• PART 10 – Price.
• PART 11 – Terms.
• PART 12 – Trade-off. Educate your customer on the Pros and Cons of your service.
• PART 13 – Next steps.
• PART 14 – Signature page.

DO NOT mention the word “Discount” or “Free” anywhere in your proposal. Instead refer to “price adjustment” and clearly state what you received in return for the price adjustment.

Trade

Four major questions when confronted with “Your price is too high”.

• QUESTION 1 – Ask, “Compared with what?” or “Can you explain that?”
• QUESTION 2 – “Are you ready to commit now?”
• QUESTION 3 – “Is pricing the only remaining issue?”
• QUESTION 4 – “Please share with me what the price difference is, and I’ll do my very best to narrow the gap.”