Sales Models, Metrics, and Motions Blog

SaaS and the Evolution of Inside Sales

by Trish Bertuzzi on Wed, Sep 23, 2009

In the olden days

It used to be that selling software was always an Enterprise deal that required Enterprise activities. You needed to develop relationships with multiple buyers, educate them on your value proposition, demonstrate technical expertise and show them that changing the way they did business was a good thing. A lot of those activities required face time so you had to be onsite with the prospect developing that relationship of trust.

Along came SaaS

It is not so much that software-as-a-service (SaaS) has changed how we sell - as how it has dramatically lowered the barrier to buy. Enterprise and on-premise deals that require a more traditional sales model are not going anywhere - no matter how much hype you hear to the contrary. But, the movement towards SaaS does dictate an evolved selling model.

What are some of the factors impacting the evolution?

The New Buyer Role
According to SiriusDecisions, buyers are more informed and seek information independent of sales. The amount of information (product, competitor, user, etc.) now available allows Buyers to self-educate like never before. Just like in our personal lives, people are more comfortable using the phone and web to gather the information that allows them to make decisions and engage with sellers much more freely.

Fewer Barriers to Entry
Price points have fallen and the month-to-month mentality in much of SaaS makes Buyers much more comfortable with making a purchasing decision. Additionally, many companies now allow Buyers to trial their solutions. As a matter of fact, some have built their entire Sales & Marketing strategy around pushing demos and trials into the market.

Their sales model is formulaic: x number of trials will convert at y% with a z price point - resulting in a revenue stream of xyz. They have figured out their "formula" and now their key to success lies in executing flawlessly.

Inside Sales is now a "career"

Sirius Decisions just released a note on the topic of Inside Sales and growth strategies for 2010. They argue:

As sales leaders look beyond the missed revenue targets, headcount reductions and budget cuts that typified the sub-prime recession of 2008-9, they need to consider further expanding the role of inside sales as they adapt their organization to capitalize on the next growth cycle."

Sales leaders evaluating their coverage model need to consider three inside sales realities:

  • Inside sales will grow as a percent of total revenue
  • Inside sales can handle larger/ more complex accounts
  • Inside sales can sell more complex products/solution with higher ASPs

The reality is that although Field Sales is never going to go away, our Buyers no longer need as much face time with us. They do much of their own research, communicate with us via a non-traditional methods (blogs, LinkedIn, webinars, etc.) and are as time and resource constrained as we are.

Inside Sales is a viable strategy (whether or not your company offers SaaS) you just have to figure out your "formula".

I plan to share some additional thoughts about SaaS companies implementing Inside Sales in the future. Stay tuned and share your thoughts please!

(Photo credit: ionushi & TW Collins)


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