In SaaS / XaaS, the name of the game is to deliver customer results at the speed and scale that competition cannot match. Therefore, your sales motions are different from those of the traditional software/technology suppliers. Marketing, sales, services, customer success and other organizations or teams engage in unprecedented levels of collaboration with buyers at all stages of the cloud customer journey. The customer journey map provides a framework for the alignment of your activities along what matters most – value to customer (see Fig. 1).
Figure 1
The eight stages of the archetypal SaaS / XaaS customer journey are as follows.
1. Value discovery – Customers or buyers discover your company, your products and services. Nowadays, vendor and product information is ubiquitous and can be found in a variety of online sources. According to a study by CEB, 57 percent of a typical purchase decision is made before a customer even talks to your sales team. Therefore, the dialogues with customers in this initial stage should move beyond product-based messaging and focus, instead, on understanding their specific business problems and how your product can solve those problems, while differentiating against the competition and the status quo.
2. Value definition – Buyers evaluate your products and services. Ideally, with guidance and help from your sales team (which may include product demos, proofs-of-concept, value engineering, business case and ROI), they make the right purchase decision and become your customers.
3. Value delivery – Value delivery may actually begin even before closing a sale (as in freemium). It includes implementation of your product and onboarding of the users. Both successful implementation and smooth onboarding experiences enable customers to realize the benefits of your solution.
4. Value realization – Value realization occurs when customers experience payoffs from investing in your product. Time to value and size of the benefit are important and create the foundation for success. Traditional software/technology organizations and, surprisingly, many cloud vendors often overlook this stage.
5. Value growth (expansion) – When customers realize the business value and achieve results from their initial investment, they double down in your products and services, expand the relationship and allow you to upsell and cross-sell.
6. Value validation – At renewal, you prove the value (ROI) and prepare the customer for the decision to either renew or to leave.
7. Churn – The customer leave is called churn in the subscription business, and it can happen at any time. Therefore, it is important to monitor indicators of churn throughout the customer journey, track customer health and take timely actions to resolve their issues and concerns.
8. Value advocacy – You want to develop customer advocates and amplify their voices across social channels. Customer advocacy can occur at any stage of the customer journey, and it is different from customer reference programs.
Typically, marketing is responsible for value discovery, sales for value definition, and services and customer success for value delivery and value realization. Value growth, value validation, and value advocacy are shared by sales, customer success and marketing organizations.
Three sales motions
Sales motions in SaaS /XaaS are Land, Expand and Cultivate. Land is the initial sell, Expand is the account growth, and Cultivate is the advocacy growth. These three sales motions optimize the focus of the initial selling, the efficiency of expand selling, and the effect of the network (see Fig. 2).
Figure 2
Sales motion #1: Land more customers, faster!
In SaaS / XaaS, rapid customer acquisition is a crucial capability. Ensuring effective customer interaction across all touch points goes a long way toward increasing the speed of customer acquisition and building a sound foundation for customer relationship and loyalty. Land selling begins in marketing with campaigns designed to expand brand awareness and generate new leads and converts. Marketing at this stage creates the social environment for buyers to discover your product and understand its value by providing targeted and relevant information.
Ensuring smooth transition from product discovery to product evaluation, and then making the product evaluation experience effortless for customers, dramatically increases your odds of closing a sale.
After acquiring a customer, you streamline the purchasing process, enable exceptional customer onboarding, ensure rapid implementation, and so on.
At every stage of the journey you create motivation for customers to move to the next stage by addressing any structural, process, integration, change management and other barriers or gaps that stand in the way.
Sales motion #2: Expand use, value and footprint
As your company grows, renewals and upsells from the existing customer base will provide greater contributions to your revenues over time. To ensure that your customers realize the business results from your products, you need to engage with them, monitor interactions with them, collect usage data and metrics on success, and then provide your teams with the KPIs, reports and playbooks they need to do their jobs.
Customer success with your product leads to expansion by adding additional seats, new modules or complementary products and services. This translates into greater incremental revenue for your company.
If you focus on delivering ongoing customer value by facilitating outcomes that they want to achieve, you can actually expand and upsell and cross-sell with a fraction of time, effort and cost that it would take to acquire new customers.
Sales motion #3: Cultivate customer advocacy
The third sales motion is cultivating the network effect through customer advocacy. This requires that you engage with your customers individually and as a community, nurture and cultivate the loyal advocates and create mediums to facilitate customer interaction. You make it easy for your customers to share their experience and spread the word about you, which will in turn help your company connect with more buyers.
Research shows that customers coming through advocacy usually become advocates themselves. This is the business case – advocates create other advocates for you.
Customer advocacy involves collaboration between your customer success and marketing teams. Your customer success team drives efforts to empower customers, shows them the value that they are getting from your products, and then suggests what more they could do.
Marketing amplifies the voice of your customer advocates across social media and online communities to enable them to influence others in the buying community, and then recognizes them for participating. Executed well, customer advocacy programs deliver a powerful expansion to your selling abilities and present opportunities to differentiate.
Companies that place the customer at the heart of everything they do, from product and service design to the entire customer experience, will reap real benefits through increased customer loyalty and retention.
Omid Razavi is a cloud sales and customer success leader and currently advisor to software and technology companies to grow and/or transform their sales, services and operations for the cloud. Dr. Razavi has over 20 years of leadership experience in managing sales and services at various companies in Silicon Valley. He may be reached at LinkedIn and Twitter.