A few weeks ago I was chatting with a guy that specializes in something called “disruption consulting”. Basically he goes into mature companies and works with their management teams to help them think through how they would disrupt their own business. This is a healthy exercise for large, successful organizations and something individuals ought to think about with regard to their own company and — more importantly — their own role in their own company.
This got me thinking about enterprise SaaS sales and the theory that salespeople have become less of a necessity in this new world. As I’ve written in the past I actually think the opposite is true. Sales is growing, not shrinking, in importance. That said, here are some of the trends that I’ve seen out there that are giving the skeptics some ammunition:
- Micro budgets. With the ‘consumerization’ of enterprise software, lots of companies are letting their employees directly buy and expense their own productivity tools circumventing the traditional buying process.
- Pay-per-use contracts. Traditionally enterprise salespeople have sold large buckets of access to their software — e.g. Salesforce has negotiable pricing tiers based on the number of licenses purchased. Companies like Slack and others are getting away from this model and are pricing based on who actually uses the system. At the end of a month, they look at how many people logged-in and then send an invoice accordingly. This pushes the revenue responsibility pendulum far away from sales and much closer to product.
- Freemium enterprise software. This is a model where software can be accessed for free by an individual employee and an enterprise deal gets triggered at some critical mass of employee usage (e.g. B2E2B).
- Standardized contracts. More enterprise software companies are creating click-through agreements that can’t be negotiated by the buyer. And there does seem to be a very slow but steady move towards more consistency across companies in what they want a contract to look like. Corporate attorneys will make this really difficult, but the idea does seem to be gaining momentum.
- Data in the cloud. The advent of the cloud has made the old-fashioned, big, CIO-based sale a bit less prominent. Cloud-based software programs require much less of an implementation burden and thus much less of the need to sell the bureaucratic IT department. That said, much of the work these teams do has moved towards integration into the cloud, which still requires a hefty sales process.
There’s no doubt that the landscape in enterprise sales has changed. And all of these trends are worth watching. But what the skeptics miss is that this is nothing new. Buyers and sellers always been trying to minimize the cost of their transactions. These are just new variations of that process. It simply means that to stay relevant enterprise salespeople must continue to shift their energy towards larger, more complex deals and higher value sales activity.
When real estate listings became available to everyone on the web, real estate brokers didn’t disappear (in fact, there are more of them now). They simply started focusing on higher value activity. Instead of their core asset being access to listings, their new asset is helping someone navigate the process of buying a home (over half of home buyers find their home online, but 90% still use a broker to make the purchase).
Similarly, when employees begin buying their own software, enterprise sales teams will just shift their activity towards more strategic, higher value deals. They’ll focus on the things that can’t be bought or implemented by a single employee.
In short, enterprise sales drives new and incremental growth. It’s the hard stuff. The easy stuff gets automated. And diffusion of the greatest innovations and the highest value deals can’t be automated.
Companies that aren’t growing their enterprise sales teams are likely either very early-stage and don’t have enough product to sell, or they’re later stage and aren’t trying hard enough.