how inside sales is affecting cloud sales success
TRANSCRIPT
April 21, 2016
“Bottom Line Margin to Top Line Revenue”:The Evolving Value of Hi-Tech Inside Sales
Tim Killenberg, SVP-Sales + Marketing @ N3Sean Ryan, Principal @ Alexander Group, Inc.
Copyright N3, LLC No part or process to be used without permission.
A Shared Passion for Technology Sales Success
• 10+ years of global outsourced Inside Sales execution
• Technology + Software focus; Cloud Sales expertise
• Demand Generation + Full-Cycle Sales partnerships with Microsoft, IBM, HP, Dell and more
• 30+ years of sales effectiveness consulting
• Heavy focus on high-tech sector
• Dozens of Inside Sales engagements with both "new-build" and existing IS organizations
Copyright N3, LLC No part or process to be used without permission.
Key Themes…
• Technology has Transformed Buying and Selling Behavior
• Cloud Technology is Radically Changing GTM Strategies
• Roadmap for the New Inside Sales Model
Copyright N3, LLC No part or process to be used without permission.
Technology Transforms Customer Buying Behavior
• Services are bought and delivered when and where the buyer needs them
• Buyer only pays for the portion of the services they use
• Buying the service is easy to do independently
• Buying process allows you to pick and choose services vs. “all in”
• Buyer is not responsible for the cost of maintenance associated with the service
Copyright N3, LLC No part or process to be used without permission.
Cloud Technology is Changing GTM Strategies
• OpEx vs. CapEx
• Monthly Subscription vs. Million $ Metal
• Low Cost of Entry / Exit vs. “Moat Mentality”
• Unlimited Target Market vs. Enterprise-centric
• Individual Buyer vs. Buying Team; LOB vs. IT
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How is Cloud Redefining GTM Sales Opportunity?
• Net New + New Revenue Levers
• Multiple/Differentiated Sales Motions
• Scale + Speed of Voice of Customer
Territory Coverage
Enterprise Mid-Market SMB
Adoption
Sale
Consumption
Retention
Sal
es S
kills
et
InsideSales
FieldSales
Insight
Inside Sales value evolving to “Top Line Revenue” and “Specialized Sales Skills” vs. “Bottom Line COS Margin Efficiency” and “Early Stage Lead Gen”
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Sales Roles are Becoming More Specialized
THE TRADITIONAL SALES STRATEGY MATRIX…
Pro
spec
tsC
usto
mer
sBuy
ers
Products / Services
Current New
Today’s Rep Focus
Pro
spec
tsE
xist
ing
Clie
nt /
New
Buy
erE
xist
ing
Buy
er
Buy
ers
Products / Services
Current New
…HAS EVOLVED TO REFLECT CLOUD BUYING PROCESSES
Hunting in the Wild
Hunting in the Zoo
Customer Success
Contract RenewalsSource: AGI Cloud Sales Index (2014-16)
New Buying Motions Require a Portfolio of Cloud Selling Roles
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Essential IS Roles for Selling in the Cloud
Enterprise Mid-Market SMB
Adoption
Sale
Consumption
Retention
Sal
es S
kills
et
ICSM
Territory Coverage
Qualification
Lead Gen
ISSIOGR
IOGR: Inside Opportunity Generation Rep• Opportunity ID (below Enterprise)• Communicate value to customers, qualifies beyond
BANT• Convert Opportunities into Revenue
ISS: Inside Sales Specialist• Pre-sales Technical Support• Convert Opportunities into Revenue• May also support Renewal efforts
ICSM: Inside Customer Success Manager• Drives onboarding and adoption• Ensures solutions are creating customer value• Creates a hedge against competitive threats
Source: http://www.alexandergroup.com/blog/inside-sales/the-rise-of-inside-sales-and-three-inside-roles-you-should-consider/v
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Sales Roles Deployment by SegmentTraditional SW Vendors are adding Inside resources, particularly down market, attempting to mirror models that Pure Plays have mad successful
Source: AGI Cloud Sales Index (2014-16)
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Customer Needs + Economics Drive IS Proliferation
1. Transactional sales motion
2. Mature customer relationships
3. Unworkable account spans
4. Unproductive Field prospecting
5. High nurturing requirement
Traditional Inside Sales
Criteria
Cloud Accelerators
1. Multiple (dispersed) influencers
2. Shorter sales cycles
3. Smaller initial deal size
4. Try and buy acquisition
5. Easy demo configuration
Source: AGI Cloud Sales Index (2014-16)
2014
2016
$-
$200
$400
$600
$800
$1,00
0
$625
$950
$450
$750
InsideOutside
Average BD Rep Annual Contract Value
(all participants, $K)
Gap between Outside and Inside productivity per rep declined from ~30% in 2014 to ~20% in 2016
Factoring in IS cost advantage- Inside Sales selling motion is ~16% more efficient on a bookings yield basis than Outside
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KPIs for Inside Sales Success in Cloud Marketplace
• Conversion: Quota-based Revenue Delivery vs. Lead Generation
• Competency: Sales Acumen across Acquisition and Consumption
• Coverage: Segment-specific Fluency vs. Volume Management
• Contribution: Scale Potential to Drive Financial / Strategic Growth
In a recent Alexander Group survey*, 1,300+ Field Sales Reps estimated that about 70% of their contact time with customers was over the phone, email or
video-conferencing, begging the question, what is the difference between field and inside sales?
Source: http://www.alexandergroup.com/blog/inside-sales/the-rise-of-inside-sales-and-three-inside-roles-you-should-consider/
Copyright N3, LLC No part or process to be used without permission.
KPIs for Outsourced vs. Insourced Model
• Extensive Cloud Sales Experience
• Proven Cloud Sales Expertise
• Consistent / Compelling ROI Delivery
• Scalable / Global Platform
*Source: SiriusDecisions
In a recent SiriusDecisions report* on outsourcing Inside Sales, “…for long-term success, marketing and sales leaders should foster a more holistic relationship that embeds the vendor as a true partner operating as an
extension of the organization’s team.”
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Microsoft Azure Case Study
Azure Goals Results• Accelerate adoption of
Azure by converting free trials to ongoing paying customers (ACQUISITION)
• Enable current customers to increase consumption (CONSUMPTION)
• Increase overall Azure revenue (ROI)
N3 Deployment• Deploy team of LOB and IT
Inside Sales Experts in 5 countries in 4 weeks
• Segment sales motions across specialized team resources covering Buyer Journey + Revenue stages
• Leverage MAP strategy to prioritize and customize sales engagement
• Drove 10s of 1,000s of net new Azure customers
• Delivered +115% of Revenue goal for two consecutive years
• Over 83% of program revenue attributed to Tele-Sales motion