How to sell Fortune 500 to the state and other terrible organizations

Original author: Patrick McKenzie
  • Transfer
imageIf you sell software, then surely at the sight of the budgets of large corporations they thought about how you could bite off a piece of this pie. Personally, we at , a project about payment systems, are constantly looking for ways to get partners to major payment systems or services for advertising services, development, or even help in maintaining a blog on Habré. This translation article will discuss how to work with large fish. I would immediately like to warn that our realities are different from the Western ones, which are described in the article, but in some ways they intersect, so it’s interesting to read.

Many people wonder about selling software to awesome large organizations. Working with such cool companies in the price range you set is extremely difficult, since any values ​​below $ 500 for them look like a rounding error. At the same time, the presence of a pair of such customers will give you social significance, which allows you to sell both to other such giants and smaller customers. With IBM as a customer, you won’t lose anything. Well, if at the same time no one was fired at IBM for choosing you as a supplier, then you are quite suitable for a big game.

Many ordinary engineers have a misconception that selling to cool and large companies requires the ability to play golf, invite customers to dinner with a steak, and have a budget that goes far beyond the capabilities of a small business. This is true, but not 100%: you can always use the procurement process of large companies and benefit from it. Let's dig deeper into the question of how exactly this can be done.

Understanding the B2B supply cycle and using its features for your own purposes

Most of those who are reading this text have already seen half the B2B supply cycle in their usual work. You fill out the form or ask the manager about what you need (copies of MSOffice, a new computer, etc.) and six weeks later it appears with you. Maybe you even imagined that all these six weeks, separating you from the thing you need, are required to conduct proper dark rituals with the aim of summoning supernatural powers? No, this is all nonsense. You just do not talk about this to the procurement department, because they value their reputation. Now I will describe to you the usual workflow that large businesses use to buy something “small enough,” that is, orders whose price contains less than six characters. If you know everything about this, feel free to skip this section, because the most delicious will be after it.

1. The user needs something. A user within the company (for example, an ordinary, ordinary employee) finds out that he needs something and asks about it.

2. The procurement manager is looking for suitable options. The user either knows about a suitable option from the very beginning, or an employee of the procurement department is looking for it. At the same time, he usually does this in the same way as a simple user - Google, from time to time checking the “Internal List of Suppliers” with which the company worked before and never at the same time sued for poor delivery.

3. The procurement manager verifies compliance. The person who is responsible for completing the acquisition interviews several business suppliers to determine whether their products meet the requirements specified in the relevant documents (which, incidentally, was most likely filled by another person). This stage often includes a pivot table with a list of approved requirements (did you notice how much they look like these disgusting tables with checkboxes that you saw on the site of your competitors? Yes, they also know the rules of this game). The answers to the vast majority of questions in such a table are stupidly obvious. And, nevertheless, you will need to answer them on the website, which the procurement manager scanned quickly and decided that it is much easier for him to give them to you to fill out.

4. The procurement manager requests a quote. Companies that send back a table in which almost all requirements are marked receive a request for a quotation. It is a written confirmation that the product X is available for purchase at the price of Y, without any nuances or tricks (in fact, there are always a lot of tricks and nuances, but this document forces us to identify the most obvious of them. Well, or, by at least the purchasing department thinks so). In most cases, when making small purchases (again, less than 6 characters in price), the procurement manager will request only one quotation.

5. The procurement department submits a purchase order, which is a paper document, saying: “We accept your offer to purchase product X at price Y and request delivery with payment after delivery, according to the following conditions, which we are likely to care will violate. ”

6a. The business supplier delivers the order. You know this part, right? You deliver your product to a specific employee of the company, whose name is indicated in the documents. Perhaps he will be somewhat outraged by the fact that he had to wait only a mere six short weeks. His purchasing manager may not have informed him of the status of the request.

6b. (Around the same time) The business provider sends the invoice for payment to the corresponding customer account. That is, you send an invoice for payment (a formal requirement to make a payment) to the department that is responsible for paying the bills. Depending on the specifics of your client’s organizational structure, this may be the same procurement department or some other department.

7. Payment of the invoice. Further, the business supplier receives payment in the manner that he designated in the invoice for payment. Although, in fact, they, of course, will ignore your instructions (especially those regarding deadlines).

The easiest way to “crack” the purchasing process

Your users inside the client company hate the procurement process because it creates obstacles for them in the performance of their duties. The meaning of successful sales within the framework of working with large companies is to find your favorite inside such a company who needs your product “like air” and make this person his ally in the fight against his own employer. One of the easiest ways to achieve this is to let them use any loophole they can find in their supply department.

All this gimp on the approval of any order is equal to the salary of the decision-making employee, so most of the supply departments have several certain restrictions. One of them is the upper limit of costs that a lower-level manager or a simple employee can approve on their own, without any ceremony, taking advantage of financing from corporate credit cards. This limit is usually $ 500 or $ 1,000. The best hack that software companies have come up with over the past 20 years is monthly billing.

This practice allows you to sell products worth several thousand dollars, dividing them into payments of $ 499 per month, avoiding the supply controls inside your client companies that prevent your users from doing their work. The reason why almost every SaaS business should set the price of their price plans in the range from $ 250 to $ 499 per month is because your customers' employees can easily charge such expenses to a corporate card. For them it’s someone else’s money, therefore, it doesn’t matter to them what amount they are talking about - $ 99, $ 250, or $ 4999 per month. For large organizations, all these figures look like rounding errors and they simply do not bother to control such small purchases. Based on the foregoing, you should set a price,

Some businesses do not use corporate credit cards and will require you to send them a purchase order every time. In this case, your policy should be as follows: “we are pleased to provide you with purchase orders subject to your annual prepayment (you can add the tariff plan requirements here”). This eliminates the need for stamping monthly purchase orders worth several hundred dollars — an activity you would rather avoid. Your customers will also be happy with this approach, because they, in turn, hate to go through the approval process.

We circumvent the objection that "your company is too small."

In the course of your activity, you may encounter transfers exceeding $ 500, as well as meet a more conservative business compared to the usual megacorporation. In working with such companies, almost the only serious obstacle arises at 2 or 3 stages of the delivery process. The typical phrase that you will hear from companies at this stage is: “We do not want to be your largest customer.” There are several ways to mitigate this objection that I shamelessly stole from my friend Jason Cohen of WPEngine .

The best option is to play in contrast to the level of your services and the services of competitors. You always come out the winner in this comparison: you just need to choose the right words and then even the fact that your competitor, for example, offers phone support, but you do not, will not play any role.

Magic words that will help you: “I appreciate your choice of brand X. You think that they are a more reliable company. They really can answer your call at 2 a.m., but unfortunately they can’t do anything for you. They will only try their best to make you hang up without talking to those who can solve your problem, because the services of such people cost money. In addition, you yourself know what will happen if you call at 2 p.m., the same person will answer you. ”

“On the other hand, during electronic correspondence with us, the answer may take several hours, but each time you will receive everything you need directly from me, and I will do everything in my power to solve your problem. "I created this product from scratch, and I am very fanatical about the quality of the services that I provide you, because then you will probably become the largest of all my clients, and if I do not care about you, my business will end."

This, by the way, is the magical advantage of the founder of the company. Customers hate to talk with sales managers, because they are too intrusive, unable to provide all the necessary information. Clients like to communicate with the founders of companies: they talk about their products with undisguised passion and always, always know the answers to all questions, or at least know how to get them. You can even take advantage of the founder’s advantage so that your answer: “We would love to do it, but due to X, Y or Z, at the moment it’s unrealistic” will sound better than your competitor’s answer in the spirit: “Yes, of course we also do this, shall I add this to the price? ”

Developing social significance for working with large businesses

My last software business, Appointment Reminder , is now a 1-person company that occasionally works with freelancers. One well-known hospital in the country included Appointment Reminder in the list of 12 companies that received from her a list of their project requirements, for which she needed an event notification system. Why is my service included in this list? Because it is on the first place in the Google search for the keyword “appointment reminder”, but “since Google chose you ...”. Yes, seriously, I quote their words.

The project the hospital was working on did not have a six-figure budget (the amount is protected by a non-disclosure agreement, but let's say that we are talking about ten thousand dollars. This is not so, but it could have been so). Therefore, realizing that good percentages should not be expected, the sales teams of my competitors limited themselves to sending standard answers describing the capabilities of their software and did not pursue this sale.

I can’t say that 10 thousand is a figure that can seriously motivate me too (believe me, I never thought that I would ever think so anyway), but I decided that I really need this client as the basis for the Appoint client base Reminder. I wanted to be able to use their logo on my website as evidence of social significance. This would allow me to punch my way into the large and incredibly lucrative healthcare market. In the end, I just threw hospital staff with answers to their questions and concerns.

You can triumph in any competition, no matter how large or complex it seems. This can be done by winning small, economically unprofitable transactions for large companies, expanding at their expense and gaining access to the main business areas of such companies. Clayton Christensen calls it "disruptive innovation." Personally, an old instruction appears in my head about how to eat an elephant: bite off in small pieces, starting from the most vulnerable place, that is, the belly.

Twelve suppliers were interviewed about whether their products would meet the needs of the hospital. My competitors were different companies, ranging from specialized consulting agencies, numbering 10 people to companies from the Fortune 500 list. They all simply sent standard letters with a list of software features attached to them.

The length of my letters was at least 2000 words. Each paragraph in them began with headings of the form “* Differentiation of public accounts: present”, followed by 200 words explaining why this is generally important for this particular hospital (advice to copywriters No. 1: When talking with anyone, always refer to a person by name, the same applies to the name of his employer and do not be afraid to go too far. This will allow you to make friends and gain influence over people. This is a classic of the genre that never expires). I also suggested sending a copy of each of my letters to the internal team working on the project so that they would also be in the know.

The hospital wanted to have an additional telephone discussion of Appointment Reminder, as well as another major competitor that formally met the requested requirements. Suffice it to say that their annual sales are expressed in eight-digit amounts, and the number of person-years that they spend on software development exceeds my performance by 100 times. In theory, I should have lost to them in any fight, regardless of the circumstances. Their sales representative answered the questions by telephone very superficially and without much interest, so as to quickly return to their more promising customers.

When the hospital asked me for a phone call, I remembered the name of the nurse who was responsible for the purchase (let's call her Jill) and thanked her for conducting electronic correspondence. After that, I again introduced myself as “the person responsible for the product.” She asked questions. Answering them, I constantly told her: “I can go into details as much as you like, if you want it, but, in short, I think that * what we are talking about * is necessary for your hospital. I will be happy to tell you more if you want. ”

When we got to the really difficult questions, I said: “Right now I’m not ready to give a definite answer to your question, but I will certainly answer it additionally and in more detail by e-mail”. Immediately after a telephone conversation, I sent her a letter (and again with a request to send a copy to the internal team), which gave answers to absolutely all the questions that we had previously discussed, separately indicating at the very beginning that paragraphs 3, 7 and 9 relate to questions, to which I promised to answer separately.

It's funny that during a telephone conversation, Jill asked: “I just want to know from you, is this product your child? That is, as I understand it, are you the only one working on it? ” And I said that in short, yes. After that, I used a variation on the Jason method and said: “This company consists of one person and although, in the future, I may have subordinates, I currently do not have them. I wrote this product myself, I answer all questions and provide all the support myself. And of course, as you said, I take good care of my child. ”

To make a decision about which product to continue working with, the hospital held an internal meeting, which was attended by 10 people. Each of them, except for Jill, referred to the meeting as “a choice between the Appointment Reminder and“ that second company ”, about which few even remembered anything.” The inboxes of their mailboxes contained two letters with lengthy comments from Patrick from Appointment Reminder and a PDF file sent by the “man” whom the doctors promised to read when they did not need to save lives. The head doctor wanted to dwell on a competitor. Jill narrated the story of the “child,” expressing his ardent personal support.

That's how I beat my biggest competitor and won a corporate sale, working on my business alone from Japan. If you are curious to know what kind of hospital it is, check back from time to time for the Appointment Reminder homepage, as I can only get permission to publicly mention their name after a few months.

I will not lie to you: selling to corporations is a long and hard job. In general, the paper work on this project took 25 hours of my time, stretching for a full six months. And besides this, there were a dozen other stories that began and ended before reaching the stage of extensive telephone discussions. But now, finally, the sale has been made, and the bridgehead for the further offensive on the incredibly profitable market segment, which is not easy to get into, is prepared.

Interestingly, having received such a bridgehead, expanding it becomes much easier. Now, to any of the following objections in the spirit: “But you are too small!”, I got the opportunity to answer: “* THIS_COMPANY * have already chosen me, but if you still doubt ...” Moreover, in addition to this, it turned out that The hospital that used this service did this together with several partner hospitals, each of which had its own reputation. Essentially, it turned out that I got 8 logos for the portfolio for the price of one.

Sometimes customers want to work with you at corporate rates and this is normal.
Gradually, from constant and thorough personal contact, you move on to the established automated sales scheme through your website. That is how I always saw this process, given that I myself had experience working with sales that did not require personal contact. Sales managers look at it this way: “You learn about the existence of some hundreds of prospective customers, select 20 of them who are most likely to be interested in buying your product. Next, call key decision makers and talk to them over the phone. Half of these conversations are constructive. Three customers agree to a demo presentation, and one of them becomes your sale, and you get a bonus. "

Ultimately, there will come a moment when you have a desire to stop making all sales personally, as one of the founders, who have to arrange lengthy performances each time. This desire will lead you to the great and terrible Automated and Structured Sales Funnel. Although you, of course, can find ways to get around the need to have established sales processes (and with them the sales team). Such non-standard strategies can also well turn into “adapted to real conditions” ways of selling to corporations in the future.

For example, a large company that successfully uses the price plan of $ 250 per month could very well be happy to switch to a contract of $ 5,000 if you offered them the appropriate incentive. You are probably asking yourself: “Seriously, twenty times more ?!”. Take a different look at this: for them, it’s about a transition from a “pocket change” to a “bill of a few hundred.” Stop thinking like an ordinary person, think like a corporation. Corporations behave like people whose smallest monetary increase is equivalent to the largest salary you have ever received.

How would you single out those who need a higher price offer in a separate customer segment? In many cases, they will give themselves away by asking you questions such as: “Does your software have the ability to audit?”

There are three easy answers to this question:
  • Unfortunately not.
  • Unfortunately, there are no such functions, but we can introduce them for you.
  • Oh sure. We just need to do this, this and this and this, and they will appear immediately.

Kill yourself properly if you ever say something like that in return.

The word “audit” is one of those whose pronunciation out loud in working with a corporation provokes a sharp increase in prices. (Examples of other such words and phrases: legislative requirements, administrator, access rights, network protection, multilingual, service and others) Companies that really can afford to think about an audit have a huge amount of money. Therefore, the correct answer would be a variation on the theme “We provide our corporate clients with all the necessary capabilities for conducting an audit. When will it be convenient for you to discuss the details? ” After that, you complete the transaction at an undisclosed corporate price tag, which is likely to amount to several thousand dollars.

An important point: there is a big gap between corporate and regular price levels. If, for example, your monthly plan costs $ 250 and provides you access to 500 units of some garbage, and the corporation needs 5,000 units, it will cost it several thousand or tens of thousands of dollars a month. Even if she needs only 500 units, the cost will still be several thousand or tens of thousands of dollars per month. Or maybe she needs only 50 units? It doesn’t matter if it costs the same several thousand or tens of thousands of dollars a month. This approach is partially justified by the amount of hemorrhoids that you subscribe to, starting to engage in corporate sales. However, in general, this is simply pure, undisguised price discrimination. Large businesses are practically price insensitive *. Do not even try to sell them, guided by their usual prices. (* We are talking about price guidelines for software companies.)

I have met many developers who learn about pricing, mainly studying other people's SaaS prices. The ability to pay some relatively high price for any SaaS that you have ever heard of always exists, even if the pricing page does not say so in plain text. I know about companies that have their own policies against this (for example, 37signals are well-known adherents of this approach), but there are many successful SaaS companies that have the magic leverage that can send you very far from the range of their standard prices. And often, the existence of such a phenomenon is never written anywhere.

Here is an example that will definitely not hurt anyone: Github offers a corporate tariff, and the feature that allows you to distinguish such customers in a separate segment is the possibility of using the service “within its corporate network”. Do you know that you can use a Github account and easily pay five- or six-figure amounts for its annual use? It’s easy to guess where Github makes more money: on all of their accounts that pay $ 7 per month, combined or on one of the largest corporate client? Personally, I have no doubt about this.

We work to increase profitability

Sometimes it happens that customers can’t just take it and say to you: “Dude, I don’t care what your price is, kindly take 20 times more from me.” Often, however, this can manifest itself in their behavior. Suppose, for example, that you want to bring them up for discussion of audit functionality. You can simply put the text “Contact us” in the price column on the tariff page. Most of your customers know the rules of the game and rightly regard it as: “We provide services to large businesses and these services, as you can expect, are expensive.” This is a great way to get a whole bunch of leads without involving the project founders in this process.

Also, have you ever considered the opportunity to talk about expanding services through the software itself? For example, you can leave the option “Enable functionality for audit” in the menu on the account settings page. Let clicking on this option bring up a window with the message: “Your tariff plan does not include functionality for auditing, but you can always contact us by clicking * this * link". And for those who will not use the link, make sure that you automatically receive an email notification that Bob Smith ( was interested in the functionality for auditing. Then you can already contact Bob in person. In this simple way, you will turn 5 minutes of your programming into a whole automated process of receiving six-digit transactions and you will be well done.

If you are embarrassed by this approach, you can always write a short text that briefly informs the client: “Audit: Click here to book a phone call with our sales department about the audit functionality.” However, for you it will simply turn into an additional waste of time. Believe me, only you, but not your customers, will notice the difference between these two approaches. In the end, this is not the first time they have seen this: as a large company, they have relevant organizational experience, which has thousands of such procurement cases.

There is another way, which is often called “drip marketing”. Its essence is to send customers a series of letters, some of which are educational in nature, and the other part is used to increase their sales. That is, first you honestly teach your users how to properly use the software to solve their problems, after which the content of the newsletter gradually changes in the direction of advertising the benefits of switching to the corporate models that you offer.

You can approach this process more carefully by sending a newsletter only to those people whose accounts suggest a possible transition to a corporate plan. Personally, it seems to me optimal to send each new registered user something like “a monthly course on how to get the most out of X”. Thanks to this, customers will react positively to the first letters of the series, and already in the second part, if it does not interest them, you can give the opportunity to unsubscribe from the newsletter with one click.

You can promote the benefits of your corporate services, such as a dedicated support team, service level agreement, and just about anything else. A satisfied internal client will be able to realize the benefits of an upgrade or (which is also very useful for you) will be forced to use them according to the internal regulations of his employer. One way or another, such mailings can give rise to very productive dialogs between the client and your sales team.

If you do not understand what I mean by “internal regulations,” I will give you an example. Imagine a price department that has already run into a poor-quality software purchase. Suppose that such a department has a special clause in the contract: “Any software purchased must include one year of maintenance and, in the event of an incident, guarantee the provision of services of the second support line within 6 hours.” Do you know what this means for you? This means that as soon as such a department finds out that a tariff plan worth $ 250 is provided without an agreement on the level of services, it will reject the order for its purchase and require its own company to switch to a plan with a monthly cost of $ 5000.

And one more way. After all, do you have a special panel where all customers who filed an application are automatically recorded? (OR NO?) So, if you see that there is a new email that ends on, make sure that they receive a hand-signed letter from one of the founders or the project manager with a proposal to discuss the problems they wanted would decide. (You can send such letters to everyone who comes in contact with you, however, personally, I would prefer to devote more of my attention to the dialogue with the user from, and not with the owner of the usual gmail address.)

Everyone can sell to large businesses

One of the most common objections that I hear from guys who want to move further into more expensive segments of the market - they are not suitable for the role of the Seller. Guys, believe me, there was a time when I was racing in World of Warcraft, and during the conversation I still often stare at my own shoes. There is no one who would be suitable for the role of the seller less than me. And yet, selling is the same skill as everyone else. Just try it. You will fail several times, but in the end, you will improve your skills. When I started making Appointment Reminder sales, the conversion, you know, was only 5%. And now it has grown to 20%, however, compared with the formidable budgets of companies that work in this area of ​​the market, these 20% will turn out to be an extremely small amount of money. My father used to give me one soothing piece of advice regarding finding your second half: “Stop coming up with excuses about why you're not from their league. Make them want to be in yourselves, and then, one fine day, someone, maybe someone extraordinary, will appear and say “yes.” This advice, by the way, is good in the original context.

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