Sass, it's not a quality you want your reps to have.
But a well-rounded knowledge bank all about winning in SaaS sales? Now that's something every company selling software should embrace!
And that's precisely what we're going to cover in this guide, along with:
So, if you're keen to get started closing more and more SaaS deals, start scrolling 👇 or use the menu to jump to the section that interests you the most:
SaaS sales is the process of selling web-based software that customers access through an online portal. SaaS stands for Software as a Service and is used by businesses to solve their pain points or problems.
SaaS software is managed by a customer success team and supported by the provider's product engineers. There is usually a subscription-based pricing model, so the sales team's focus is on upselling and retaining existing clients while bringing new ones on board.
Selling Software as a Service is complex as you're not simply delivering a product as soon as you make a sale. Instead, the software needs to be supported and engineered, meaning that SaaS sales teams must build lasting customer relationships to ensure future sales.
What's more, the SaaS sales cycle will take much longer because the cost of business software can be quite high, and more players need to sign off on the final decision.
To sell SaaS, you'll need to hire both Sales Development Reps (SDRs) and Business Development Managers (BDMs). SDRs focus on outbound sales and qualifying leads, while BDMs focus on conducting product demos and closing deals.
They will need to communicate the benefits and features of the solution to buyers. Thus reps will need to be incredibly knowledgeable of how the software works to demonstrate and troubleshoot the product during demos.
A SaaS sales team has one main objective: to move sales qualified leads through the pipeline and generate new revenue for the company.
There's a common theme among all B2B companies that create software that sells - a well thought out sales process.
The SaaS sales process should be based on marketing data collected from your Ideal Customer Profile (ICP). The more you know about your total addressable market, the better you can sell software to them.
Here's a rundown on how to sell SaaS:
The B2B SaaS sales process refers to the stages a company goes through to close a deal with a potential customer.
There are 5 steps in the SaaS sales process:
To do this you’ll be looking at the utilising the 3 main SaaS sales activities:
This process will then support fuel your sales cycle and fuel your B2B SaaS sales strategy:
There are a number of factors at play when it comes to determining your sales cycle. For instance, the more expensive your SaaS product the more decision-makers involved in the purchasing process. This can significantly lengthen your cycle.
So first things first, take the pricing of your software into consideration.
Next, consider how long you’d like your contract to run for. The average length of a sales cycle is 84 days, so you’ll need to factor this in when calculating your annual contract value (ACV). Other factors you’ll need to consider are:
Thirdly, if you find your sales cycle is too long, you can take steps to shorten it by:
Lastly, if you can't shorten your sales cycle be sure to build it into your budget from the start. If you don’t it will affect your sales goals and you’ll struggle to reach your target.
Press ▶️ to better understand the stages of the B2B SaaS sales process so your team can start selling smarter!
You’ve got your fundamentals down - a well-defined sales process and a realistic sales cycle. Now what?
You’ll need to choose a SaaS sales model.
A SaaS business model will help you decide how many people you need to hire, how you’ll progress customers down your sales funnel and the steps needed for your company to evolve.
There are 3 SaaS sales models you can choose from:
A self-service sales model works best when your team is small and your average selling price is low because it’s more affordable and a good option for selling lower-priced SaaS at a higher volume. This model uses free trials to encourage users to sign up without the help of a sales rep.
If you’d like to incorporate the self-service model, you’ll utilise B2B marketing to promote your solution and its value.
A transactional model is the most common sales model as it’s the most scalable. The SaaS solution is normally higher with a larger sales team to encourage a more personalised selling approach. Outbound lead generation teams will reach out to small and medium-sized businesses to encourage a sale on a tiered pricing model.
If you’d like to include a transactional model as part of your sales strategy then you’ll need an aligned sales and marketing team, provide in-depth SaaS sales training and encourage discounts to convert more hot leads.
The third and final model is enterprise SaaS sales. This model is the most expensive and requires the most customisation and sales support. There are more than your average amount of decision-makers resulting in a longer SaaS sales funnel but the incoming revenue is well worth it.
If you want to include an enterprise sales model in your SaaS business then you’ll need your product marketers, salespeople, accountants and engineers to be aligned for better customer service, better client relationships, more signed contracts and invoices sent. In other words, you’ll need a whole RevOps team to ensure a streamlined selling process.
If you’re looking to move into a new market model, you’ll want to look into how to set revenue projections and targets that work with a go-to-market strategy. Press ▶️ for advice from sales leaders at Cognism and Bombora.
Now on to your sales strategy!
A SaaS sales strategy uses a variety of sales techniques to close as many deals or upsell to as many clients as possible.
But, there’s no ”one size fits all” approach. You need to find what works for your business and where it is in SaaS adoption and development.
A SaaS Sales strategy plays a huge role in your ability to grow and position your company for long-term success.
To reach the ultimate goal of generating revenue, your strategy should focus on:
Revolutionise the way your team sells SaaS products. All you have to do is implement 7 steps. To find out more, click to download our guide 👇.
You can’t sell SaaS without a well-rounded sales team, and according to Tomasz Tunguz’s report on benchmarking SaaS startup efficiency with revenue per employee metrics, the fastest-growing SaaS companies grow their teams by 56% each year.
That means you need to scale and fast!
But, how to build a saas sales team?
There are many factors at play when it comes to hiring a winning sales team including:
If you’re new to SaaS sales and you’re wondering if it’s a good direction to move into as a rep, it definitely is!
Here are 3 reasons why:
Since software sales is such a rapidly growing industry, it makes sense that it will create many opportunities for anyone willing to put in the time and effort to master it.
Which brings us to our next point:
First off, it helps to have previous sales experience, but if you don’t start searching for entry-level positions.
Since the SaaS tech sales are taking off, there are many startups advertising SaaS sales jobs, and often they aren’t looking for anyone great on paper. Rather, SaaS leaders are looking for passionate individuals with a passion to learn and grow.
Of course, it does help if you have a formal education to add to your resume but don’t worry if you don’t. There are loads of informal courses online that can help prepare you for a career in SaaS sales, and your employer will love that you took the initiative.
Get started learning more! Press ▶️ to uncover what sales leaders look out for when hiring Sales Development Representatives (SDRs).
Now, depending on your SaaS sales experience you can expect to land one of the following roles:
If you have 0-2 years experience you can apply for a junior SDR role. SDRs need excellent written and verbal communication skills and a strong desire to learn. SaaS sales is a fast-paced, challenging industry and meeting and exceeding sales goals and targets will be what advances your career.
2-5 years of selling experience can help place or promote you in a managerial or mid-level sales/account executive position. Sales Executives take ownership of qualified opportunities. They need to have a good understanding of CRM systems, strong analytical and communication skills, and experience in leading or mentoring others.
Senior sales reps have 5-7 years of experience. If you’re looking to advance toward a senior SaaS sales role, you’ll need to know your company's software inside and out, have strong consultative selling and C-level experience and a sharp focus on your personal goals. Ambition is key for landing a VP sales position. You’ll also need excellent analytical and problem-solving skills and great leadership qualities.
All of this sounds fantastic, but what can you expect to earn in a SaaS sales role?
Software as a service sales is commission based.
When a rep closes a deal or renews a new account, they’ll get a percentage of the deal as commission. There are different ways to structure SaaS commission from the accelerator model that increases commission for every dollar a rep brings in toward their goal, to a tiered commission rate.
A tiered commission looks at percentages of attainment whereby reps have to hit milestones in order to move on to a new tier. Then, as their performance increases so does their commission.
Every company will follow the commission structure that works for them, but one thing that remains the same throughout is that your commission will be added to a base salary.
So, how much can you expect to earn or pay junior, mid and senior reps?
According to Glassdoor, the average base salary for a junior SDR is $48,217 while Mids can earn up to $79,000 and seniors $93,000 to $114,000.
Once you have your sales team in place, you’ll want to start measuring their performance, and the only way to do that is to track Key Performance Indicators (KPIs).
Lead generation KPIs are incredibly important in the SaaS sales sector, where deals are signed and revenue is calculated on an ongoing, monthly basis.
The most important SaaS sales metrics to start off with are:
The KPIs tracked by your Sales Development Representative team should include:
The KPIs tracked by your Business Development Management team should include:
The final SaaS sales metric to look at. This involves:
To wrap up this guide, we’re sharing the top 10 tips for selling SaaS, straight from our own SDR team. Press ▶️ to watch!
The SaaS sales process can be greatly improved by the adoption of sales technology. A wide variety of tech for software sales exists which can be implemented at all stages of the sales funnel.
Through selling SaaS, it’s clear that technology has changed the way businesses and their sales teams interact with prospects. Sales automation software can help maximise productivity, streamline the sales process and make prospecting more efficient.
The most important tool a B2B SaaS team should invest in is a good CRM like Salesforce, Hubspot or Pipedrive and a sales intelligence tool to help connect with the right leads at the right time.
Press ▶️ to learn the mistakes a lot of sales teams make choosing tech for SaaS sales and why having a tech stack is so important for a successful sales strategy.
Never miss a revenue opportunity again! Cognism can help your SaaS sales team build a pipeline, prospect effectively, and reach your ideal customers when they’re most likely to buy.
Step up your B2B prospecting game today - register for your free demo with us!