This post was originally published in TechCrunch on November 7th, 2023.
Nailing go-to-market (GTM) as a startup is hard. But nailing GTM as an enterprise startup in a down market is exceptionally harder.
During the market peak of 2020–2021, startups enjoyed excess capital and a “growth at all cost” mentality, while enterprises had the financial flexibility and budgets to throw at new vendors and technologies. However, 2023 has proven to be a long and difficult road in a post-ZIRP (zero-interest-rate policy) world.
With significant macroeconomic shifts, enterprise budgets are now under intense scrutiny. Buyers are responsible for immediate ROI (return on investment) and require more stakeholder approval to push software purchases through. These constrained budgets have resulted in prolonged sales cycles and higher churn. Meanwhile, startups are confronted with not only a steep uphill battle to secure commercial sales repeatability, but also expectations of efficiency.
As an enterprise software seed investor at Work-Bench, I’ve seen companies utilize a few key GTM tactics to help them (1) close deals and (2) avoid unnecessary pitfalls that put potential deals at risk. Below are my three GTM tactics every enterprise founder (and sales team) needs to drive urgency in order to survive today’s market.
1. Tie All Messaging Back to ROI
Discovery and demo calls with prospects are often the make-it or break-it touchpoint that sets up the success of the rest of the sale process. However, the #1 trap many founders and Sales reps fall into is using this limited (and precious!) time by immediately diving into a product demo and feature description. This isn’t surprising, given how much effort goes into building a product. However, it fails to demonstrate how the product will solve the prospect’s business challenges.
How do you best understand a prospect’s business challenges? Asking the right discovery questions is critical, to uncover:
- What are their challenges?
- Why are they suffering from these challenges?
- What have they tried already (if anything)? Why didn’t it work?
- Share outcomes, not features / capabilities / demo
- Confirm who the decision makers are, next steps, and timing.
- What happens if they don’t solve this problem?
- What does success look like?
TACTIC: Nail down and articulate truly differentiated product messaging. Express current-state realities (metrics that underscore and “bring to life” how things work today) and then the future-state outcome (how the product can improve upon those current-state realities).
For more mature companies, demonstrate as much concrete evidence as possible with specific ROI metrics (“we’ll save you 2x revenue, cut cost 20%, reduce time by 80%,” etc.). Using a Business Value Calculator can help demonstrate the ROI for a product versus that of an home-grown tool by creating a business case, detailing how the product will impact the prospect’s business, and why now more than ever is the right time to buy. Some tips on how to think through these metrics:
- Differentiators: Make sure the value-based selling motion underscores the unique differentiators (define these internally first).
- Simple Calculations: Don't make it overly complicated — focus on a few key metrics.
- Current State vs. Future State: Include an analysis of their Current State (i.e. what will the prospect do without this product and how can this product improve it).
- Demonstrate Value: Articulate a business case that can be proved out in a trial or POC (i.e. “You take X hours and Y people, we can decrease by Z% and your net result will be X”).
2. Review (and Revisit) Deals Lost
Founders always review the deals that were won. However, what often gets overlooked is the deals that were lost. While dwelling on these missed opportunities might not appear productive, creating a centralized list of objections raised by these lost customers can reveal insightful patterns - such as implementation hurdles, interoperability issues, and feature deficiencies, among others. These patterns could shed light on possible adjacent opportunities to discover an even more urgent, high ROI product-market-fit. While some deals might be lost due to the decision to build internally or go with a competitor, it’s surprising how many of these seemingly “lost-forever” deals might stage a comeback.
TACTIC: Devote a dedicated period each month – around two to three hours – for a thorough “20 Deal Grind” session with the Sales team. The process involves delving into key aspects, including understanding the customer's profile, dissecting the rationale behind their purchase decision, analyzing factors contributing to non-purchases, evaluating the effectiveness of sales messaging and responses, and reviewing other employed tactics. Utilizing tools like Gong or a similar call recorder to record sales calls gives the opportunity to review calls and quickly iterate messaging. Then, create a library of recorded calls (both good and bad), which can serve as a learning resource for future hires during their onboarding process. Additionally, roughly twice a year, run a “closed-lost revisit” campaign to re-engage with past, lost prospects. Maybe the perceived risk associated with the offering has lessened over time or they didn’t roll out with that competitor or their internal build failed. This outreach offers a chance to rekindle relationships and explore potential opportunities that may have been overlooked in the past.
It's important to note that the intention behind this exercise is not to dwell on failures, but rather to iterate on strategies for future improvements. While simply reviewing notes in Salesforce offers some insight, it lacks the depth needed to unveil important patterns. After a few quarters of the “20 Deal Grind,” teams should see patterns, oftentime within positioning, messaging, and processes that can help uncover the most urgency. This invaluable information can help enable more effective sales efforts moving forward.
3. Don’t Forget About Support & Adoption
Many founders tend to prioritize closing the sale, then forgetting to offer post-sales support. Without a full GTM team, it’s easier to close the deal, celebrate the newly won ARR, then move on to the next deal. However, it's important to remember that implementing a new SaaS product into a company often requires a shift in workflows and behaviors, and such change is typically met with resistance. This underscores the need for some form of post-sales support - whether it involves help with integration and implementation, or onboarding of data and users, etc. This commitment to ongoing support is instrumental in achieving positive outcomes for the customer.
Support customer usage: Providing customers written resources, such as blog posts and whitepapers that address frequently asked questions is a good start. However, what really improves customer usage and satisfaction for a true enterprise SaaS product may require hands-on, personalized post-sales training, onboarding, and implementation.
Drive customer adoption: Tracking customer “adoption signals” such as growth in logins, active users, workflows, etc., can indicate the customer has woven the software into their day-to-day operations. Especially in a newer category, it’s likely customers won’t know how to measure ‘success’ with the new software. In this case, dictate what a success metric should look like, and measure it with/for them. If these adoption signals aren't evident in a customer's behavior, it's a strong indication that they might not be effectively utilizing the software and likely won’t renew their contract.
TACTIC: Weave personalized post-sales support into Sales from the onset. While a fleet of dedicated Professional Services or Customer Success reps might not be needed to cover the current customer roster, ensure someone on the Sales team is responsible for covering post-sales support. To further develop this support, establish a regular, bi-weekly or monthly meeting on the champions calendar to proactively identify friction and troubleshoot. Additionally, understand all the potential blockers in the road to full adoption for the customer, and be proactive and very explicit in guiding them along the way to ensure that adoption.
While these tactics are vital during challenging market conditions, they represent fundamental principles that should be deployed in any market – good or bad. As we move into 2024, we hope that enterprise budgets will free up, though likely never to pre-pandemic levels and efficiency will continue to be a core mindset. Therefore, it’s important for founders and Sales teams to continue to stay focused and disciplined in their GTM approach and processes.