This link has been bookmarked by 1 people . It was first bookmarked on 10 Sep 2008, by Jim McClintock.
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10 Sep 08
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On-demand software is now routinely associated with fast time to value when compared with its on-premise counterpart. This is because on-demand software is accessed through a browser, the data it operates on and application infrastructure is maintained by the software’s vendor, and the overall health and uptime of the application also become the vendor’s responsibility. Moreover, the utility nature of on-demand software allows the purchaser to pay only for what is being used and for as long as it is being used, resulting in recurring but smaller operating expense financial commitments than the capital expense required by equivalent on-premise software solutions.
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To compensate for the smaller size of each contract and slower revenue flow that is recognized as the service is delivered, the on-demand software vendor must sell to more customers at any one period of time. This is where the concept of sales velocity comes in.
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Marketing must view sales as their customer and understand their role in the sales cycle. Likewise, sales must recognize the need to provide constant feedback to marketing and for quick follow-up of leads and sales opportunities.
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majority of the sales leads for SaaS companies should come through the internet (because of the channel’s low costs)
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important for the company to invest in email programs, Search Engine Marketing and optimization (SEM/SEO) programs and tools, e.g., A/B testing,
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One of the most important marketing investments a SaaS company can make is in its web site.
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rich self service functionality so that the visitor will have the ability to learn about the company and its solutions at his pace with no perceived sales pressure;
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multiple communication channels (IM, SMS, Email, chat) for the visitor to connect with the company at any time he chooses;
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functionality that turns every interaction into an opportunity to gather pertinent information from the visitor, e.g., registration, surveys, cookies, tagging etc;
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content through self-guided demos, replays of webinars, white papers, blog, trial software, and the corporate social network.
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The sales organization must have a well-defined, metrics-driven process that begins with marketing handing a lead to sales, and ends with the handing of a signed customer to the company’s operations and support services group. Every step of progressing an opportunity must be identified and the right people in the sales organization must own it. The performance of each member in the sales organization must be constantly evaluated against the metrics associated with each step (e.g., how many calls does it take for a lead to be converted to an opportunity, what percentage of the leads become opportunities, how long does an opportunity remain in specific sales stage steps, business conversion rates etc.).
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SaaS deals tend to be smaller by dollar value when compared to corresponding enterprise software sales deals. To compensate for this reality, as soon as the close of the first deal with a customer, SaaS companies need to start working on expanding the initial opportunity. The fast time to value that characterizes on-demand software provides the reason for this expansion. But to uncover such follow-on opportunities it is necessary to establish and maintain a constant dialog with the customer.
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