"There's no software priced between $1000 and $75,000."
Although there are annual licences sold within this range (nearly all of our contracts are). Companies grok SaaS, whereas they probably wouldn'y have in 2004.
We do all of his wrongs, but we don't sell to small companies.
>We do all of his wrongs, but we don't sell to small companies.
I have no real experience with big companies. Could you educate me on a few points? In particular, it strikes me as odd that these would be any different from consumer to small company to big company:
Don’t hide your pricing behind a sales process
Do people shopping for solutions for big companies not have any idea what their budget is? I understand there are always details to work out in the sales process on deals like these, but it seems to me that immediately knowing that your product costs five times what I'm supposed to spend would save your sales people some time.
Don’t make me read a whitepaper in order to get essential information about your product. Put it on your website. In HTML.
A web page with a URL that isn't a mile long seems like about the easiest way there could be to read about a product and share what you've read with other people in your company. Why would you not do this in 2012?
Don’t make it hard for me to talk to a technical person at your company about the nitty gritty details of how your product works.
I know a lot of times, technical people aren't the ones making the buying decisions, but is it rare for them to be involved? It seems like some easily accessible technical information could really speed things up when the purchasing guy asks the tech guy "will this actually work for us?", or is that not how things are done?
I can think of sensible reasons people would violate the author's other demands when smaller companies aren't the target market, but these seem universal. Since I might some day make things I want to sell to bigger companies, I'd really like to understand what I'm missing.
You're thinking about buying "big business" enterprise software like buying a cell phone or any other off-the-shelf commodity. Don't do that.
It's more akin to buying a house. You've got to find one of many that satisfies your unique needs. You've got due diligence to do. You've got negotiations. You've got an entire purchasing process to follow that is externally imposed. You may have renovations to make before you can move in and need estimates on that.
A website can cover generalities, but the reality is that enterprise products are big, complicated, and (generally) are not purchased by technical people, although technical people may be involved in part of the review process or requirements analysis.
The only process more complicated is selling to the government.
I don't think I'm missing that point. To use your analogy, if I was buying a house:
1. I want to see prices when I browse listings. This is fairly normal in real estate, even though prices end up being somewhat negotiable. Why not in enterprise software?
2. I want a decent amount of information before I even pick up the phone or write an email. If you were listing houses for sale, it would be foolish not to include some photos, the location, the size and number of rooms, etc.... I don't want this information in a mixture of PDFs, MS Office files, flash animations and such. I want HTML pages that are easy to read, copy data from and email to others.
3. If I'm buying a house, I probably want to see such things as inspection reports and maintenance records. These things should be fairly easy for me to get even if they're not on the public website.
Someone explained to me that one reason companies selling enterprise software are so eager to get someone on the phone to sales rather than browsing the website is that they then feel they have something invested in the process and are less likely to back out[0]. Having always been the nerdy type, this idea was very foreign to me, but it seems to be true from what I know of the average person. I also learned from an early age how to recognize and respond appropriately to salespeople trying to use emotional and psychological tricks to manipulate me. I sometimes have an unreasonable expectation that others will do the same.
tl;dr summary: The original article mostly applies to the subset of products/services that can be sold online. Many successful companies choose to sell using different rules for good commercial reasons.
I said:
>>We do all of his wrongs, but we don't sell to small companies.
I should have said "some" not "all", however you have chosen three examples of things that we do indeed do "wrong"...
Background: we are a 6 person company with 100 clients selling to entities with 10's of employees to 1000's of employees i.e. we don't sell to large entities. We mostly charge per user per annum (plus initial setup costs of up to one years fees - cashflow needed for longer sales cycles). The company was bootstrapped, and is profitable (in the real sense of the word - not ramen profitable).
> Don’t hide your pricing behind a sales process
Our clients have a budget, and that budget varies by an order of magnitude. I think this is normal for larger entities. e.g. a government department may pay 10 times more than a company with tight margins, like a retail client. We removed pricing so that we could vary our prices according to the client. Variable costs are mostly covered by our initial setup fees, so increase in price goes straight to bottom line. Not signalling pricing was a good move.
> Don’t make me read a whitepaper in order to get essential information about your product. Put it on your website. In HTML.
We have some information on the web site, and some in PDF's. Due to variation in the client base we are careful how we disseminate much information E.g. don't advertise a feature that is confusing to some clients, or a feature that is too expensive to configure for a cheap/small client.
> Don’t make it hard for me to talk to a technical person at your company about the nitty gritty details of how your product works.
Probably doesn't apply since our sales people are technically competent. Most customers are not technical people, so shouldn't be interrupting developers. When judged appropriate, customers do have access to any of our staff.
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Perhaps another useful way to think of it is that many of his rules apply when your target market is more than say 10000 clients? Or maybe they apply in a highly competitive market?
Re Joel's article: Maybe it is a false dichotomy between small and large sales (although as a very broad approximation it may be a useful idea). I believe there are a huge number of SME/medium sized companies with a variety of sales processes where cost of sale is somewhere between $0 to $50k i.e. the stated $50k minimum hurdle doesn't exist. Sales in that range may be your sweet spot, depending upon what you are selling.
Although there are annual licences sold within this range (nearly all of our contracts are). Companies grok SaaS, whereas they probably wouldn'y have in 2004.
We do all of his wrongs, but we don't sell to small companies.