Enterprise software sales to enterprises

Enterprise software sales in India is enterprise sales. This has major implications for all of us who are trying to evangelize SAAS as a means of delivery as well as recurring revenue collection.

Enterprise software salesWhat do I mean by “enterprise sales”? It means a sales process which is definitely non-transactional. It means that no matter how you choose to deploy your software, the customer will not buy on the phone or on the web. It means that you can’t win in enterprise software sales by demo over the internet. It means that you need a direct sales team who will need to make face to face calls.

The direct consequences are not limited to the need for a direct sales force. You need to be prepared to customize every time- no matter if the number of users is 5 or 500. The only “Off the shelf” software customers in India buy is MS-Office! For every thing else, there is customization.

Most customization is trivial- but, the catch is that it makes sense only to one customer and none else. There are of course, those customization requests that have significantly enriched our product. That is, they have become part of the mainstream product. Many reports are examples of requests that came from customers. Location tracking of traveling salesmen, service executives etc were customer requests.

The benefit of face to face selling is that you understand the customer business process really well. So, you know if your product is a good fit or will fit only at a stretch. But, I am not convinced face to face selling works for the enterprise software sales on SAAS platform. The upfront cost of acquisition is very high; so, the customer needs to stay with you for 3-4 years for you to break even – for a moderate ticket sale (20 or less licenses).

SAAS is meant to be a friction-less delivery model- but, this assumes that from the time of initial evaluation to adoption to use and re-use, though repeated payment and renewal cycle, it is “low-touch”. But, low touch can lead to low adoption as well- which leads to disengaged customers. Disengaged customers switch and while the switching cost is moderately high for an enterprise software product, the vendor makes a loss if the customer switches early in the adoption cycle.

So, what is the solution? Someday, the realization will dawn on everyone that by being a little flexible and bending your own business process to how the software works – and as it does for many others- you will have a faster and more successful adoption and also cheaper software. Till such time, we vendors and customers will continue to chase the mirage of custom built software paid for with the flexibility of per user per month.

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