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Behind The Cloud Part 4 – The Sales Playbook

Christopher Tuttle

Whenever I read a great book, I summarize it so I can learn better and recall it later.  I have been asked to make some of my “Ken’s Notes” available. Here is part 4 of  “Behind the Cloud” by Marc Benioff, the founder of salesforce.com.  Scroll to the bottom for links to the other Parts – Ken Krogue

How to Energize Your Customers into a Million-Member Sales Team

Play #37: Give it Away

They offered a free functional five user for a year. Got valuable feedback.

Play #38: Win First Customer by Treating Them Like Partners

Start with your warm market, let them use it for free in the beginning in exchange for being the beta testing bug force. Then hired a sales rep and started getting paying customers.  Initially sold month-to-month.

Use a feedback loop:

  1. Stay in touch with customers
  2. Develop a way to track their requests
  3. Respond quickly
  4. Ask if their needs are satisfactorily met
  5. Pay attention to how they use the product

Play #39: Let Your Web Site Be a Sales Rep

Got an article in the Wall Street Journal in 1999 by Don Clark, a journalist invited to the Laboratory. They got 100 leads in one day. They registered for free trials before they even talked to a sales rep.

Play #40: Make Every Customer a Member of Your Sales Team

Form evangelists of customers through training and support. Play together, partner together, and succeed together. They developed a 90 day Campaigns to Cash to Customer Cycle. Nurture prospects after 90 days.

Initiation / Demand

Inbound Qualified Leads: Word of Mouth, Internet Search, Press and News, Partner Marketing, Direct Marketing, Advertising, Webinar

Sign Up, Contact Me, Register, Web lead form

24 Hr Response: Welcome email, Welcome phone

Process: Working Leads > Qualified Leads > Differentiate/Evaluate > Presentation > Proposal > Deal

Play #41: Telesales Works (Even Though Everyone Thinks It Doesn’t)

“We broke the mold—mostly because we couldn’t afford to follow it the traditional way—and proved that telesales could win a high close rate at one-third the cost and in one-third the amount of time as the traditional selling model.” Telesales [Inside Sales] is their “corporate sales” model. The remote or web conferencing model was proven when the economy fell apart.

Outline for a Sales Call: The Top Five Points for a Winning Conversation

  1. Leverage the experience the prospect has had with other solutions.
  2. Introduce the value your product offers.
  3. Provide success stories (build and maintain a strong referral program.)
  4. Verify success stories by offering customer testimony.
  5. Provide a customer for a prospect to contact.


Play #42: Don’t Dis Your First Product with a Discount

Discounts are tied to perceived risk. Same price for two or two hundred. Special deals compromise value. Don’t undervalue your product.

Play #43: Sales Is a Numbers Game

The more salespeople hired, the more revenue rose. Nine out of ten companies fail because they don’t set up a large enough sales force and they have no way to collect enough revenue. 25 to 50% of the employees should be salespeople.

Play #44: Segment the Markets

They were initially worried about small business because of difficult collections and high attrition. 2/3rd of firms survive two years, and 44% survive four years. Rob Acker talked Marc Beniof into attacking small business.

Play #45: Leverage Times of Change

Magdalena Yesil, the first investor and member of the board recommended collecting for a year or more up front and offering a discount as an incentive versus month-to-month. Annual or multiannual contracts and volume discounts became the key to discounts. They were $50 per month, kept this price if paid cash up front, otherwise went to $65 per month. Half the customers agreed to it. An annual agreement was an opportunity to lock in favorable terms. They grandfathered old customers who didn’t want to do it for one year.

They then offered reps two months worth of sales revenue for one year deals collected up front, more for multiyear deals. This is the reason for the impressive amount of cash on the balance sheets.

Play #46: Your Seeds Are Sown, so Grow, Grow, Grow

In the beginning they cast a wide net. Then winning enterprise business became a formal objective. It also required a world-class field force. They expanded beyond the call center and placed reps in the field. VP Carl Schachter started the field team. They developed two pitches: one for practicality, the other for vision. Hired a field force, first in New York, then Chicago and Atlanta. Enterprise wanted:

  1. Security
  2. Scalability
  3. Reliability
  4. Performance
  5. Integration
  6. Customization

And VALUE – not just price.

The Rudnitsky Sales Playbook:

  • Think BIG, Have Attitude
  • No Deal is Won or Lost Alone
  • Connect the Dots: never dial for dollars! Never cold-call; always call with a plan.
  • Focus on “Why Not”: find 5-6 reasons why it might not work.
  • Always Take the Deal off the Table: If a deal is ready, close it.
  • Get Your Face in the Place: Walk their halls – frequently.
  • Fun Facts Build Instant Credibility: Learn about the rest of the company you don’t work with.
  • Be Proactive on All Paperwork.
  • Always Get Quid Pro Quo in Negotiations: Say no, ask for more, a close date, a press release.
  • Share Best Practices
  • Go After Game Changers

Play #47: Land and Expand

Start in a small division, then capture the rest of the company. Recommend a corporate license agreement spanning departments and multiple products.

Play #48: Abandon Strategies that No Longer Serve You

From “Try and Buy” to “Buy and Try” – moved from free trials to paid trials with no commitment but more complex solutions to better meet needs and more skin in the game.

Play #49: Old Customers Need Love

Watch login patterns to find customers who aren’t using things much and help, train, or fix things for free to maintain 90% retention (even customers who go out of business.)

Play #50: Add It On and Add It Up

Added a professional services group and sales reps made more to sell more services later.

CEO makes himself available to customers ceo (at) salesforce.com. Answers every email.

Play #51: Success Is the Number One Selling Feature

We never sold features. We sold the SaaS model and customers success. Best customers are the best salespeople.

Metrics:

  • Inbound sales
  • Raw Web traffic
  • Capture rate
  • Lead conversion rate
  • Close rate
  • Average deal size
  • % new versus addons
  • Sales cycle length
  • Sales productivity: avg amount close monthly per rep

Here are links to the rest of my notes on “Behind the Cloud” by Marc Benioff, I’ll notify of new summaries of other books I do on my Twitter/LinkedIn accounts – Ken Krogue

Part 1 – The Start-Up Playbook – How to Turn a Simple Idea into a High-Growth Company
Part 2 – The Marketing Playbook – How to Cut Through the Noise and Pitch the Bigger Picture
Part 3 – The Events Playbook – How to Use Events to Build Buzz and Drive Business
Part 4 – The Sales Playbook – How to Energize Your Customers into a Million-Member Sales Team
Part 5 – The Technology Play Book – How to Develop Products Users Love
Part 6 – The Corporate Philanthropy Playbook – Make Your Company About More Than the Bottom Line
Part 7 – The Global Playbook – How to Launch Your Product and Introduce Your Model to New Markets
Part 8 – The Finance Playbook – How to Raise Capital, Create a Return, and Never Sell Your Soul
Part 9 – The Leadership Playbook – How to Create Alignment—the Key to Organizational Success
The Final Play

Author: Ken Krogue |
Summary of Ken Krogue’s Forbes articles

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