In the past couple of months I have met with four entrepreneurs, all highly passionate about their products and excited with the potential for them in the market.
I had dinner with a Sales VP of an early stage technology company this week and discussed her business and her experience in building the startup revenue stream. We got down to talking about "the how" of building the sales team, recruiting the channel and generating revenue.
They now have 6 people in sales globally and their resellers are starting to sell their product, although she mentions it was a painful process in getting there.
Early adopters of new technology are prepared to accept more risk when buying technology than the majority of buyers.
If you subscribe to current research, buyers are contacting vendors at somewhere between 60-70% of the way through their buying process. What this research fails to mention is this only applies to mainstream technology that is in established markets and where there is an identified and known set of competitors.
Buyers enter the buying process depending on technology maturity and buyer risk tolerance. I like to use the IMPACT mnemonic to describe buying cycles because I think it more accurately reflects what is actually going on in the buying organization
IMPACT The six phases of the buying process are easy to remember as they will have an enormous IMPACT on your company’s performance:
There are the Early Adopters (EA) who are happy buying innovative solutions. There are the Early Majority (EM) who want to buy the market leader. And there are the Late Majority (LM) who want to buy a commodity at the cheapest price. Here is where the buyer starts to engage in terms of the IMPACT process.
Early adopters will enter the buying process at 10-20% of the way through a buying process and laggards will wait till they are 90% of the way - and all they care about is price or the service discount.
Successful entrepreneurs, marketers and salespeople selling disruptive technology must learn to recognize early adopters, understand how early adopters engage with innovative technology vendors and how they manage a buying process.
This is the subject of a new eBook from authors of “Why Killer Products Don’t Sell”, Ian Gotts and Dominic Rowsell, and Adrian King, entitled “IMPACT - the technology executive’s guide for selling B2B disruptive and innovative solutions”.
CSO Insights have been publishing sales performance data for technology companies for the past 16 years.
This year is the first time they have broken that data set down to include a survey of Start-up sales and marketing performance. In their 2010 Sales Performance Optimization Survey, a total of 182 startup sales leaders completed the comprehensive survey of all aspects of the sales and business development process.
As a consultancy we focus on solving marketing and sales problems in both start-ups and in established companies. Established firms trying to sell innovative technology to early adopters, have similar problems to startups, except for the cash-flow constraints.
This survey of 182 start-ups of which 60% were based in the USA highlights a number of issues of which we have first-hand experience. We believe the following data are interesting and worthy of discussion.
