This is Part 11/18 in the series “How to Build an Innovative New Product or Company” on the topic of creating and updating your sales pitch for B2B companies. In the prior articles, I’ve shared an approach for pitching to investors in your early days. Here we’ll discuss some ideas for pitching to potential early adopter customers.
… And the point that they’re missing is that you need many sales decks. You need one to raise funds (a pitch deck, discussed in an earlier article). You’ll need other sales decks for different audiences in a B2B selling process.
Over time, your sales deck will naturally evolve. When you’re selling to an early innovator, before your product has been fully built, it will be much more focused on the opportunity and a “imagine a world where…”-type approach. After you’ve built the product and piloted it and have had the benefit of many discussions behind you, your sales document will grow to reflect the new learning.
The best sales decks I believe are the smallest. No one likes looking at PowerPoint pages. A punchy version of your demo is one your best sales tools, especially if the product is structured around the users’ needs and buyers’ value pool.
At one point, I thought doing a good demo was all you needed. Through experience, I’ve evolved my thinking on this. You need to tell an executive audience in one slide (e.g., an executive summary), what category of thing you are, what it is you do, whom your users will be, why they will love you, and what impact you will have. You need to remind them why the problem exists, such as the challenges that their users face on a daily basis, and what the ROI of solving the challenge is. Then a demo paints the picture of how it works. The whole PowerPoint section can be done in 5-10 slides. The demo has to hit a few salient points, not cover all details and functions. And then perhaps you come back to a version of the executive summary slide that tells them again what you’ve already told them.
The Innovator’s Paradox: How can a customer say “I’ve never seen anything like this before!” and “I can’t live without it!” at the same time?
It’s a paradox. The greatest value creation opportunities are when you create something entirely new; where no market currently exists. And you know you’ve got it right when prospective customers look at your product and say, “I love it! I’ve never seen anything like this before!”
And yet, as soon as they say it, they’ve also explained why they should be in no rush to buy it from you. If they’re surviving and they’ve never used a product like yours before, how critical can it really be? Sure, it might have a large ROI, but they’ve got lots to worry about on a given day, so why do this now?
How do you bridge the gap?
You have to tell a story that the world has changed.
A sales message for a disruptive new product in the early days (e.g., pre-product build)
Do not start your sales pitches by talking about the value pool.
This is especially true if the value pool has existed for a while. You’ll lose any sense of urgency: “We’ve had that problem for a while. Why do we need to act now?” You need to create, even if artificially, a sense of urgency.
And don’t start with the problem and how unsolved it has been; that has an undertone of “what you’re doing today is wrong.” You don’t want to paint the image where you’re trying to convince a buyer that they have this huge problem and, by not solving it, they’re not doing their job. If the value pool you chose to focus on is real then you shouldn’t need to have to educate them on it.
Here’s an outline of a story that can work:
- Team: We are a team that has been working together in the space for many years.
- Situation (or need): We heard about this lasting problem and need from senior leaders over that time and none of the existing tools were working. We did a lot of research, including aggregating data from a consortium that we assembled and many hours of interviews, in the beginning to determine the root causes of the problem.
- We learned the key factors that underpinned the problem and built a framework around it.
- Getting this fixed also impacts many other larger areas of performance in your business as well.
- Complication (or why the need is unsolved so far): New changes have created an unsustainable situation – e.g. current processes, systems, or people are being stretched to their limit.
- (One thing I’ve observed in comparing our sales pitches around year 3 to where they were around year 1 is that we’ve built better diagrams that support these points. For example, consider building a diagram that shows your customers’ current systems today on one side … and on the other side, the emerging process and needs and how unstructured and unserved those new ones are.)
- Your users can’t unlock this opportunity because of certain constraints and the fact that the tools they need to overcome them are not available. For example: Have you talked with those users lately? Are they always worn thin? Balancing more complexity than ever before? Have less support and help than ever before? Don’t have the time to invest in their teams or long-term planning? Have you seen those symptoms more now than ever?
- Resolution:We have the tool you need to solve it.
- Our solution is a product that organizes and supports these new needs.
- It has these three core capabilities that buyers and users love. It is laser-focused on the value pool.
- (Another useful diagram may be one that shows the steps your product takes to go from raw data through an analytics layer to serve your users in a timely and intelligent way … or similar, as it applies to your product.)
- Then do a product demo.
- The ROI is real. Here’s proof that we will jointly have an impact on the value pool. Sure, the proof points now may be thin, but here are some supportive quotes from users and early adopter buyers. (This connects everything back to the buyer and their value pool. A case study here is best. In the early days, before you have one, leverage the thinking from the 4 parts of your strategy, as covered in the earlier articles.)
- Implementation will be great. Our customer success approach is holistic and ensures high adoption and utilization among your users. Technical implementation is easy and has these simple steps. (More on what a customer success/change management/user adoption approach might look like in future articles.)
The exact wording will have to vary according to your context. But after a message like this, you can step in and explain why only you can uniquely tackle this. There’s a popular article on Medium called “The Greatest Sales Pitch Deck I’ve Ever Seen” that follows a similar outline. To some extent, it also reflects the logic of the investor pitch: the solution will happen.
Note the Situation-Complication-Resolution (SCR) framework is in here. I’m convinced it is the core of most sales presentations. It’s actually the core of all good stories. If you’ve heard of a 3-act play (the setup, the confrontation, the resolution), it’s the same concept.
Translate the ROI from a number into exactly where savings will accrue
One of the ways to coax your prospects into identifying a budget urgently for your product is to enumerate exactly where ROI will take effect.
For example, in my current company, we have proof that our product generates a 15:1 ROI in reducing nurse turnover. While most prospects have been convinced of this, many are still unsure how that will translate into budget and funding for the project.
So we started to list out where the savings would accrue. For a $100k contract with a 15:1 ROI, you’d anticipate $1.5M in savings. From published research on the costs of turnover, we could then say $150k of that $1.5M would be realized in reduced use of training materials. Another $150k in reduced use of hotel costs for temporary replacement nurses, etc. In other words, the hard, measurable savings of any one of these categories alone will fund the project. Even better, these different categories may be controlled by different members of the C-suite thus providing funding access for many potential different buyers by simply reorganizing their own budgets.
Transitioning from an investor pitch to a sales pitch
Part of raising funds requires you to explain how you are well-versed in the value pool that you’re focusing on and why you are the right team to solve it. Therefore, there is a natural inclination to continue to prove yourself in later pitches to customers. For many companies, this continues for years later. Pitch decks talk about the number of customers they are serving already and show all the research the team has done into the problem as a way to build credibility. It’s probably not needed by that point; skip it. The best way to demonstrate credibility is to demo the solution you’ve built (if you have it) or to tell your story. Your buyers and users will immediately see if you understand the problem at hand, the context that the users operate in if you’re bringing a lot of unique ideas and value to the table. Let your work speak for you. In the rare case where someone pushes you on whether you’ve got the credibility or wants to understand how you disaggregated the drivers of the value pool, you can always answer them by pulling up the pages from an appendix.
Many versions of the pitch and demo
While you need to keep the overall message consistent across conversations and audiences, the examples and areas of detail you go into may vary.
If you’re meeting with a CIO you may want to highlight the ease of data integration and how you add new value to their existing systems. For a CFO, a stronger focus on user adoption rates and buyer value pool impact is probably more important. For a CHRO, you may want to allay their concerns that you are competing with data in the core HR systems that they are responsible for and are instead providing new inputs into, and new use cases for, those assets.
In a B2B sale, there are often multiple stakeholders and they all have different concerns, needs, and interests. Learning the persona of each and adjusting your message to them may be critical to getting enterprise deals done.
How the audience will respond
If they ask themselves, “can we build this ourselves?”, that’s at least acknowledgement of the value pool and your approach. Maybe one in ten customers will choose to build over buy; the rest will realize the ROI doesn’t make sense when your solution exists.
For a brand-new product category, attempt to push pricing conversations off until later in the process. They’ve never seen (let alone purchased) a product like yours, so how can they interpret your pricing? Engage them deeply on the value pool and the ROI first; pricing has to be a function of it, not of pre-conceived constructs they may have about other products that they’ve purchased before. For a SaaS company especially, price is the most important lever because most of your other costs are fixed and the incremental cost of serving a new customer are probably quite low. So not under-selling yourself on the revenue side will have the largest impact on your overall viability and profitability.