How To Sell Software: The Ultimate Guide
Selling a physical product to customers can feel like running a marathon.
But selling something intangible… like software? In an online marketplace? That’s like one of those Iron Man events that crazy people do. If you don’t put in the hours training and preparing, you’ll wind up crawling towards the finish line, wondering where it all went wrong.
Look, we’re not saying you don’t know how to sell software, that would be facetious, but we want to show you that we know what we’re talking about when it comes to software marketing –and you might be missing out on some golden strategies.
Without an evolving understanding of how to sell software in an ever-changing environment, you start to lose track of the most important questions:
Who are your customers? How do you explain your service offerings? What type of content should you be producing? Will you be able to stay up-to-date with your competitors? Should you change your pricing or website or everything? Can you do it all without breaking the sales or marketing budget?
And most importantly: where do you start?
The best athletes would be nowhere without discipline.
As long as you’re willing to put in the work, you’ll untangle the mysteries of how to sell software services faster than you’d expect.
How to Sell Enterprise Software: A Game Plan
Taking the first step is essential. All the same, launching headfirst into hard selling with no strategy will get you precisely nowhere.
You need a sales strategy. Thankfully, no matter how complex your solution, there are 5 simple steps for how to sell your software online.
- Create a customer persona
- Study current performance
- Know your customer’s journey
- Set clear goals
- Update your strategy
Step 1: Create a Customer Persona
Selling with no idea who you’re selling to is like painting blindfolded. You’ll probably get some paint where you want it on the canvas, but it’s far more likely you’ll end up wasting most of your paint.
Define your target audience to find out how you should be focusing your sales approach. A few common items to focus on include:
- Social Media Usage
- Relationship Status
Don’t go too overboard coming up with buyer personas. Creating a few clear, well-defined personas beats having a dozen vague impressions.
Your marketing and sales team should share a unified vision for customer profiles. Create them together and you’ll have a great start to your new sales strategy for everyone on your team to follow.
Asking your sales team about the conversations they have with prospects is also a great way to build your customer personas. You can focus on the most common objections faced by your sales team, and work out an effective strategy to navigate those objections through your marketing.
Step 2: Study Current Performance
Analyzing your company’s performance right now is key to understanding how to sell software to a business.
To build a future-proof marketing plan, you need to understand what’s working and what’s not.
Ask yourself questions like:
- Why are we retaining/losing customers?
- What’s the bounce rate on our website?
- Where do our leads come from (e.g. website, apps, search traffic)?
- How long are customers staying with you?
- Where are you expending resources? How does that translate into results?
Identifying inefficiencies in your company is the name of the game here. If you’re putting a lot of time and money toward SaaS marketing and lead generation through social media and seeing low returns, it might be time to look into reallocating those resources.
Look for underlying patterns in your performance metrics. And don’t be afraid to ask customers for their feedback. That’s where you’ll find answers on how you can improve.
Step 3: Know Your Customer’s Journey
Understanding the customer’s journey and being intentional about what content is positioned at each stage is crucial to get results.
There are a few different ways you can conceptualize a customer’s journey. Perhaps it’s from lead to subscriber to customer, or by stage: awareness, interest, desire, and action.
Mapping out the customer journey, then positioning intentional pieces of content to match each stage in the marketing funnel, is the most effective way to use inbound marketing.
If you’re selling a communications software solution to professionals, here’s how you might map content onto the customer journey:
Outbound PPC ads, landing page to encourage prospects to self-identify with the pain point you solve
Email newsletter filled with trends on the latest in office communication technology
Webinars and case studies about the success of your communications software in the workplace
Offers for a free trial on their website
Give people what they want to see at each stage and they’re far more likely to follow your lead down the marketing funnel.
Another thing to keep in mind: knowing how to sell software as a service is trickier than more traditional products.
Even if the overall stages break down similarly, each section of the sales cycle might vary in length.
With complex software, you’ll have to spend more time educating customers about how your service meets their needs before they are ready to commit. If you’re targeting corporate decision-makers, they’ll likely need more time to consider before purchasing a subscription.
Of course, not every SaaS will have the same sales cycle. Whatever your customer’s journey is, you should understand it thoroughly before building up your sales strategy.
Step 4: Set Clear Goals
Maybe you want to increase website traffic or conversions. Maybe you just want people to click the one big red ‘buy now’ button on your site. Either way, you need clear goals for an airtight sales strategy.
When you set goals, you also need to be tracking your progress. Find out what metrics are most relevant to your success. Is it customer churn? Net promoter scores? Annual Recurring Revenue? (More on specific metrics later.)
Find out what’s normal for your industry and what’s normal for you. For example, small and medium SaaS companies should ideally have a churn rate of under 10%.
You aren’t going to succeed without knowing what success means to you, so define and track your goals before aiming to exceed them.
Step 5: Update Your Strategy
You’ve settled on a golden strategy. Everything looks perfect. Now you’re prepared to cling to this thing like a piece of driftwood from the Titanic.
There’s only one problem. It’s time.
Everything changes. Your company will shrink or expand. Your marketing or sales teams evolve. New software marketing technology joins the fray every few years to keep things exciting.
You don’t need to update your sales strategy every week or even every month. Just know that you will have to stay nimble if you want to stay successful.
Set a reminder for yourself and review your master plan every six months or so. Think about what’s new, what’s working, and what you want to do differently.
It’s a jungle out there. Get sluggish and you’ll find yourself falling behind.
If you’ve followed the above steps, you should have a pretty solid sales strategy at this point. Now it’s time to review a few smart tips on how to sell a software product online.
6 Top Strategies and Tactics on How to Sell Software As a Service
So you have a sales strategy, more or less. What next?
Now it’s time to pick through more wisdom on how you should be selling your software. Here are six SaaS sales secrets you need to know.
- Understand Inbound vs. Outbound
- Educate Before Selling
- Experiment with Pricing
- Keep Trials Short
- Follow Up
- Take Care of Current Customers
Understand Inbound vs. Outbound
You’ve probably heard a good deal of smack talk about outbound marketing. These days it’s known as the more impatient, less refined cousin of inbound marketing.
To some degree, this is true. Outbound marketing is about finding customers no matter where they are and pushing your product out to them.
Back in the olden days, this might have been billboards, radio or TV advertisements, newspaper spreads. Nowadays outbound marketing looks more like pop-ups, sponsored search results, and website banner ads.
Sometimes it’s not a bad strategy. Searching for “best jackets” probably means you’re in the market for a new jacket, so when you see popup suggestions you’re actually likely to click on them. Jackets are simple, consumer products that need no explanation, so pushing ads to customers with the intent to buy makes a whole lot of sense here.
But in how to sell software online, outbound marketing is at a disadvantage. You need to establish trust with customers before pitching to them.
Inbound marketing is all about trust. You aren’t flashing a million popups at your customers every day in hopes they’ll finally cave in and check you out.
Instead, you’re targeting customers based on what awareness stage they’re in, offering them content that they’ll find value in.
Are you a healthcare platform targeting hospitals? You’ll find more success in producing well-researched content on medical data than buying out Google search results to advertise your platform. The former approach positions you as an expert on healthcare technology. The latter, that you have a lot of money to drop on PPC searches.
Figuring out how to sell software to hospitals is the same as figuring out how to sell software online to any business. Give them insight and they will follow you.
When done right, inbound content provides great value for customers and companies alike. A single quality investment in an evergreen piece of content is enough to draw traffic over months and even years. It’s a short-term expense for long-term results.
Most importantly, inbound marketing delivers qualified leads. Aggressive social media ads might draw some clicks, but at the end of the day you’ll wind up with a lot of unqualified leads scratching their heads and wondering how they got here.
Don’t settle for unqualified leads. Deliver the right kind of content to the right kind of customers. You’ll be saving everyone’s time and earning revenue for your company.
Educate Before Selling
You’re not selling jackets.
Everyone knows what a jacket is. How you wear one, why you need them, what they look like. The only thing customers need help with is what their options are.
Software is different. You’ll need to justify your product’s existence, explain how you integrate into the ecosystem of technologies customers already have on-hand. The difficulty of your product is one of the greatest SaaS marketing challenges.
Without context for your product, you won’t make sales. So don’t start with sales. Start educating customers first.
Ask yourself the questions your customers will ask when they come across your product:
- What do I need? What does my business need?
- What are my options?
- How can I learn more about this area?
- What should my criteria be? Should I care about X, Y, Z…?
Chances are, people won’t be ready to start asking directly about your product. They have a problem, and they’ll come to you if your content gives them the right solutions.
For example, they need a place to communicate with their DevOps team without losing momentum. But right now they’re just worried about figuring out the basics of how you can simplify their workflow and stay productive with a DevOps team specifically. Maybe they’ll find you through a guide on the subject, and you build a relationship from there.
Your content provides solutions. And if you’re doing things right, you should be building up your product as the all-in-one solution for their problems: where they can manage sales deals without hassle and with full customization options.
People will come to you for answers. So give them answers. You’re the expert here, after all.
Finally, when leads do convert to customers, make sure you’re simplifying the onboarding process as much as possible. You want customers to understand your value before diving into your platform. When their first experience with your platform is a good one, they’re far more likely to become a returning customer.
Experiment with Pricing
How to sell a new software product online is one issue. Finding the sweet spot for pricing your product is an unexpected way to boost your sales.
Fair disclaimer: you should play with pricing every few months.
Experimenting with different pricing models will help you gain insight into what’s working for your business. You’re far more likely to find the right way to price if you try new things than if you stick on the same model for years.
Here are six tips for testing out different types of pricing.
- Offer multiple pricing brackets: Different pricing options appeal to different consumers. Some customers will pick the most expensive prices each time, while others will budget for cheaper options.
- Deliver more services for each price bracket: Just ramping up basic functionality isn’t always enough to show people your value. Giving them more tools makes them feel like they’re getting what they pay for.
- Cheap doesn’t always work: Premium products sometimes demand premium pricing. Your customers might not trust a low-priced product for quality.
- Streamline pricing listing: Design matters, and it’s often in the details. Easy-to-read prices and clean design leads to more sales. Customers want something they can understand at a glance.
- Consider acquisition cost: How much does it cost to bring in a customer? You need to set a price that helps your business survive.
- Offer a discount: Even slight discounts can make customers think they’re getting a better deal, convincing them to subscribe or stay onboard while they might not have otherwise.
Annual and monthly pricing plans are two of the main options. Here are some pros and cons to consider about each.
Annual Pricing Plans
Monthly Pricing Plans
Of course, you can always offer both to give customers the freedom to make a decision that suits them. Sometimes, letting people choose between two options persuades them to just jump ahead and make a purchase.
Discounts are another consideration here. If the pricing on your yearly seems prohibitive to customers at first glance, try offering a discount to persuade them to switch over.
Keep Your Trials Short
Short and sweet. Sometimes that’s the best way to keep customers hooked and wanting for more.
Why do shorter trials work better for SaaS companies?
- Higher engagement: Most customers don’t try the product out for the full trial period. Shortening their trial encourages them to actually try out all the functionalities.
- Shorter sales cycle: Spending less time closing out a sale means more time on actually selling. Shorter trials mean less time tracking each trial customer, and reduced customer acquisition costs.
- Find qualified leads: Some people will never buy from you. Shorter trials are likelier to attract customers actually interested in your product.
Of course, a free trial can be the tipping point from leads into dedicated customers. There’s no hard and fast rule here.
Ideally, you want to give your customers plenty of choices between free trial and optimized pricing.
Communication and team management platform Monday gives people pricing plans galore, plus a free trial option that only asks for your email.
Just like that, the customer is hooked: if they genuinely start managing projects through Monday, they most likely won’t want to switch away after they’ve invested time to learn the platform. Chances are, they’ll be willing to fork over the $8 per user to upgrade their plan.
In the SaaS industry, a 14-day free trial works well for most companies with medium complexity. But again, even this isn’t absolute. Just like pricing strategies, play with your options, and see which strategy is the best for your company.
Yep, that’s really all there is to it.
You’re probably not following up enough with your customers. Perhaps you’re a little freaked out that people don’t want to hear from you too much, or that your emails are going straight into their spam inboxes.
While there’s certainly a balance between ignoring and annoying customers, you want to stay in touch with customers midway through their buyer journey.
Have they just finished a free trial? Have they watched a demo but said they needed to discuss it with their team? Did they ghost you a month ago after an exploratory discussion?
Your sales reps should be following up, reaching out. They should be doing this manually, addressing people directly, and taking notes on each lead’s status. Personalized messaging can be enough to tip people into committing to your service.
Marketing emails count as follow-up too. You should have a powerful call to action, valuable webinars and blog posts, educational content on how to use the platform in question.
Wix follows up on their subscribers with highly informative webinars on how to get value out of their platform. The more you explain the value within your product through an email drip campaign, the more likely you are going to convince customers to revisit abandoned accounts, maybe update an old subscription.
Even when people are ghosting your sales reps, they can’t just leave off without a farewell. Breakup emails receive 5x the response rate that regular sales emails do.
You want to give people the chance to reconnect, while also acknowledging that your relationship might be at an end. Just like a real breakup, this should ideally be graceful. Unlike a real breakup, you should never guilt-trip, plead, or cry.
Showing that you’re willing to leave off actually increases the desirability of your product, which might compel a customer to write back. Worst case scenario you hear nothing back, and then you know not to spend more time and energy on an unengaged lead.
Take Care of Current Customers
Sales aren’t all about introducing new leads into your ecosystem. It’s also about maintaining a favorable retention rate. And great customer service is how you keep clients coming back for more.
Taking great care of your current customers is a surefire way to generate more revenue. Here are a few strategies to try:
- Referral bonuses: Incentivize people to say nice things about you. Referral bonuses make everyone feel good and generate revenue for you.
- Upselling when appropriate: Does your customer keep hitting their account limit? Suggest an upgrade to a better plan. Maybe even throw in a limited time discount for them.
- Checking in: Customers like a personal touch. Have your customer support check back in with them if they seem like they need more help. Survey users to find out what they like or don’t like about your service.
- Educational resources: Not every customer will understand how to make the best use of your platform from the get-go. Following up with educational resources guarantees they’re getting the most use out of your product and that they’ll recommend it.
Customer care is about keeping clients happy. And a happy customer is one less customer you’ll have to worry about replacing. Justify your customer acquisition costs by retaining clients over a longer time period, and you’ll get more revenue with less effort.
And that’s how it’s done. Take this advice and you’ll be selling better without breaking the bank open on flashy marketing tactics. At the end of the day, it’s all about solid basics in your SaaS marketing strategy: delivering value to customers with each interaction.
Tools for SaaS Sales: How to Sell Software, Made Simple(r)
Yes, sticking to the basics is best for selling software. But if your team is looking for ways to improve your sales pipeline, utilizing marketing or sales tools can help.
Sales Tool Case Study: LinkedIn Sales Navigator
LinkedIn is the most popular networking platform in the world, so it’s no wonder there are awesome sales opportunities to be had on the website. Now, the sales navigator offers savvy sales reps to take advantage of the site’s resources.
The LinkedIn Sales Navigator offers:
- Advanced lead search
- Customized lead recommendations
- CRM integration
- Notes and tagging
- InMail messages
While it offers organization, the main focus of the LinkedIn navigator is outreach. You can search, reach out, and follow up with leads easily through the site.
For anyone in sales looking for the broadest reach on a professional platform, LinkedIn sales navigator is a fantastic tool.
Marketing Tool Case Study: Mailchimp
Most marketing professionals are probably at least somewhat familiar with Mailchimp, the all-in-one marketing platform best known for its email functionality. It’s a nifty tool for the marketer who’s trying to get organized and do everything better.
Mailchimp offers a wide variety of tools, such as:
- Marketing CRM
- Email campaign management
- Content studio to design marketing materials
- Automated customer journey campaigns, A/B testing, surveys
- Insights and analytics
In terms of all-in-one marketing, Mailchimp does a lot of things and does most of them well. It’s certainly not the only marketing CRM out there, but it definitely wins points for being affordable and multifunctional.
The Most Important Metrics for SaaS Companies
Yes, tracking performance matters when you’re trying to figure out how to sell software online. But what kind of metrics should you be reviewing when you’re trying to figure out how well your company is doing?
Here are a few need-to-know basics:
- Churn Rate: Percentage of customers lost per year
- Net Promoter Score: Measures customer experience via a scoring system
- 0-6 points: Detractor/Dissatisfied
- 7-8 points: Passive/Satisfied
- 9-10 points: Promoter/Loyalist
- Customer Acquisition Cost: How much does it cost you to acquire a new customer?
You might notice that the most important metrics concer how customers are acquired or retained. That’s because keeping customers happy is the best sales strategy.
You don’t want to have to keep going out there to pitch to new clients, only to lose your reputation anyway. At the end of the day, you need to attend to how your current customers are feeling about your product.
What can you do better? How can you do better? These are two questions that will make or break your business.
At the end of the day, it’s still about value. Making your customers understand how your value squares up to your competitors are how you’ll win them over, and you can’t do that without delivering great value to them via content.