In Part 1 we noted that, just like buyers, you need help. Then, in Part 2, we made it clear that in order for you to understand you need help, you need to understand where you might need that help, and that’s why we are doing this series for your benefit and going deep.
So, just like we wrote on the Five Best Practices for Buyers, which built off of our articles on five easy mistakes source to pay tech buyers can avoid and even a critical sixth mistake most tech buyers make in source to pay (who need to realize that No Tech Should Be Forever), we are giving you the ten best practices that address the ten most common challenges we see that you should be aware of, and some advice on how to address them.
In our first two articles we gave you the first seven:
- Identify the Market Sector You Are Competing In
… and the Niche Your Solution is Targeting
- Do Your Market Research
- Define Your Target Industries
- Identify the Core Pain Points Your Solution Will Address in the First Release
- Understand the Data Needs and Design the Full Data Model
- Understand the Current Customer Processes and Typical Restrictions
- Don’t Overlook the UX (User Experience)
which revolved around market research and technology. Today we give you the next three, which revolve around the marketing (and sales) of the product.
#8 Get the Messaging Right
Not cool messaging, not current hotness messaging, not buzzword messaging, but meaningful messaging that gets the right points across. What it does, how it addresses the customer problems, how it improves the customer situation, and how it will deliver a return on investment in the short and long term.
This is easier said than done, because the messaging still has to be attractive, easy to consume, comprehensible by your target audience, and to the point. It’s a tough balance, made harder by the fact that if you don’t understand the industry, the terminology, the current technology, the competition, or what the audience is looking for, you’ll never get it right.
#9 Price It Right
This is very hard. Price on ROI? That’s different by company. Price by competition? If it’s truly different, it’s not comparable one-to-one. Price by current market size average SaaS spending? That could price you out of the market or price you out of business. It’s the optimal balance between value, customer budget, and all-in costs to the company (development, implementation, support, etc.), and that’s not easy, but it has to be understood to ensure the majority of the intended market can afford it and do so by the next budget cycle, that the pricing doesn’t sell the solution short, and most importantly, that the sale price doesn’t put the company in financial jeopardy.
#10 Get Advice AND Listen to It
Analysts and Industry Experts are your friends, at least if you listen to them and ask good questions and listen when they are able to give you advice (and listen even closer when they say they are not the expert in that area and redirect you to the those who can, as the best analysts and experts not only know their areas of strength, but their areas of weakness and will send you to the right analyst or expert when you have a challenge outside of their core areas).
There are a number of things you need to understand, especially if you are a new founder or CEO:
i) They are much more informed than you on the market, assuming you are talking to a senior analyst or long-time industry expert. Maybe you’ve seen a few solutions and heard customer opinions on a few more, and hearsay customer opinions on a few more than that, but most analysts have seen dozens of solutions in any particular area and have deep understanding of what those solutions do, what the target markets are looking for, and the average technical proficiency of those markets. You don’t have that. (And if you think you have a great solution because Ariba and Coupa doesn’t do something, you are drastically underprepared to tackle the market on your own.)
ii) They have seen the majority of the messaging and sales approaches and have seen what works and what doesn’t. Your CMO might have been the Marketing Guru in their last job, but if that last job was in a different area of tech, or even a different area of Source-to-Pay/Supply Chain, their knowledge and experience doesn’t necessarily translate. Going back to our point about market maturity, and risk-aversion, an experienced industry analyst has a lot more insight into what’s worked and what hasn’t and is the person your CMO needs to learn this new industry/market and how to use their skills to be the next Guru in your market.
iii) They are aware of the market research and expertise that exists that you can take advantage of. You don’t need to guess, and you definitely don’t need to double down on your start-up assumptions and proclaim them as inescapable truths, which, as experts know, likely only holds true in a vacuum (and could be completely false for the majority of your target market).
Plus, as we indicated above, the best analysts know their areas of strengths and their areas of (relative) weaknesses and when they can advise you well and when to pass you off to a colleague, even if at another firm. (If the doctor doesn’t know, or isn’t in the best position to advise you, he’ll happily pass you off to one of the dozens of active analysts and industry experts he trusts to advise you appropriately, which includes the analysts he publicly listed in his analyst recommendation post.)
Is this everything you need to do? Or even know? No, but it’s a great start and when you get these practices down, you will be in far better shape than your competition and not make the same mistakes us long time analysts and consultants see over, and over, and over again. We see far too many companies take two steps back for every step forward during their formative years, and it just doesn’t need to be that way. Especially if they are bringing a better solution to (a subset of) the market.