Executive Conversation visited with Jim Steele, Chief Customer Officer at Salesforce.com, where he is charged with advancing the company's winning cloud computing strategy, customer success, and growing the customer base. We asked Jim to translate his more than 25 years of technology sales and executive management experience into insights for today’s sales professionals.
Q: What’s different about successfully selling services vs. products/hardware/equipment?
A: The mentality is dramatically different. When you’re selling a product, it’s all about the transaction, getting them to buy the product. Once they do, ownership transfers to the customer, you celebrate, it’s done. All the revenue is booked in that month.
When selling services, in our case subscriptions, it’s all about getting the adoption. It requires a different sense of being in it with the customer. As opposed to placing all the risk on the customer, there’s a constant threat that subscribers will leave. In contrast to perpetual licenses, revenue is only recognized ratably.
With cloud-based and other services, you can’t take customers for granted; you have to be there to help them be successful.
Q: Talk about the mechanics of selling subscription models and renewals.
A: When subscribers initiate a contract, it triggers three things in the relationship:
- To ensure they come back and renew the contract. If they don’t, it’s a big revenue hit. You’ve got to sell a lot more when attrition rates are high. With services, sellers have a vested interest in their customer’s success so they renew the contract.
- All future opportunities at that account are now based on the success of the initial deployment. If the customer doesn’t see value, not only will they not renew, they’re not going to add users either. Whatever the initial subscription, accounts typically are not all in on Day 1, so getting it right from Day 1 is critical.
- The ultimate goal is now for the customer to help get the message out. Our business is about word of mouth, creating a viral effect. If you don’t have customers willing to talk about how your services have transformed their business, all the rest are hollow words. You could be best salesperson in the world, but if you don’t have customers who will be your reference, everything else is just an unsubstantiated promise.
Q: What do you expect from sales professionals after a sale has been made?
A: With all of the choices people have today, you have to be somebody that customers know they can count on. This is especially true after the sale because that’s when they’re going to need you the most.
Our sales people earn a commission on the initial sale, but the follow-on business is a very important part of our model. Our team knows that they can earn a lot more as customers add users, achieve successes like reaching certain adoption rates, and renew.
We take the long view, and work with customers to make sure they get value. If they don’t, they won’t last long as a customer.
Q: How does your team work with accounts post-implementation to measure results?
A: We have a post-sales organization called Customers for Life that involves consulting, implementation services and customer success management. Their role is to work with the sales team to show the real results customers are achieving.
They track customer success with a scorecard that shows customers on a quarterly basis how they’re doing against industry adoption and use rates benchmarks. For example, you’re way ahead in terms of using dashboards, or behind in terms of adoption. We may also highlight functionality that the customer is paying for, but not using.
We then go in and talk to them about where they’re getting value. We don’t want to rely on some subjective view of how Salesforce is doing. We work with customers to track a whole set of metrics, such as how they’re reducing time to value, driving revenue, cutting costs, or improving their ability to cross-sell and up-sell.
We want to make sure we have real business results that we’re tracking together so that we can claim victory together, not independently.
Q: When a sales proposal interests you, what do you look for when meeting with vendors?
A: When sellers call on me, I want to know that they’re listening, that they have a point of view, and to hear some recommendations and ideas in the context of my business. If they don’t relate it to me, they’ve lost credibility and set their sales cycle back.
I’ll share the process I go through when calling on customers myself; I call it Listen, Validate and Inspire.
By listen, I mean actively listening to what’s going in their business, their top priorities, and key initiatives. Of course, I’m going to have looked at as much information as I can get my hands on to know what those answers are likely to be.
If you want to engage with a customer, what better way than to show them you’re interested in their business? Listening leads customers to open up because they all want to talk about their business, that’s what they’re passionate about.
As they share their challenges and initiatives, I validate back in my own words what I understood. This tells them I’m listening, not just trying to sell them something. This also helps me, because if I hear important initiatives that I can’t relate back to what I’m selling, I might as well not be there.
Once I’ve heard and validated their issues and challenges, I want to inspire. For example, ‘my team has been working with you and they’ve come up with some great ideas I’d like to share’. I like to show how other customers they can relate to have used our technology to solve their challenges. I’ve also found that showing how we use our own technology is valuable.
Q: What advice do you have for sellers trying to secure time with customer executives?
A: Two things: 1. Connect the dots. 2. Do your research.
On the first, calling on somebody who has no idea who you are, and trying to impose yourself and your solutions on them, is never a fun way to start a conversation.
Messages that begin ‘Dear Mr. Steele…’ are non-starters. Work to find a connection, from the past, a colleague, a customer. For example, if I received a note from a customer ‘I think you should meet with so and so, we’re using them at our company’ I’ll read it because that relationship is important to me. If it looks like it could be relevant for Salesforce, but not in my area, I’d connect them with the appropriate executive at Salesforce for consideration.
Secondly, people who have done enough research to know what your company does, who you are, who your partners and customers are, stand out. Start customer conversations in the context of ‘this is what I know about your business, and this is why we can be of value’.
Q: What type of seller research resonates with you?
A: Research specifically about Salesforce. If it’s just generic data that doesn’t involve Salesforce, it’s not relevant. Just picking stuff off the internet isn’t credible. Real research means you’ve talked to people, like customers, and you know what’s going on in the industry.