August 16, 2016
SF Metrics Meetup: OpenTracing, and Druid
Heavybit member company Librato recently hosted the SF Metrics meetup in our San Francisco Clubhouse, where speakers Ben Sigelman from Light...
If you have any sort of enterprise sales motion in place, you’ve likely felt the impact of COVID on your sales cycle. Most enterprise organizations have pumped the brakes on growth initiatives in the last few months, as (like the rest of us) their teams navigate remote work and they adjust their priorities and budgets to the new normal.
During his talk on Pricing & Packaging During COVID, Donnie Berkholz shared how enterprise software purchasing habits have changed during COVID. Watch the video below for Donnie’s full talk on the subject, and read on for some of the key differences to look out for, and how you can adapt your enterprise pricing and sales process to ensure that deals keep closing.
While enterprises are moving slower right now, that doesn’t mean that they’ve stopped buying software altogether. Communication and collaboration technologies, mobile devices, bandwidth and network infrastructure, and infosec tooling are still top of mind — if not more important than ever. While what worked six months ago might not be as relevant now, there are still many opportunities for software organizations, especially developer and infrastructure teams, to tap into enterprise software budgets.
Here are three of the key changes to enterprise software buying habits, and how your team can adapt:
Organizations are all trying to figure out how to weather the economic storm of COVID, no matter how long that might take. As a result, budgets are stricter than they were before, and regulating cash flow has become a major priority for many companies.
Structuring deals creatively will help your enterprise customers smooth out their burn over time. Ramping up over a few months or offering monthly/quarterly payments instead of a lump sum can be helpful for your enterprise buyer, and can create more of an incentive for them to make that purchasing decision.
COVID brought essential priorities into focus. While enterprise teams might have previously had a wide range of projects simultaneously, many have whittled down that list to business-essential initiatives only. To stay relevant to their shifting needs, the way you position your product is essential. Figure out how your product fits into the needs that your audience cares about now, and make sure that messaging is part of your post-COVID sales pitch.
Donnie stressed that it’s important to remember that the enterprise buying cycle involves multiple stakeholders. “How do you help your champion or buyer create a really strong business case?” asked Donnie during the session. “Because they’re going to be fighting against every other thing the org wants to spend money on. There’s going to be nothing on that list that’s just cool to do. Every single thing that gets approved is something that creates new revenue or cuts real cost.”
In the best of times, networks matter for enterprise sales. Enterprises often prefer working with trusted partners to reduce risk. With a narrower focus and tighter budget, they’re even more likely to stick to trusted vendors with whom they already have a relationship.
It will be harder than ever to get a foot in the door with new enterprise prospects, but don’t despair. Take advantage of the relationships you’ve already built, both with prospects and with other organizations within the industry. Partnering with other vendors and resellers can be a good way to find a route to find new prospects and get a warm introduction.
Donnie also mentioned that while new enterprise deals can be harder to close during COVID, it’s more important than ever to focus on retaining the customers you already have. Do whatever it takes to keep customers, even if that means pushing spend to next year or dropping them to a lower pricing tier temporarily.
We’ve been pulling together resources from industry experts and go-to-market practitioners to learn what teams can do to better adjust their revenue strategy this year. Check out our post on COVID resources for devtools startups for a complete list of COVID recovery content.