Successful Sales Strategies for startups

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Successful sales strategies
for Startups
Amit Padalkar
Santa Clara, CA
myLocalGood LLC Confidential.
All rights reserved

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A few motivational quotes to
start…
“It is not the critic who counts; not the man who points out how the strong man stumbles,or
where the doer of deeds could have done them better.The credit belongs to the man who
is actually in the arena, whose face is marred by dust and sweat and blood; who strives
valiantly; who errs, who comes short again and again, because there is no effort without
error and shortcoming;but who does actually strive to do the deeds; who knows great
enthusiasms,the great devotions; who spends himself in a worthy cause;who at the best
knows in the end the triumph of high achievement, and who at the worst, if he fails, at least
fails while daring greatly, so that his place shall never be with those cold and timid souls
who neither know victory nor defeat.” - Teddy Roosevelt
“To achieve, you need thought.You have to know what you are doing at that‟s real power.” –
Ayn Rand
“I gave him an unlimited budget and he exceeded it” - Edward Bennett Williams
myLocalGood LLC Confidential. All rights reserved
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Why startups should care about
Sales?
 Founders (& Co-founders) build something of value
 Bootstrapped initial investment is meant to last until “Sales
arrives”
 They then hire sales & marketing people who sell nothing for
a year(or more!)
 Vicious cycle of trying to get more investment without any
clients (or bad clients)
Hiring Excellent sales people early is the life-blood of any
startup to build Traction
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How sales happen
 Targeted Marketing
 Gradual refinement of Marketing experiments
 Disciplined Sales process that turns leads into revenue
Sales is not a pitch,it’s a search
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Marketing 101:What’s targeted
marketing anyway?
 Define the “Market”
 People or organizations with needs and the willingness and ability
to buy
 Any group that lacks any one of the above characteristics isn’t a
market
 Targeted marketing focuses on generating demand aka,“leads”
from such a group or a market
 Needs: state of felt deprivation including physical, social, and
individual needs. For e.g., security, fitness, emotional
 Outstanding entrepreneurs should clearly understand both
their customers needs and the value they are providing through
their products and services.
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+Marketing 101: Sources &
Manifestations of value
Sources:
 Economic:
 The economic benefit a customer
derives from using a product
 Functional:
 Those aspects of a product that
provide functional or utilitarian
benefits to customers
 Psychological:
 The image of the product, including
how the product “feels” and whether
that feeling matches the image the
customer wants to project
Some Manifestations of value:
 Price
 Price sensitivity
 Satisfaction
 Complaints and compliments
 Word-of-mouth
 Margin/Profit contribution
 Dollar sales
 Repeat purchase rate
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+Marketing 101: Defining the Value Proposition
 The bundle of benefits the product provides to fulfill customer needs and
wants. Everything the customer experiences when acquiring and using a
product.
 A value proposition is a clear statement that
- explains how your product solves customers’ problems
- delivers specific benefits (quantified value)
- Informs the target customer why they should buy from you and not from
the competition (unique differentiation).

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Startup Marketing Experiments
 Networking
 Associations and Tradeshows
 Assigned Meeting events: Eg, banking
and brokerage events for financial
services product
 Paying for arranged meetings
 Cold calling
 Influencers
 Channels
 Media – Real world, online, mobile
 Webinars – Free and paid
 Analysts
 Advertising (SEO, Pay per click, etc)
 Your website: Don’t make me think!
 Blogs and Micro blogs
 Social Media
 Viral Marketing
 Unsolicited emails(NOT Cold
Calling!)
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Qualifying leads:The only unforgivable
sin in Sales is wasting time!
 3 Basic questions
 Why buy anything? (why not just do nothing?) (is the pain real – does it meet
the definition of your market?)
 Why buy from us? (why not from competition?)(where is your value?)
 Why buy now? (why not wait?)(What other event is compelling them to buy
now)
 Don’t waste your time beating dead horses
 Super critical in startups to build credibility with investors, management
& interested parties to close deals that you forecasted
 If a lead(or deal stalls) something in the above 3 questions has changed
 Find the answers and control the momentum of the deal!
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+Typical Sales cycle & how to
accurately forecast
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Stage Probability
Suspect Zero 0
Lead (we got them to pay attention to us) 10%
Value Proposition (the three SALES qualifying questions) 20%
Champion (we have recruited an internal coach) 30%
Executive sponsorship (management sees the value) 40%
Proof of Concept (we have a trial plan in place) 50%
Formal Pricing(we’ve given them a formal quote) 60%
Negotiations (we‟re discussing price and terms) 70%
Agreement (we‟ve come to agreement on price and
terms)
80%
Signed Agreement and an official Purchase Order 90%
Customer (a happy customer who has paid their invoice) 100%
Amount X Stage Probability = Revenue; Skipping steps is not allowed!

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Maintaining a healthy pipeline
 Of all “Qualified”leads(past stage 3),
 1/3 will close per forecast date
 1/3 will be delayed
 1/3 will never actually buy!
 This implies for every opportunity that will close as per
forecast, you need 3 QUALIFIED OPPORTUNITIES!
 For every qualified lead, you need atleast 10 suspects
 This is a 1 in 30 ratio
 Hence, Define your Target Market Clearly(Marketing 101)!
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Tying it all together:What to learn
from your first sale
 What problem do you solve? Who has that problem?
 What market segment do you appeal to?
 Is this a consumer or B2B (business to business)
sale?
 If it‟s B2B, what kind of companies will buy?
 Who (what title) at those companies are the buyers?
 Which experiments did you try?
 Which experiments worked and which did not?
 What was the ratio of unqualified to qualified leads
for each experiment?
 What was the length of the sales cycle?
 How did you find those first customers?
 Were you able to sell over the phone or did you
have to travel?
 How do you compensate the sales team?
 How will you minimize internal channel conflict?
 How will you minimize external channel conflict?
 Why did they buy? Were these the reasons you
predicted?
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More Questions to ponder…
 How are they using it? Are they happy?
 How much support do they need to be
happy?
 How much are they willing to pay?
 How much did you charge?What
pricing model did you use?
 Did you sell the product as a purchased
license or as a service?
 Did you charge for unlimited usage or
by-the-drink?
 Did you make money on these sales?
 Can you make a profit on future sales?
 Is this a viable business model?
 Is there a different business model you
should adopt?
 Should you sell directly or through
channels (or both)?
 If channels,who would be the best
distributors?
 How will you market to or recruit these
distributors?
 How will you manage your relationship
with them?
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Great resources for learning
more…
 Crossing the Chasm – Geoffrey Moore
 Inside The Tornado – Geoffrey Moore
 The new rules of Marketing and PR – David Meerman Scott
 Twitter Power – How to dominate your market One Tweet at a
Time – Joel Comm & Ken Burge
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Successful Sales Strategies for startups

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