Best Practices in Reselling Cloud Services

FeaturingCraig Rosenberg, TOPO

Justin Gray, LeadMD

BiosJustin GrayCEO, LeadMD (www.leadmd.com)@jgraymatter

Craig RosenbergCo-founder, TOPO (www.topohq.com)@funnelholic

Agenda

• The Cloud Opportunity• Cloud versus Traditional Reselling• Best Practices in Re-selling Cloud Services• The “Gotchas” - What to watch out for• Eight Steps for Getting Started

The Cloud Computing Market is in Hyper-Growth Mode

• Seventy-seven percent of respondents expect to increase spending on SaaS (Gartner 2012 SaaS survey)

• Seventy-four percent of organizations were projected to increase cloud computing services in 2012 (ESG)

• Over the next four years the Cloud Computing market is going to double. In fact, according to IDC, the cloud computing market is going to move from $28.4B to $67.3B.

The Growth in SaaS Revenue 2011-2016

Cloud versus Traditional Reselling Models

• Recurring Revenue versus the big, upfront payday

• Open, standardized API’s

• The transition to cloud is just beginning and the opportunity is huge

The Recurring Revenue Model versus the Big, Upfront Payout

Traditional Reselling

Cloud Services

Initial Deal Size

High Lower

Recurring Revenue

None On-going

Predictable Revenue Model

No Yes

Renewal Acquisition Costs are Extremely Compelling

• Every dollar of gross margin a seller receives from a new customer costs $1 to acquire, while renewal revenue only costs 12.5 cents to acquire. (Scout Analytics)

Open, Standardized API’s = Multiple Opportunities

The transition to cloud is just beginning and the opportunity is huge

Cloud computing will increase from $23.8B to $39.4B (66%) world-wide between 2013 and 2015 (Gartner)

• Infrastructure-as-a-service (IaaS) will grow from $8.1B to $15.5B (91%)

• Platform-as-a-service (PaaS) will grow from $1.2B to $1.8B (50%)

• Software-as-a-service (SaaS) will grow from $14.5B to $22.1B (52%).

Twelve Best Practices for Reselling Cloud Services

1. Understand your target buyer persona 2. Become a trusted advisor 3. Focus heavily on customer satisfaction and post-sale relationship building 4. Target prospects who are growing 5. Work within you buyers’ constraints 6. Land and expand 7. Avoid corporate IT and sell to business units or divisions 8. Mobilize for more deals at lower deal sizes 9. Sell “best of breed” or “best of feature” 10. Use a free, relevant offer to get in the door 11. Lead with a wide-solution to quickly build your customer base12. Develop a specialty to build deeper relationships with the vendor partners

Understand the Target Buyer PersonaA buyer persona is a description of a specific person for whom your products and services are intended. It goes beyond statistics and demographics, and defines behaviors, motivations, likes/dislikes, traits, etc. Its intent is to help you reach your customers on a human level. (Jeremy Victor)

“(A buyer persona is) a short biography of the typical customer, not just a job description but a person description. The buyer persona profile gives you a chance to truly empathize with target buyers, to step out of your role as someone who wants to promote a product and see, through your buyers' eyes, the circumstances that drive their decision process.“ (Adelle Revella)

10 Buyer Persona Questions1 What do they do in their job every day? (responsibilities and activities)

2 What keeps them awake at night? (list 3-6)

3 What are their organizations biggest challenges?

4 How are they measured?

5 What do their buying processes typically look like?

6 Who else is on the buying committee?

7 Why would this persona buy your solution?

8 Why haven’t they bought your solution?

9 Where do they educate themselves?(online/offline)

10 How do they prefer to educate themselves? (eg. Webinars)

Become a Trusted Advisor to your Target Market

Pay Attention to your Customers

“In our time you need to know that if you sold it, you own it. You’re going to help that customer get that outcome. If you disappear,

then your relationship disappears with you.”Anthony Iannarino

Target Customers who are growing

“One of the benefits of selling cloud solutions is that a growing, happy customer means incremental revenue to the reseller”

Work within buyer constraints

“Smart resellers won't force their prospects to rip everything out. Instead they understand where the customer is in their cloud evolution and work within their current technology constraints. “

Land and Expand

Start with smaller, sensible deals to get in the door

Sell to Business Units before IT

CDW State of the Cloud Report 2013

Mobilize for more deals at lower deal sizes

Potential Sales Models

1. Direct Reps

2. Combination of Direct and Inside

3. Inside Sales Only

4. Hybrid (75-80% inside, 20-25% face-to-face)

The Case for Inside Sales• 75% of customer would prefer not to spend time meeting face to face in

sales situations.• 150% more efficiency in your sales force by eliminating travel time.• Re-align your team by vertical, by tier, or by type of product sold because

you are not geographically constrained.• Drive Customer Acquisition Cost (CAC) out of your business model

• Increase profitability• Average Sales Price (ASP) so you can gain entry into the marketplace

• Engage inbound leads instantly. • The data shows that if you do not contact an inbound lead before it is 30

minutes old, the likelihood of converting it to a Sales Qualified Lead (SQL) plunges to near zero. Reaching out to leads at the end of the day does not work.

http://www.salesbenchmarkindex.com/bid/88402/Your-Customers-Are-Telling-You-to-Reconsider-Inside-Sales

Offer Best of Breed or Best of FeatureLast twenty years

“Cloud computing provides the opportunity to leverage best-of-breed application offerings…You can pick the world’s best application for every need, every user, and every business case. You can

deploy exactly the number of seats you need, where and when you need them.” Bessemer Venture Partner’s Top 10 Laws of Cloud Computing

Suites

Now

Use free, relevant offers to start the conversation

Examples of free offers:• Audits• Technology Assessments• Data/Research Presentations• Vulnerability Tests

Lead with a solution that gets your foot in the door

“Prospects receive something of value and sellers get the opportunity to build trust and understand the prospect’s technology environment.”

Develop a specialty that makes you indispensable to your partners

“Once we became Google’s Lotus Notes conversion go-to partner, their sales reps were calling us into deals” – David Politis

Three “Gotchas” to Watch out For

1. Trying to take too much money upfront and scaring the customers away

2. Offering too many services and solutions

3. Choosing the wrong vendors and service providers to partner with

Eight Steps for Getting Started1. Reach out to your existing

customer base2. Develop your cloud strategy 3. Partner with vendors 4. Start selling to the companies

that are looking into moving to the cloud

5. Build case studies and references 6. Build your content 7. Market to your database of leads8. Sell and market wide

Question and Answer

Questions?

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Thank you!

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