Dear SaaStr: What factors that make it difficult for a salesperson to sell a new product to a customer who has been buying a competing product for many years?
There are so many products I would buy if the vendor just said "I'll do all the work for you"
Instead, they all just want to tell me why they are 10x better
But not really help me:
– buy out my contract
– migrate my data
– onboard my team
— Jason ✨Be Kind✨ Lemkin (@jasonlk) July 13, 2023
I see so many reps trying to steal a customer that focus on:
- Price (we can save you 10% vs the competition!! so what)
- Wanting to get “on a call” to talk (i don’t have time to help you sell to me)
- Why their product is so great (why do I care?)
None of this matters, most of the time, in SaaS. Not really. Because the switching costs are so, so high to rip one app out and replace it with another. To find the time to deploy a new app. To train the team. To figure out the corner cases that won’t work as well. To learn slightly different, new ways to do the same thing.
So a discount isn’t remotely enough. The switching costs will far exceed the costs for the software itself, in many cases.
What sales reps should be selling if they want to steal a customer from the competition is:
- “We’ll do all the hard work for you to replace their app with ours. We’ll install it, tweak it, and even let you do a totally risk-free pilot for 90 days if that helps.”
- “Is there 1 critical thing you are missing from your existing vendor? What is it? Let me know so we’ll see if we can solve that big problem for you.”
- “Here is the 1 reason we are 10x better. Does this solve your problem? If so, again, we’ll do all the work.”
- “We’ll buy out the term, if any, with the other vendor so the direct switching costs are zero.”
- “If you want, you can use both apps at the same time and test them side-by-side. And we’ll do 99% of the work for you.”
Imagine you heard that …
Then, when there’s a real bump with an existing vendor … you just might switch.
But so few companies and sales orgs go this far. So very few. It’s more work, no doubt, than just closing a warm inbound lead.
As you get bigger, you may need a SWAT team that just does … this. A sales team, with higher commissions and specialized skills, just focused on Stealing Deals / Stealing Deals Back. At a minimum, the best marketing teams do. They track Lost to Competition Leads as ones they get a new shot every 12-24-36 months down the road.
A bit more here: How to Steal a Customer From the Competition | SaaStr
It is a lot of work to switch vendors. A total pain.
So be very embarrassed when you lose an existing customer to the competition
And do something about it before it happens again
— Jason ✨Be Kind✨ Lemkin (@jasonlk) October 13, 2020
(note: a classic SaaStr post updated)