In SaaS, it’s virtually impossible to sell someone a lemon, because SaaS customers typically get to try before they buy, and they can walk at any time simply by canceling their subscription. In contrast, traditional enterprise software vendors are notorious for obscure product capabilities and pricing, because up-front purchase creates a short term financial incentive to avoid disclosing any more information than the minimum necessary to close the deal. The enterprise customer thus enters a long and intricate dance with the enterprise sales rep in order to develop the trust required to overcome the risk of signing that fat license check. When combined with the uncertainty of buying a business critical application over the Web, most SaaS startups quickly find themselves between a rock and a hard place by the need to engender an even higher level of trust than their enterprise competitor, while simultaneously having nowhere to hide their shortcomings.
A SaaS marketing strategy of complete and total business transparency
removes constraints to unleash the volume and deal size of online transactions.
Ask yourself how much you spend right now on Google AdWords without ever having spoken to a sales rep. How does this compare to your own average selling price for online transactions?Â Now, ask yourself why.Â The answer is transparency, from company reputation to cost-per-click.
PS Trish Bertuzzi from Bridgegroup asked for specific examples, so please see the comments if you are interested in the response. And, feel free to add your own examples of SaaS vendors that are doing a good job at transparency.
More posts in the SaaS Marketing Tips Series:
- SaaS Marketing Tips – Metrics that Make a Difference
- SaaS Marketing Tips – Don’t Be CRUD on the Cloud
- SaaS Marketing Tips – Search is About People, Not Engines
Great post on transparency. Inspired me to write a response blog post which can be found here (http://resource.onlinetech.com/transparency-in-saas-iaas-and-all-as-a-service-companies/).
I added in some game theory to your reasoning and applied it to all as-a-Service companies.
Would love to hear your input on it!
[…] reading a great article by Joel York over at his SaaS Blog, Chaotic Flow. In his article, “SaaS Marketing Tips â€“ The Truth Shall Set You Free“, he explains the critical difference in the sales process between selling traditional […]
I think that there are several successful SaaS Companies that do a great job of this. Two that quickly come to mind are:
Twilio: clearly addresses how the Telephony Web Services works, displays clear service levels & pricing, provides good product/implementation documentation, and invites customers to openly discuss service & support related questions via their Forum.
Vertical Response: while there are several SaaS e-mail marketing suites out there, VR does a good job of fostering community interactions. They have nurtured a loyal following of users/customers, who assist with addressing questions & concerns through the VR Forums (aka “VR Marketing Lounge”). They also product Blog content and follow-up educational pieces that further address the questions and concerns raised in the VR Forums.
You may find the post I wrote a few months back about transparency relevant and supporting your premise.
Amazon Web Services has done a really great job and clearly thrown lots of cash/man hours into the transparency strategy with clear ROI. They provide detailed system stats, a great security overview, and very open, active user forums. Salesforce.com has always touted their transparency, since the introduction of their trust center. WRT application functional performance, I don’t think anything can compare to Google AdWords. But, its also important for up-and-comers to set the right culture from the get go.
They may not have the cash that AWS has, but they can focus on their differentiators. At, Xignite we follow an e-commerce approach complete with shopping cart with detailed, public pricing, as well as standard SLA terms and support plans in conjunction with the system performance stats guaranteed by the SLA. Marketo also does a nice job with its trust center.
Would love to see other examples from interested readers. Please comment!
Thanks in advance for your help…another great post!