Virtually all selling in the B2B enterprise space today is to Cubicle Village, not decision makers.
The difference is stark. A decision maker is driven to make things happen; the bureaucrat is not driven at all. Bureaucrats live every day making sure they are employed the next day and have a home in Cubicle Village.
Decision makers have an inverse relationship with their knowledge of a company and its products. The more they know about what it is one is selling the less important it is to hear from a sales rep. They have bureaucracies to deal with what they know.
That bureaucracy lives in Cubicle Village.
Cubicle Village dwellers have a different relationship with B2B enterprise reps—they will take many meetings while the executive will take one. The Cubicle Village resident serves as an activity trap for the clueless B2B sales person.
Meetings happen, not much results.
Who you sell to is a function of how disruptive your product is.
If it is a low-level, transactional quality assurance tool, look to spend time in Cubicle Village; look to spend your career there. You will make weekly sales calls, presentations, pass out T-shirts, logowear and pay for high carbo lunches for teams wearing shorts and flipflops.
When one is selling in Cubicle Village, the marketing costs are breathtaking.
There are the trade shows, webinars, the user groups, cascades of events to keep the buying bureaucracy thinking of your offering. While those dollars may be a necessary investment, that investment is required because you cannot get to a decision maker.
Sales cycles in Cubicle Village are long and painful; its inhabitants have lots of time on their hands. And they do not make decisions.
They are pretty hungry. They need lots of lunches and dinners—often served from Tex Mex restaurants.
Sales to executives are bounded; they buy or they don’t. They do not screw around forever talking endlessly to sales people. That is why they are executives.
Why is B2B selling today almost 100% in Cubicle Village?
The first reason is because 99% of all technology products are known to the buyer. Everyone knows what VMware, SAP, Dell and the hundreds of security products do. Or they can look them up on the sites and link them with the appropriate bureaucrat in that space.
75% of all executive buyers know all they need to know about a product before ever meeting with a sales rep. They Google it.
There is zero differentiation among the vast majority of tech products.
In the security space alone, there are now over 300 vendors, each with a slightly different twist of security, at a single trade show. The executive would not be caught dead spending time listening to how one may be different than another.
If you are the startup CEO going to market, you have a choice. Do you want to sell to Cubicle Village or to the decision maker?
Selling to Cubicle Village requires sales and marketing expenses of 50% – 70% of revenue. Not much left over to innovate.
This is venture capital time. Time to take in alphabet challenging-rounds D, E, F, G round of private equity throwing a constantly overturning army of sales reps against the waves of corporate bureaucrats so you can sell just enough to get your exit event. Dilution for you and your employees.
Actually, if you are the CEO, you will get replaced within a year as you miss unachievable revenue targets set by your new “partners” on the board.
Selling to the executive is what everyone wants to do. But like all hard things, it is, well, difficult.
One has to think, quite critically about the entire field of vision needed to sell directly to the executive, the decision maker.
One needs to consider the different messaging. One needs to consider not using sales reps, rather, going in via trusted advisors. One needs to consider having more confrontational, clear messaging on one’s website. And most of all, one needs to consider if early venture capital helps or hinders getting to the executive buyer.
Critical thinking here, people. Not a knee jerk reaction.
Let’s not do what everyone else is doing.
We at Contingency Sales make the argument that taking in early venture capital actually forces one to sell to Cubicle Village, not to the decision maker.
The reasons are pretty clear. Venture capital makes one do stupid things really fast.
The first meeting with the VC “partner” after the initial round of funding is all about how to build out sales and marketing. Really ramp it up. Get to market fast, get to market early, get to market now.
Except the expense line is for sure, the revenue line is not.
This is because the first customers are always “early adopters” and they are not driven by the useless “inbound marketing” “outbound marketing” Marketo-driven machines of the software industry. These programs are knee jerk, first calls of the venture capital “partner.” They force you to bring in that brain-dead marketing VP who has “done it before” at an over-funded startup the VC was in.
Imagination is not the currency; activity for the sake of “leads” is the goal. And those leads need a small army of vastly over-paid sales reps, with 6 figure yearly expenses, to “capture.”
But selling to an early adopter?
This marketing VP wouldn’t know one if it were sitting next to him or her at Starbucks. The marketing VP and sales VP are the corporate bureaucrats of the software industry and they are built to deliver marketing machines, consuming up to 70% of revenue, to sell the masses.
Early adopters do not care about T shirts or the hats. They are the ones who, if you ever find them, will finish your sentences for you because they are looking for your product as hard as you are looking for them.
A couple of weeks ago, we had a call with the C-level technology executive of a Fortune 10 company. It was not in a cubicle.
As our CTO laid out our technology, the prospect asked two questions. That led to a different discussion about our product—one we had never considered.
He is an early adopter—and he began finishing our sentences for us.
Within the hour, we reached an agreement to deliver technology to them that would save, in their words, $1.2 billion per year. Does focus the mind, doesn’t it?
Our charge to them was a bit less, but enough to fund our company through what would have been a hundred rounds of VC money.
We have no sales force, because we sell through trusted advisors, one of whom set up this meeting.
We have no traditional marketing because we sell only to the early adopters—and they hate marketing as much as we hate spending a lot of money on it.
Our marketing is 100% via trusted advisors—who we educate one-to-one.
We have thought through the critical thinking problem of whether we want to sell to Cubicle Village or to decision makers and we chose the latter.
And we learned, early, that taking in venture capital would force us to sell to Cubicle Village, lose our equity, and miss our market.
We suggest critical thinking, not early venture capital.
ContingencySales.com brings disruptive technologies to market without early venture capital. We have portfolio companies in similarity search, fraud detection, software appliance, relationship marketing and data-in-use security. We are located in Austin, Texas.