ACCELERATED REVENUE GROWTH IN AN EVOLVING MARKET (Part I)
Unveiled at today’s Software & Information Industry Association (SIIA) Software-as-a-Service (SaaS) Executive Council meeting, this case study was developed to demonstrate how certain sales and marketing techniques can effectively accelerate SaaS revenue growth during the industry’s transformation. In this part, I’ve adapted the study’s executive summary and background sections to introduce a company referred to as “Jumpstart.”
I’ve masked the identity of the company for confidentiality and competitive reasons, but I’m not soft-peddling or overstating the issues its management faced. The solutions described are complete, and a future posting will include the actual results achieved.
In this post, I’ve described Jumpstart’s market and sales position at the beginning of the study period and summarized what its executive sales and marketing team did to transform the company’s value proposition in response to customer demand for more service-focused offerings. Jumpstart needed to re-brand and -position the company’s application as a full-service offering and launch a go-to-market strategy to rapidly expand into new markets. To do this, they employed the strategies I’ve always championed, even some of the things I discuss in this space.
The long and short of it is: By (a) positioning Jumpstart as a national (as opposed to “regional”) service provider, and (b) re-purposing the company’s marketing efforts to stress Jumpstart’s services as business process solutions (as opposed to technically-oriented tools), and (c) stressing urgency and customer service in its sales cycle, and (d) motivating its sales force to aggressively “hunt” new business, Jumpstart achieved phenomenal revenue growth of more than 290% during the two-and-half year period discussed.
HERE’S THE BACKGROUND:
At the beginning of the study period, Jumpstart operated a monthly recurring revenue business with a $12 million per year run rate. A wholly-owned subsidiary of a larger firm that held several related businesses, Jumpstart’s specialized applications supported its customers’ technical engineering functions in a specific market. With its flagship offering, Jumpstart had saturated its target customer base, and opportunities for growth existed primarily in other verticals. As the company entered a new fiscal year, its challenge was to accelerate growth in new markets and expand its customer list beyond the ~70 logos it had already acquired.
Historically, Jumpstart’s solution was a highly technical one, and its marketing and sales efforts had been directed at its customers’ engineers. The company’s sales cycle was long and unpredictable, with a contact-to-close period running anywhere from 90 to 240 days. Because new customer acquisition was spotty, Jumpstart’s sales organization had developed the habit of “farming” its existing customer base for pull-through revenues and renewal commitments, nearly 100% of which the company would have received in any event.
Two dynamics were developing that would disrupt Jumpstart’s sales and marketing approach and threaten its market leadership position. First, strong competitors were appearing in the marketplace; a well-funded start-up founded by former Jumpstart managers was unveiling competing products. Second, soft technology/software markets were imposing downward rate pressures for companies of all kinds, and wholesale failures were common.
To survive and prosper, Jumpstart needed to dramatically overhaul its value proposition, messaging, and sales process. In the next post, I’ll describe the steps Jumpstart took to re-brand and re-position itself in the market, and future posts will discuss the changes made to how the company improved its sales cycle and developed a compensation plan that contributed to Jumpstart’s explosive growth.
Stay tuned or check back often…
I’ve masked the identity of the company for confidentiality and competitive reasons, but I’m not soft-peddling or overstating the issues its management faced. The solutions described are complete, and a future posting will include the actual results achieved.
In this post, I’ve described Jumpstart’s market and sales position at the beginning of the study period and summarized what its executive sales and marketing team did to transform the company’s value proposition in response to customer demand for more service-focused offerings. Jumpstart needed to re-brand and -position the company’s application as a full-service offering and launch a go-to-market strategy to rapidly expand into new markets. To do this, they employed the strategies I’ve always championed, even some of the things I discuss in this space.
The long and short of it is: By (a) positioning Jumpstart as a national (as opposed to “regional”) service provider, and (b) re-purposing the company’s marketing efforts to stress Jumpstart’s services as business process solutions (as opposed to technically-oriented tools), and (c) stressing urgency and customer service in its sales cycle, and (d) motivating its sales force to aggressively “hunt” new business, Jumpstart achieved phenomenal revenue growth of more than 290% during the two-and-half year period discussed.
HERE’S THE BACKGROUND:
At the beginning of the study period, Jumpstart operated a monthly recurring revenue business with a $12 million per year run rate. A wholly-owned subsidiary of a larger firm that held several related businesses, Jumpstart’s specialized applications supported its customers’ technical engineering functions in a specific market. With its flagship offering, Jumpstart had saturated its target customer base, and opportunities for growth existed primarily in other verticals. As the company entered a new fiscal year, its challenge was to accelerate growth in new markets and expand its customer list beyond the ~70 logos it had already acquired.
Historically, Jumpstart’s solution was a highly technical one, and its marketing and sales efforts had been directed at its customers’ engineers. The company’s sales cycle was long and unpredictable, with a contact-to-close period running anywhere from 90 to 240 days. Because new customer acquisition was spotty, Jumpstart’s sales organization had developed the habit of “farming” its existing customer base for pull-through revenues and renewal commitments, nearly 100% of which the company would have received in any event.
Two dynamics were developing that would disrupt Jumpstart’s sales and marketing approach and threaten its market leadership position. First, strong competitors were appearing in the marketplace; a well-funded start-up founded by former Jumpstart managers was unveiling competing products. Second, soft technology/software markets were imposing downward rate pressures for companies of all kinds, and wholesale failures were common.
To survive and prosper, Jumpstart needed to dramatically overhaul its value proposition, messaging, and sales process. In the next post, I’ll describe the steps Jumpstart took to re-brand and re-position itself in the market, and future posts will discuss the changes made to how the company improved its sales cycle and developed a compensation plan that contributed to Jumpstart’s explosive growth.
Stay tuned or check back often…
posted by Ken Boasso at 14:33
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