A sales cycle refers to an iterative strategic process that salespeople follow to turn prospects into customers. Besides driving your salespeople to close more deals in less time, a shorter sales cycle can offer many benefits to both the buyer and seller.
Because of this, you're likely to find 'speed up the sales cycle' at the top of many organisations' to-do lists. This is particularly true in the software as a service (SaaS) space, where sales cycles tend to lean towards the longer end of the scale naturally.
In this article, we define the B2B sales cycle and its typical components in the SaaS field, discuss elements that affect its length, share tips on how to reduce the sales cycle and explain the benefits of doing so.
What is SaaS Sales Cycle?
The SaaS (Software as a Service) sales cycle refers to the process of selling and onboarding customers to a subscription-based software solution. It typically involves stages such as prospecting, lead generation, qualification, product demo, negotiation, contract signing, implementation, and ongoing customer support. The cycle emphasizes the value proposition of the software, addressing customer needs, and building a long-term relationship to ensure successful adoption and retention of the service
5 tips for how to reduce your B2B SaaS Sales Cycle
When considering how to shorten your sales cycle, it's essential that you focus on maximising your customer acquisition and retention while minimizing the time spent doing so. Shortening a sales cycle doesn't mean dropping stages of the cycle or lessening the attention prospects in each stage receive; it simply means removing friction and fine-tuning the efficiency of stages that might be slowing you down.
Below, you can explore some top tips on how to reduce your SaaS sales cycle:
Tip 1: Assess each stage of your SaaS sales cycle
To know how to speed up your sales cycle, it's essential that you identify how each stage of the cycle is currently performing. Without oversight of your entire sales process, it's hard to identify its strengths and weaknesses. It can be a great idea to look at conversion rates between stages to identify any bottlenecks in the system. At what point does your sales cycle seem to come to a grinding halt?
For example, it could be the quality of leads your sales reps are working with that’s slowing down the process. Or it could be the time it takes to get a product demo in front of a prospect. It could even be that your sales reps aren't equipped to conduct a thorough enough follow-up process... or maybe a combination of all three! Whatever the reason, it's important to know which stages need work to shorten your sales cycle effectively.
Tip 2: Leverage your marketing efforts
Letting marketing do the 'heavy lifting' can be an excellent way to speed up your sales. In an era where consumers are more willing than ever to self-educate, ensuring your website, social media platforms and any other marketing channels provide them with the best resources to do so is critical to speeding up your sales cycle.
Leveraging marketing is a joint effort in which your sales and marketing teams can work cohesively to ensure the right sales content is available to the right people at the right time. Having prospects at the bottom of your sales funnel who are already familiar with your product and the value it offers can reduce the amount of work needed as you nurture prospects through its various stages.
Tip 3: Enabler your sales reps
Sales enablement contributes significantly to how long a sales cycle is. Enabled salespeople are more likely to move prospects through the cycle in less time. Empowering your sales team is about putting them in an optimal position to allocate each deal the support it requires and create the most buyer-friendly sales process. You can empower your salespeople by providing them with effective processes and the right training, sales materials and tools to see a sale through from start to finish, seamlessly. This might include, for example, giving them access to a demo library that they can independently share without requiring support from presales.
You may also choose to empower your sales team by incentivising them or introducing recognition programs through which they might feel inspired to perform at their best. Typically speaking, empowered salespeople have a higher level of job satisfaction. This can translate to many other benefits, which can also help to shorten your sales cycle. These might include, for example, enhanced collaboration and communication.
Tip 4: Enable your buyers
Both selling and buying are challenging, so it's just as important to enable your buyers as it is to empower your sales team. The easier you can make it for prospects to buy your product, the more deals your sales reps are likely to close. In order to enable your buyers, you need to know them well. A solid understanding of your buyer's persona can help you deliver them a customer experience that guides them effortlessly through the sales process.
Buyer behavior has seen a massive change in recent times. Out of the entire purchasing process, a buyer is likely to spend less than 20% of the time in direct contact with the vendor. Why? Because they're spending the rest of their time conducting research and building a case for key stakeholders. By making it easy for them to self-educate and giving them the right materials, you can not only let them do a lot of the internal selling work for you, but you can also significantly speed up the sales process.
Tip 5: Prioritise automation
There can be multiple processes and tasks within a sales cycle. To shorten the sales cycle, it's essential that you aim to prioritise automating as many of these processes and tasks as possible. This doesn't mean losing the human touch. In fact, through automation, you can regain the human touch that might have been lost due to stretched presales because of a lack of automation.
Consider a product demo. You could have demo engineers spend days manually building a demo from scratch. Or you could invest in a demo experience platform that automates all the mundane, time-consuming, non-sales bits and leaves just the final touches for the sales rep to add their magic too. That's a highly personalized product demo on a client's desk in a fraction of the time. Apply that to every qualified lead and you've got yourself a significantly shorter sales cycle.
6 B2B SaaS Sales Cycle Stages
A SaaS sales cycle typically involves the following fundamental stages, some of which may require more time than others:
Stage 1: Generating leads
This initial period of the sales cycle is primarily marketing-driven and involves companies driving inbound and outbound leads into their sales funnel. These leads might come from various targeted sales content, social media platforms or Google ads, for example.
Stage 2: Qualifying leads
Companies then qualify their leads to avoid wasting resources on inquiries with little promise of going anywhere. They may automate this process using various tools and technology or do it manually through an initial interaction with leads, for example, over the phone, to clarify their level of interest.
Stage 3: Engaging prospects
Once leads are qualified, they're moved through the sales cycle to the engagement stage. During this stage, salespeople aim to engage them by identifying their pain points and then effectively showing how the particular software can resolve them through a product demo or free trial.
Stage 4: Handling objections
Upon presenting solutions to prospects, they might have concerns about various aspects of the product, for example, the pricing structure or certain features. During the objection handling phase, sales reps usually gain an understanding of prospects' objections and then help them see the value the product offers.
Stage 5: Closing deals
At this part of the sales cycle, a prospect becomes a customer. While not every sales cycle may reach this step, it is, of course, the objective.
Stage 6: Nurturing new customers
An effective sales cycle doesn't wrap up once the salesperson closes a deal. Once they gain a new customer, it's important to nurture them, which might be through exceptional customer service, thorough onboarding, and helpful upselling.
What are the key aspects that make your SaaS sales cycle lengthy?
The length of a SaaS sales process can vary depending on various factors, but several key aspects can contribute to making it lengthy. Understanding these factors can help you streamline the sales processes and improve efficiency. Here are some key aspects that can make a SaaS sales process lengthy:
1. Complex Sales Cycles
SaaS solutions often serve various industries and verticals, each with its unique challenges and requirements. Navigating complex B2B sales cycles, especially in highly regulated industries or large enterprises, can significantly lengthen the sales process.
2. Target Audience
Selling to enterprise-level customers typically involves longer sales cycles than selling to small or mid-sized businesses. Enterprise customers often have more stakeholders, complex decision-making processes, and longer procurement cycles.
Personalising your SaaS product demos or integration with a customer's existing systems can extend the sales cycle. Product customizations may involve scoping, negotiations, and development work that would affect the length of the overall sales cycle.
4. Regulatory Compliance:
If your SaaS solution deals with sensitive data or operates in regulated industries like healthcare or finance, meeting compliance requirements can slow down the sales process. Customers may have strict security and compliance demands that need to be addressed.
5. Multiple Decision Makers:
In B2B SaaS sales, there are often multiple decision-makers involved in the purchasing process. Aligning their priorities, getting buy-in from various stakeholders, and addressing their concerns can take time.
What are the Advantages of reducing your B2B SaaS sales cycle?
In a nutshell, shortening your sales cycle length can have a direct impact on your bottom line. Below, you can explore some of the other primary advantages:
- Increased revenue: Essentially, a shorter sales cycle means more deals in less time. The shorter the sales cycle, the more customers sales reps can handle, the less time there is for things to go awry and the larger the volume of sales they can make.
- Boosted sales team morale: A short sales cycle can allow salespeople to transform prospects into customers in less time. Seeing frequent results can motivate salespeople and drive further performance.
- More engaged customers: A shorter sales cycle can keep a customer engaged in the sales process, unlike a longer sales cycle, which may cause them to become complacent. Customers tend to lean towards favoring a shorter cycle, too, assuming they receive excellent customer service and a quality product.
- Competitive advantage: Shortening your sales cycle involves finding and continually enhancing sales processes that work, largely by making improvements based on market feedback. Polished processes and an in-depth understanding of what your market actually wants are both essential to developing a competitive edge.
Reduce your SaaS sales cycle with Demoboost
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