Profitable Outcome Selling: A guide for B2B SaaS businesses at or beyond growth stage

Written by Nic Delaye , with key contribution from Lionel Berger

In today’s macroeconomic environment, B2B SaaS Go-To-Market (GTM) Leaders and CEOs/Founders are facing a hard reality. They need to steadily increase the number and size of deals, and drive world-class adoption and retention, while radically improving GTM productivity, with fewer opportunities to influence buyer decisions and shrinking software spending.

Profitable Outcome Selling can solve that conundrum.?

Profitable Outcome Selling is a mindset enabling B2B SaaS businesses to reach, win and grow large and strategic customers at scale and efficiently, by repeatedly aligning customer outcomes with company capabilities from pre- to post-sales.?

For example, SaaS companies aiming to sell new Generative AI (GenAI) capabilities should go to market with a coherent narrative of transformation and measurable outcomes. Such a narrative serves two purposes: (1) differentiate from the myriad of competitors and (2) persuade enterprises to unlock budgets for investment. Today, while a majority of enterprises are likely experimenting with AI, it's important to recall that back in 2020, merely one out of ten companies reaped substantial benefits from the AI technologies predating GenAI [1]. Moreover, BCG notes that 70% of the effort required to derive value from AI is channeled towards innovating new business processes or metamorphosing existing business functions, rather than the technology itself [2].

Profitable Outcome Selling is based on seven years of hands-on experience building and refining Strategic GTM capabilities at ServiceNow and Stripe, in collaboration with many professionals who built similar capabilities at companies such as Salesforce, Oracle, SAP, VMware and AWS.??

It borrows and augments best practices from industry-recognized sales methodologies like Value Selling and MEDDIC, and integrates them in a customer-centric, seller-friendly way.

This article defines Profitable Outcome Selling and its benefits, and provides real-world examples and practical tips to get started.

It is aimed at GTM leaders and field sales/pre-sales/customer success professionals in B2B SaaS businesses that are:

• At growth stage and beyond (>$10M Annual Recurring Revenue)
• Serving the Upper mid-market ($100M-1B Annual Revenue) and Enterprise (>$1B Annual Revenue) segments.?

While this article is focused on B2B SaaS businesses, the principles of Profitable Outcome Selling apply to any B2B Tech business, especially industrial companies looking to expand their software offerings.?

Profitable Outcome Selling Highlights

• Symbiotic buying and selling experiences: Align the seller's mindset with the buyer’s priorities from pre- to post-sales, and deliver value to both buyers and sellers.
• Executive positioning: Elevate the narrative to higher order customer issues across account planning, envisioning, solutioning, execution readiness and deal closing, to accelerate sales.
• Continuous best practice building: Appoint champions who will work cross-functionally to pilot practices and assets on a few large and/or strategic deals, and continuously refine.
• Rightsized practices and assets: Aim for “one size up” on GTM maturity, and pick minimum practices and assets needed to close and drive adoption in various customer situations.??
• Strategic scaling: Elevate the DNA of the GTM organization by “winning hearts and minds” one team and/or region at a time, and through a tiered enablement model that turns 'best practices' into 'common practices'.
• Influenced growth and efficiency: Set semi-annual / annual lagging influenced revenue growth and sales efficiency targets. In the first 12-18 months, consider net new revenue targets per Profitable Outcome Selling FTE of 3-5X the average seller’s quota, and a target of 0.9-1 for the ‘magic number’* related to account cohorts covered by Profitable Outcome Selling [3].

*Ratio of new revenue generated by every dollar spent on sales, customer success and marketing?

A SaaS performance “perfect storm”

SaaS selling is becoming harder and harder. Gartner research found that when B2B buyers are considering a purchase, they spend only 17% of that time meeting with potential suppliers, thus discounting the perceived value of sellers [4]. In many cases, the real decision-maker is only tangentially involved in the buying experience. The average Annualized Contract Value (ACV) was at its lowest point in three years in Q2'2023, according to Vendr, a SaaS buying SaaS platform [5].?

But guess what, SaaS buying is becoming harder and harder too. Gartner research found that the typical buying group for a complex B2B solution involves six to 10 decision-makers, each armed with four or five pieces of information they’ve gathered independently and must deconflict with the group. At the same time, the set of options and solutions buying groups can consider is expanding as new technologies, products, suppliers and services emerge [4]. As a result, SaaS buyers are scrutinizing ROI more than ever, switching to lower-cost alternatives before renewals, and prioritizing usage-based pricing models [6].?

These SaaS selling and buying challenges are aggravated by slowing year on year SaaS revenue growth, driving SaaS investors and leaders to focus on GTM productivity vs. “growth at all cost”, including by shifting strategies from sales-led growth (SLG) to product-led growth (PLG) [7].

Risks of this “perfect storm” for SaaS businesses

• Race to the bottom, with “feature bake offs”, commodity pricing and sellers as “order takers” becoming the new normal
• Slowing growth due to insufficient large deals to meet revenue targets and investor expectations on share of wallet?
• Subpar Net Dollar Retention (NDR) rates due to slow customer technology adoption post-deal - or worse, debooking/churn after a few months
• Diminishing moat as sales plays become less customer-centric for the sake of “repeatability” and “efficiency”
• Low return on previous GTM transformation investments such as Value Selling or MEDDIC enablement, specialized customer advisory resources and functions, etc.?

The Profitable Outcome Selling “storm breaker”

Profitable Outcome Selling addresses these challenges by aligning the seller's mindset with the buyer’s priorities from pre- to post-sales:?

Impact, deliverables and success factors

Targeting both direct and scaled impact?

Profitable Outcome Selling should both be rolled-out to large or strategic deals (direct impact) and embedded in the DNA of the GTM organization (scaled impact):

1. Direct impact: Engage with customer executives and partner with the SaaS company’s ecosystem to envision the value of a strategic partnership, build trusted relationships, share insights, recommend solutions, and pave the way for rapid adoption.
2. Scaled impact: Increase the SaaS company’s mind share in the market, build repeatable solutions and sales plays that actually make sellers’ lives easier, and influence the marketing narrative and product roadmap to increase adoption at scale in strategic markets and industries.

Deliverables and how they integrate in the sales cycle and customer journey

While most of the following deliverables may be needed on large and complex enterprise deals, sellers might need just a few of these on smaller deals i.e., the approach is highly modular.

1. Strategic account planning. Confidence in a path to a profitable and mutually beneficial partnership with the customer. Business overview: How they make money. Top three company priorities and challenges. Priority funded initiatives. Addressable opportunities: Priorities and challenges addressable with capabilities that are “on the truck” or “on the assembly line”. Value at stake for the customer. Competition and differentiators. Size of the prize: Total addressable market. Current share of wallet. Prioritized share of wallet areas to grab.?Stakeholders: Decision makers and influencers in business, technology and operational roles. Account growth roadmap: Current revenue. Revenue target in 2-3 years. 3-5 opportunities to move from current to target revenue numbers, with targets at the opportunity level.
2. Executive envisioning. Confidence in a successful future state for the customer enabled by the SaaS capabilities. Executive education: Plain English description of the problems and solutions addressed by the SaaS capabilities. Market trends and customer stories showing why key players are acting, and what they’re focused on.?Shared vision and strategy: Compelling vision statement describing a buyer’s future state powered by the SaaS capabilities. Strategy on a page, mapping the buyer’s priorities and challenges with key capabilities and quantified achievable business outcomes e.g., revenue increase, cost reduction, productivity improvements, etc. Current/future state architectures: Business architectures showing key capabilities (customer, vendor, third parties), starting with a future state depicting the customer using all or most of the capabilities (the infamous “art of the possible”), and then showing the current state, thus highlighting not just what the customer is using (if anything) but what they’re not using. Capability roadmap: Key stages to move from current to future state, including incremental capabilities, countries, BUs, volumes, etc. at each stage. Value hypothesis: One or more statements of value that the customer will achieve at different phases of the roadmap, illustrated by outside-in, “back of the envelope” estimates.
3. Human-centered solutioning. Confidence in the solution’s ability to address both the buyer’s requirements and end-user needs and pain points. Prioritized use cases: List of use cases needed to achieve the desired outcomes, prioritized based on desirability (how much do end users and business / tech owners want the capabilities?), viability (can the capabilities be delivered within acceptable business constraints?) and feasibility (can the capabilities be built and run with the available technology and within the operational constraints?)?Current/future user journey maps: Visualization of the experience of end-users interacting with the platform as it exists today (current) and how it could be improved or evolved in the future (future), highlighting touchpoints, pain points, and opportunities for enhancement. Solution design and architecture: Structured description of the solution, ensuring it effectively addresses the needs and pain points of end-users and stakeholders. Personalized demos for key stakeholders: Demos that showcase the most inspiring capabilities of the proposed solution to decision-makers and influencers, including capabilities that are on the product roadmap within the proposed partnership timeframe.
4. Execution readiness. Confidence in all parties’ readiness to build and run the solution and deliver expected outcomes.?Ecosystem strategy: Description of the role of all parties involved in building and running the solution, including (if any) in-house vs. third party professional services. Include multiple options with pros and cons.?Implementation strategy: Approach to build the solution e.g., “Big Bang” vs. staged, Country/BU ramp up, success metrics by phase, etc.?Delivery plan: Key milestones and projects needed to build and run the solution, and realize expected outcomes. Resourcing plan and costs: People and other resources needed from the customer, the vendor and partners to execute the delivery plan, with associated costs. Business case: Total cost and benefit estimates of the entire solution, including build and run costs, ramped P&L and non-P&L benefits, and “worthiness” metrics like ROI, NPV or Payback Period.
5. Deal closing. Confidence in both parties' commitment to deliver their end of the agreement. Executive-grade proposal: Easy to consume, plain English description of customer needs, and the proposed solution and path to build and run it. Business value assessment. Clear and transparent pricing aligned with the solution components. Case studies. Executive readout: Presentation of the proposal to the decision-makers and influencers, ideally by the customer champions with the vendor support.???

Success factors

The value of Profitable Outcome Selling

Value to buyers

• Expand their thinking: Broaden their perspectives on challenges/opportunities and available solutions.
• Make their life easier: Simplify and de-risk the buying decision by getting everyone onboard.
• Deliver results: Ensure the realization of expected business outcomes from the investment.

Value to sellers

• Sell more: Elevate the company’s brand and positioning to generate more demand and increase competitive win rate.
• Sell larger: Sell multi-product, complex solutions to more senior executives across multiple buying centers.
• Sell more efficiently: Codify learnings from strategic deals into playbooks that sales teams can apply consistently while reducing deal workload.

Real world examples

Reframing and broadening customer needs

A mid-market SaaS Platform asked for a proposal on the base product, and was only interested in comparing features and rate. The Outcome Sellers came back with a personalized, value-first vision and strategy that would transform their entire infrastructure, on a broader scope than their initial request. It intrigued them. The Outcome Sellers then refined this vision, strategy, roadmap, solution and business case with the business and technical buyer organizations, and with key influencers. The SaaS company won the deal on a bigger scope, despite being the most expensive.

From upsetting to upselling

A large enterprise was not seeing the value from the products they bought from a SaaS company, and was considering a de-booking. The Outcome Sellers met the customer’s executive buyer to understand their top three priorities, and then came back with an hypothesis of how they could help them address these priorities with their platform - while addressing the relationship challenges. This led into a series of envisioning, solutioning and readiness activities, including a shared vision/future state/roadmap, a personalized digital experience showcasing the solution to their CEO, an implementation plan and a business case. As a result, the SaaS company closed one of the largest deals in Europe that year, with a 4-year revenue commitment, and a follow-up large deal the following year.

Making QBRs CEO-grade

A mid-market company had been using a SaaS platform for years. The account team was preparing for the next Quarterly Business Review (QBR), which was going to be focused on operational performance. The Outcome Sellers built the QBR narrative around the top three priorities of the new CEO, and managed to get them invited - including an inspiring vision of their platform powered by the SaaS platform in three years, and outside-in estimates of additional revenue they could generate with the SaaS platform. This resulted in 4 net new sales opportunities for a 2-day’s investment.

Profitable Outcome Selling vs. other approaches

There is a plethora of sales methodologies designed to achieve similar goals as Profitable Outcome Selling, such as:?

MEDDIC/MEDDPICC

Provide a structured approach to sales, aiding in the qualification and pursuit of potential customers.

Value selling

Emphasize the value or benefit that a platform brings to the customer rather than focusing solely on its features or pricing.

Solution selling

Identify and solve customers’ problems through tailored solutions based on repeatable plays.

Industry selling

Tailor messaging and solutions to the specific needs, characteristics, and regulations of a particular industry.

Consultative selling

Prioritize relationships and open dialogue to identify and provide solutions to customers’ needs.

Executive selling

Engage and sell to executive-level decision-makers within target customers and prospects.

Vision selling

Help customers envision a future where their problems are solved or their situation is improved through the use of the product.

Profitable Outcome Selling borrows best practices from all these methodologies and integrates them in a seamless customer-centric, seller-friendly way across the sales cycle and customer journey.

How to get started and deliver impact fast??

Step 1 - Appoint champions for building capabilities on the back of a few deals

Appoint people that bring a mix of strategic thinking, customer-centric design, technical proficiency, sales acumen and stakeholder management skills:

• If you don’t have a Pre-sales team: appoint Sales Managers and/or Reps with a track record of closing large and/or strategic deals in the organization
• If you have a Pre-sales but no Sales overlay teams (Product Sales, Value Consulting, Executive Advisory, Enterprise Architecture, etc.): appoint Pre-sales Managers and/or Consultants with a track record beyond technical selling
• If you have both a Pre-sales and Sales overlay teams: appoint leaders from within the Sales overlay teams and Pre-sales champions

Adjust the capacity model and align incentives: ensure the appointed Outcome Sellers have the bandwidth to focus on strategic and/or large deals, as well as growth and efficiency incentives aligned with the overall GTM goals of the organization.?

Step 2 - Strategically scale capabilities to the entire GTM organization

Partner with sales enablement (if such function exists) to build and roll-out a tiered enablement model:

• 1:1 - Supported deals that meet certain criteria e.g., size, access to power: conduct “on-the-job” learning, including “stretch” responsibilities for activities like workshop facilitation and business cases
• 1:Few - Target account cohorts: train leaders who will train and coach their teams
• 1:Many - Target markets and industries: share successes and best practices in town hall meetings, sales forums, etc.
• 1:All - Entire GTM organization: integrate best practices and assets in Knowledge / Learning Management Systems, Certification Programs, etc.

Step 3 - Learn and adjust based on growth and efficiency metrics

Set lagging/output and leading/input objectives and key results e.g.:

• H1’Y1: Influenced deal progression. Net new executive relationships. Coverage (accounts, deals, enablement).?
• H2’Y1: Influenced deals closed. Win rate. Internal self-serve adoption.
• Y2: Influenced YoY net new revenue growth, net dollar retention and sales efficiency improvements. Repeatability. Influenced product ships. GTM partner enablement.

Track progress against quantitative metrics and obtain feedback from field sales, GTM managers, customers, partners.

Adjust the operating model every 6-12 months e.g., target accounts / deals, resourcing success metrics.

Conclusion?

This article laid out tangible Profitable Outcome Selling practices that can be rolled out at scale by B2B SaaS businesses at or beyond growth stage who serve upper mid-market and enterprise customers, to balance accelerating scaling with higher sales efficiency.

Profitable Outcome selling is a vast subject with an endless amount of literature and opinions that is impacted by rapidly evolving trends such as the macro-economic environment and the emerging impact of Generative AI on B2B selling.??

Feel free to share this article and submit any comments or questions via LinkedIn Messaging at https://www.dhirubhai.net/in/nicdelaye/ or email at [email protected] .

Sources

1. BCG (2020). Are You Making the Most of Your Relationship with AI? Retrieved from https://www.bcg.com/publications/2020/is-your-company-embracing-full-potential-of-artificial-intelligence
2. BCG (2022). Five Rules for Fixing AI in Business. Retrieved from https://www.bcg.com/publications/2022/5-rules-for-fixing-ai-and-machine-learning-for-your-business
3. McKinsey (2023). From product-led growth to product-led sales: Beyond the PLG hype. Exhibit 2. Retrieved from https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/from-product-led-growth-to-product-led-sales-beyond-the-plg-hype#/ ?
4. Gartner (2020). The B2B Buying Journey. Retrieved from https://www.gartner.com/en/sales/insights/b2b-buying-journey ?
5. Vendr (2023). The SaaS Trends Report. Retrieved from https://www.vendr.com/insights/saas-trends-report-q2-2023#SaaS-pricing-snapshot ?
6. Zluri (2022). The Top 5 SaaS Buying Trends in 2023. Retrieved from https://www.zluri.com/blog/saas-buying-trends/ ?
7. Openview Partners (2023). Product Benchmark Reports. Retrieved from https://openviewpartners.com/2023-product-benchmarks/ ?

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