If you’re part of all the excitement around Dreamforce 2011 be sure to come and meet us. You’ll recognize us right by the Tango dancers (what can we do, rhymes with Totango…).
We also thought that this would be a great opportunity to introduce Totango to a wide audience of SaaS sales and executive teams. For that end we’ve started a twitter campaign at www.totango.com/win-ipad2. People who help us spread the word may win a new iPad2 and more importantly will be able to use Totango to get meet their quota.
If you’d like to schedule sometime to discuss Totango in more details please write me at guy@totango.com
If you’re part of all the excitement around Dreamforce 2011 be sure to come and meet us. You’ll recognize us right by the Tango dancers (what can we do, rhymes with Totango…).
We also thought that this would be a great opportunity to introduce Totango to a wide audience of SaaS sales and executive teams. For that end we’ve started a twitter campaign at www.totango.com/win-ipad2. People who help us spread the word may win a new iPad2 and more importantly will be able to use Totango to get meet their quota.
If you’d like to schedule sometime to discuss Totango in more details please write me at guy@totango.com
Managing a Software-as-a-Service (SaaS) business isn’t trivial. Successful SaaS companies are able to deal with a high volume of leads and turn those into a high volume of loyal customers with fast response and turnaround time.
This is often referred to as the ‘sales and marketing machine’ – a highly optimized, massively scalable and controlled business operation that is capable of:
Continuously increasing the service value, differentiation and offerings.
In order to build a ‘sales and marketing machine,’ companies need to invest in the tools that will get them the business scalability that is required and reduce the learning curve.
Many startups begin with homegrown solutions using spreadsheets and databases (with a bit of integration glue in between). This is sufficient for small scale, but quickly becomes unwieldy as the organization grows. Luckily, there are excellent tools available for SaaS companies to leverage.
Many vendors have a “starter” package, so there is really no excuse not to start building your tool-chest sooner rather than later.
The Customer Life-Cycle
To best understand where the different categories of tools fit, it’s best to look at the various stages of the customer life-cycle, as they evolve from early prospects to mature customers.
At Totango, we use the following customer life-cycle terms:
Visitor – Anonymous user on the website
Lead – Person who has expressed some interest in the service. This can be anything from downloading a white paper to signing-up to a trial
Evaluating – A user (or company) who’s actively evaluating the service usually during a trial period or fermium
Onboarding – A paying customer in the initial usage period
Mature – A paying customer who has been loyal to the service beyond the initial usage period
With those definitions in mind, it’s easier to associate solutions and tools to help carry customers through every phase of their life-cycle.
CRM (Customer Relationship Management)
CRM is a common way to keep a reference of all customers’ life-cycle stages. CRM organizes all contacts’ information and account details in a single database, so it’s vital you select a tool that fits your needs and can grow with you.
Primary users
Specifically, your CRM software will be the main working software of your inside sales teams as they organize account work mainly during the sales life-cycle phases.
Web analytics tools keep track of visitor activity on your website and various other marketing properties; this is where you keep track of your top-tier leads funnel, measure the initial success of marketing and advertising programs, and work to improve visitors’ experience with your products’ properties.
Primary users
Mainly the marketing team, though other users in the organization (product team, IT) will need to use it as well.
Select list of Web Analytics solutions Google Analytics is the most commonly used tool. It’s immensely powerful, feature-rich and free. But there are other good tools your marketing team should look at, such as Clicky, WebTrends that provide additional useful views into vistiors’ actions.
Marketing Automation
Marketing automation takes you beyond basic web-properties and aims to help you interact, build, and cultivate a relationship with leads, so they can ultimately be passed on to your sales team and “convert” to happy customers.
Primary users
This is your marketing team’s main toy!
A post marketing (sales & customer success) solution stack for SaaS companies does not exist yet. Enabling the buying process (converting leads), ensuring customer success, and increasing service value, is something that I feel is needed and missing in the market, and this is what we’re building in Totango.
SaaS Dashboard
Having all the above tools in place enables marketing, sales and customer success teams to effectively do their jobs and be an integral part of the ‘sales and marketing machine’.
Having said that, it’s crucial to have a single business dashboard available to the executive teams that allows them monitor the business end-to-end.
The SaaS dashboard should include operational metrics, trends and key business performance indicators (KPI’s), which allow the business owners, get ‘the full picture’ of the business, identify bottlenecks and allow to teams to take appropriate actions.
Summary
The SaaS model presents an opportunity to run a predictable and high-volume business. The first step is to put the required business infrastructure in place in order to monitor, analyze and optimize the sales and marketing machine operation continuously.
In coming posts, I’ll discuss in further detail the actual attributes of the SaaS dashboard.
Today we’re announcing our $3.8 million Series A financing as well as opening our service to the public with a free beta offering.
I wanted to give a bit of a personal perspective to what is being announced today and put it in context.
In early 2009 I was looking for the next opportunity. Cloud computing in general and Software-as-a-Service specifically were continuing to rapidly gain ground and it was clear that almost every aspect of the software was undergoing massive change: how software is delivered and consumed, bought and sold; everything was changing.
It was clear that while SaaS presents enormous opportunities for vendors, it also introduces new challenges. Much of the focus in the industry has been on the technical aspects of these challenges: how to build scalable, high-performing, reliable multi-tenant services. But while these technical challenges are interesting and important, we felt that not enough attention was being given to the business side. In SaaS, the customer engagement model is fundamentally different.
The SaaS Customer Engagement Challenge
Most SaaS companies put their services in front of potential customers on the web and allow for a self-paced evaluation process. The sales process is no longer controlled by the companies’ sales people. However, sales teams do need to keep up with the high volume of evaluating prospects and make sure the users find what they need to make a favorable buying decision.
Most SaaS pricing models are based on subscription or usage, which allows customers to stop using — and stop paying for — the service at any time. That, plus low switching costs, mandates that SaaS companies constantly monitor customer satisfaction and improve the value that is being delivered.
In addition, the engagement between customers and the business is indirect. There are almost no customer visits, minimum sales calls, and most of the interaction between clients and the business is usage of the service. This no-touch and low-touch engagement model creates a wide gap in how companies understand their customers.
But there is one huge advantage SaaS companies have over their traditional counterparts — they can measure the actual way in which prospects and customers use their products. That is, if they have the tools to properly track and analyze such activities.
Helping SaaS Companies Understand Their Customers
So we set out to help SaaS companies understand their customers through their actual interactions on the service. It also quickly became clear for us that [1] customer facing staff — sales, customer success and others – are looking for practical and actionable solutions [2] based on this information, and not YAD (or yet another dashboard, as it is often referred to).
Before we wrote a single line of code, we talked to more than 50 SaaS companies, trying to validate our initial assumptions. It was clear from these conversations, and especially from the fact that many companies have developed homegrown tools that crudely attempted to address this need, that we were on to something.
Those homegrown solutions were developed, well frankly, half-ass, without a long term strategy. As a result, there was constant friction between the business users who need the information and the engineering team, which was already barely keeping up with its core product development responsibilities.
The Totango Solution
We created the initial version of Totango, and worked for almost a year with a number of SaaS companies of all sizes and industries in a private beta. From this we learned (and are still learning) how SaaS companies would like to analyze and act on customer usage information.
Today we are publicly releasing the first solution we developed through this process. It is a set of tools that help sales teams increase their effectiveness by improving the conversion rate of evaluating users into paying customers. We’ve built this by spending many days at the offices of our initial clients to learn their daily routines and practices so that we could provide the missing tools they’ve been looking for. The initial results with these private beta customers were amazing, and we feel very confidently that it is time to share our solution with a wider audience.
For now, the product is free. And although we will announce pricing in the coming months, we are planning to always offer a free tier.
When it comes down to it, we’re a SaaS company ourselves and we know first hand how important it is to get people up and running in minutes, so we’ve made sure Totango is as simple as can be to get going.
You can read our official press release here.
