According to this article Cloud companies are getting "hammered" by the stock market because sales cycles are getting longer.
This we find hard to understand. Yes, in the "real world" sales cycles are getting longer, more people are involved in the sales process and more and more people have to have their say before a product is purchased. But not if you take control of the sale with social selling.
First, many companies are way too reliant on "Marketing" to create, develop and nurture the leads. In our benchmarking this is something like 40% of the "Marketing to Close" sales cycle.
Our resolution?
Place prospecting in the hands of the salespeople and do this with social selling. Make sales people self sufficient when it comes to lead generation.
Most sales teams should be able to make one additional lead or meeting a week. Assume a (conservative) win rate of one in 4. That's means sales are closing an additional sale every month.
Assume a (conservative) 10 month year, that's 10 additional deals a month.
Average deal size $50,000.
That's an additional $500K per sales person, per year, that's an additional $5 Million per 10 sales people.
All with a 40% reduction in sales cycle.
Not a bad business base.
Obviously this assumes your sales people can execute, but assuming that, it should all be doom and gloom. Companies take pro-active steps to reduce sales cycles, increase incremental (new) revenue and gain competitive advantage.
Investors have pulled back on enterprise software stocks as some have reported longer sales cycles.Cloudera announced the departure of its CEO amid difficulties with the business.Pivotal Software and Zuora cited challenges related to sales execution.