Great article. This has real implications for SaaS pricing. e.g. If your market is SMBs, your JR AE sales person costs ~$50k/y with a reasonable expectation of selling 10x their salary in ARR, your pricing needs to be proportional to the number of customers in the top of your funnel / sales salary. It seems obvious, but often we think about price from a user and individual work perspective, with no sense of why it's…
Guessing a bit here— correct me if I'm wrong. This jargon is utterly foreign to me:
SMB = Small to mid-sized business (not server message block)
I know from a mathematical perspective this works in order to ensure that the company can be profitable at some point but a part of me wonders if it’s really necessary. I’ve never had a positive interaction with a sales person. But I’ve had countless positive interactions with customer support reps. One is over paid, the other under paid. If companies just created a sales team from their highest performing customer s…
I manage a CS team. Most CS reps are good at helping existing customers with particular problems but there's still a huge gap to fill in between CS and Account Manager. A good AM is skillful at finding out what's currently missing for existing clients,how it could be arranged and offered at the most suitable time. From what I've seen, these aren't the skills everyone's got or,more importantly,willing to get. I do, however agree, that some AMs are grossly overpaid. If I ask simple things during the initial call and all I get is 'let me check with my technical team', then it's a waste of time.Having said that, I've seen what a good sales person can do in really tough situations,where you'd think there's no way on earth anything cab be done now.
> But the reality is for most sales jobs, as a former colleague once told me, you're never more than 2 missed targets away from being let go. That sounds... fair? It’s like having a programmer that cannot program. If your job is literally to sell, and you’re not doing it? I guess it doesn’t have to be black and white as long as you bring in more than you cost though.
I can tell with certainty is that I was never ever under such pressure regarding my programming ability. I was never close to being fired and I seen only one company where people were often close to being fired due to temporary slip. Even under pressure, programmers don't really get to have hard to reach targets else they will be fired.
If you'd walk into a lead dev position after only fiddling with JS for 2 weeks by watching YouTube videos, you'd be kicked out faster than any sales person ever would. The reason you felt no threat was because you knew what you were doing,or at least knew good part of it. Sales people have one purpose in companies: to sell. There's nothing else. So if,after 2,3,6 months they can't do it, then of course nobody will keep them. Only shit companies hire/fire sales people like there's unlimited supply of them waiting to join,but even the good ones won't keep them forever if they can't do the job.
I can tell with certainty is that I was never ever under such pressure regarding my programming ability. I was never close to being fired and I seen only one company where people were often close to being fired due to temporary slip. Even under pressure, programmers don't really get to have hard to reach targets else they will be fired.
If you'd walk into a lead dev position after only fiddling with JS for 2 weeks by watching YouTube videos, you'd be kicked out faster than any sales person ever would. The reason you felt no threat was because you knew what you were doing,or at least knew good part of it. Sales people have one purpose in companies: to sell. There's nothing else. So if,after 2,3,6 months they can't do it, then of course nobody will ke…
There is massive difference between "the reality is for most sales jobs" and "if you get hired to position widely out of your ability".
What you describe is quite unusual exceptional situation. Not nearly reality of most programming jobs.
I know from a mathematical perspective this works in order to ensure that the company can be profitable at some point but a part of me wonders if it’s really necessary. I’ve never had a positive interaction with a sales person. But I’ve had countless positive interactions with customer support reps. One is over paid, the other under paid. If companies just created a sales team from their highest performing customer s…
The one place i workd with customer support people, they had a commission structure similar to sales, but based on retention. Is this not normal?
We used to have this. The retentions/QA team was under sales and would do a closed loop feedback system back. They were also paid commissions on 'saved' customers. Apart from retaining the revenue that would have gone otherwise, it was good way to fix some ongoing sales issues ( gaps in the pitch) and provide necessary feedback to the marketing on how to position the product.
Great article. This has real implications for SaaS pricing. e.g. If your market is SMBs, your JR AE sales person costs ~$50k/y with a reasonable expectation of selling 10x their salary in ARR, your pricing needs to be proportional to the number of customers in the top of your funnel / sales salary. It seems obvious, but often we think about price from a user and individual work perspective, with no sense of why it's…
Guessing a bit here— correct me if I'm wrong. This jargon is utterly foreign to me: SMB = Small to mid-sized business (not server message block) JR = Junior rep? Jr? AE = Account executive ARR = Annual recurring revenue
Like in any trade, I'm sure that the best are great at what they do, but I suspect I'm not alone in finding that the vast majority of my interactions have not been with a good sales person (and maybe by your definition not with good orgs either). I've never been told that I might be better off going elsewhere. Many times I've been told that whatever problem I describe, they can handle it, or my problem isn't what I t…
> But the reality is for most sales jobs, as a former colleague once told me, you're never more than 2 missed targets away from being let go. That sounds... fair? It’s like having a programmer that cannot program. If your job is literally to sell, and you’re not doing it? I guess it doesn’t have to be black and white as long as you bring in more than you cost though.
The difference is that the sale also depend in the customer. It’s like firing the programmer because a failed integration when he never got any docs or anyone answered any questions about the remote system.
If you'd walk into a lead dev position after only fiddling with JS for 2 weeks by watching YouTube videos, you'd be kicked out faster than any sales person ever would. The reason you felt no threat was because you knew what you were doing,or at least knew good part of it. Sales people have one purpose in companies: to sell. There's nothing else. So if,after 2,3,6 months they can't do it, then of course nobody will ke…
There is massive difference between "the reality is for most sales jobs" and "if you get hired to position widely out of your ability". What you describe is quite unusual exceptional situation. Not nearly reality of most programming jobs.
The problem is that a lot of people hired into sales positions shouldn't be allowed anywhere near it.. What I've seen: blatant lies in regulated industry with mandatory call recordings, refusal to do even the basic admin( I'm here to sell, not to fill in the info in the CRM system), fraud ( can't comment,as it's quite specific), lazyness ( watching YouTube/Facebook/Shopping while pretending your phone isn't working). The list goes on. Those people get fired. Normal people, who work, understand what they do and are willing to be trained or corrected if they do things incorrectly, are rarely,if ever, 2 paychecks away from being fired.
Don’t get me wrong I get that many companies do this and it’s the industry norm when it comes to enterprise sales but on average I think the incentive structure leads to a number of issues and sure there can be stand out sales folks that aren’t selling but really aligning with the customer, but can’t go based on exceptions, have to look at the average sales person to see what kind of an individual that incentive stru…
The problem, I think, is pricing. If you have a reasonably good way to charge bigger customers more automatically then you can go with a low touch sales process. If you don't (and virtually every product doesn't) you have to do value based pricing which pretty necessarily entails sales people.