Why sell to small-to-midsize businesses at all?

After all, everyone wants to hunt the big game and land big deals, and there’s no getting around the fact that an SMB deal will be smaller. Plus, there are plenty of small businesses that will be small forever or won’t even survive. They’re poor prospects for a recurring business model.

All those arguments are solid. But they also miss the point.

A large portion of American tech workers is employed by small businesses. SMBs account for 54% of US sales. And even where they’re just a single person, it’s a mistake to think of them as mom-and-pop outfits that aren’t interested in the future: SMBs account for 24% of new patents, and their interest in (and reliance on) tech is growing.

Plenty of small businesses aren’t planning on staying small. In 1998, Google was running on $100,000 in seed money. Yes, the vast majority of SMBs aren’t destined for Google-like success. But SMBs are among the fastest-growing businesses. If your offering scales well for the buyer, SMBs could represent a revenue source that grows itself.

SMBs are interested in tech because they know it can help them grow their business, even where they don’t know much about it. And they’re a valuable market to sell to.

But to succeed, an SMB sales strategy requires a different approach than the enterprise-appropriate methods we’re accustomed to.

Find SMB, Enterprise, and B2B Leads at Scale

Whether you’re looking to connect with your first SMB customer or are targeting enterprise clients, sales teams rely on a steady stream of incoming leads. So, before we get to our tips for SMB sales, let’s address one of the biggest challenges facing all types of sales: generating qualified leads.

The majority of marketing and sales teams name lead gen as their top challenge, but you can use the Datanyze Chrome extension to streamline your prospecting and lead generation efforts.

Datanyze makes it simple to find and connect with leads without leaving your browser. You can search by job title, industry, or company and Datanyze will provide you with up-to-date contact information, including email addresses, direct-dial phone numbers, and mobile numbers.

Want to see how easy generating leads can be? Try Datanyze today (and get 10 free credits on us!).

What is SMB SaaS?

Before we dive into how to sell to SMB companies, it’s important to define what SMB SaaS (software as a service) providers are. An SMB SaaS company is focused on selling software to small to midsize businesses. SMB is broadly defined to cover companies with employees under 500.  

The associated revenues vary but fall somewhere under $100 million. That means that SMB SaaS companies are selling into a highly fragmented market. According to the U.S. census, there are about 19,464 enterprises with greater than 500 employees compared to 30.2 million SMBs. 

The needs of a small business are different from the enterprise market as well. SMBs will search for products designed to deliver immediate customer impact with minimal effort from customer success managers. This means SMB SaaS companies must utilize low-touch marketing and sales models that can accommodate the competitive pricing and withstand the higher gross customer churn expected of SMB customers.  

Now that we’ve defined the SMB SaaS business, here are five key ways that you’ll need to sell differently if you’re selling to SMBs.

How to Sell SaaS to SMBs: What You Should Do Differently from Enterprise Sales

How to Sell SaaS to SMBs: What You Should Do Differently from Enterprise Sales

1. Address Different Pain Points: Help SMBs Overcome Hurdles to Growth

Survival, success, and repeatable business processes are major SMB concerns.

SMBs are facing different threats and seeking different rewards compared to enterprise buyers. That’s partly because they’re working with smaller budgets. But they’re also usually working to achieve enterprise-level business processes.

Growth is a pain point for SMBs. Where larger enterprises see growth as a strategic aim to be weighed against other strategic concerns, for an SMB, growth is the strategy. If they don’t grow, they won’t survive. The business owner who’s running the whole operation out of her personal bank account or building on very limited financial support from family and friends isn’t unusual. So growth is a personal pain point for these founder-CEOs.

The flipside of that is that they’re not constrained by a desire to be seen as saving money. Enterprise sales often stall when a group of decision-makers and stakeholders can’t see the benefit clearly, but the cost is staring them in the face. When that happens, says Challenger Sale author Brent Adamson, enterprises often default to one basic behavior: “What’s the one thing we can all agree on? ‘Well, let’s try to save the company a buck,’ right?”

Early-stage startups or SMBs struggling to grow to the next level are often caught between trying to keep their heads above water financially and seeking the business process transformations that will propel them forward. So they’re actually less concerned with budget than larger organizations, and more likely to see spending on business process improvement, like lead generation, as an investment. But the reward has to be apparent and relatively rapid.

2. Offer Different Business Benefits by Shortening Time-to-Value

Benefits that appeal to corporate or enterprise clients don’t always mean much to SMBs. 

Many SMBs are seeking to get themselves into the position your enterprise clients are in already. Enterprises are often chiefly concerned with multi-year projects aimed at major leaps in market share or revenue, or at internal alterations to fit the changing business environment. SMBs are concerned with repeatability and profitability, and their benefits can’t come five years down the line. They need to show up a lot quicker than that.

That means your offering’s time-to-value and its benefits and features can be smaller and lighter. For SMBs, time-to-value is a dealbreaker. Corporate sales teams overwhelmingly use huge, powerful sales tools like Salesforce, which had close to two thousand $1 million customers in 2019.

By comparison, around 32% of American businesses — most of them relatively small — are still using Windows XP. Why? Because they know how to use it. When the owner, CEO, office manager, IT staff, and sales team are all the same person, anything that takes time and doesn’t pay right away is never going to make it to the top of the to-do list. So the benefits of your offering need to be presented to SMB customers in a way that shows how they can get value out of it right now.

In a way, this is similar to the requirements of consumer-facing products — time to value is a key metric for consumer mobile app designers, for example. But that value is subjective. SMB owners aren’t looking for pleasure and enjoyment (would you use XP if you were?) they’re looking for a step up in their business. Deliver that, without taking extra time, and they’re all ears.  

3. Align with a Different Buyer Process: SMB Sales Cycles Are Shorter and Less Defined

The buying process in SMBs is a lot shorter, less well-defined, and less content-intensive.

The typical enterprise client has a well-defined buying process. You can mesh with it to create the best results. But many SMBs have no well-defined internal processes at all. That doesn’t mean they don’t have a process by which they buy, just that it’s unstructured. Instead of being defined by prearranged processes and access to diverse professional skills, it’s defined by personal trust.

The good news is that selling to SMBs can be far faster than selling to enterprises, and it offers a greater range of action for the salesperson. We’ve had to get used to an environment in which the majority of the buying journey — 60% to 80% — is complete before you get on board.  

Content takes the place of the educating salesperson: 47% of buyers will look at three to five pieces of content (enterprise-level business buyers overwhelmingly prefer whitepapers) before making a purchase decision. However, compared to enterprise decision-makers, SMB buyers are less self-educating because they don’t have the time or professional capacity: Most SMBs that offer mechanical services have a mechanic at the wheel, not a business graduate.

This has implications for digital and content: search and review sites are far more important for SMB sales than content — and social selling will often falter at the first hurdle, failing to locate any active profiles that are business-oriented. It also has implications for constructing a selling process for SMBs, which must be adaptable and maintain a personal and educational approach. It can’t assume pre-existing knowledge and it has to allow for a fast sales cycle.  

4. Sell to Different Decision Makers: Appeal to CEOs and Business Owners

Decision-makers are fewer in number, have more authority, and have different concerns — because there’s little distance between them and the business.

Selling to enterprises in the age of consensus means that even when you’re near the wire with a prospect, you still have several more people to convince. They’ll be a mix of professionals at different levels in the company, different areas of expertise, and with different concerns. Each of them has to be approached differently, and the benefits of your offering have to be explained in 5.4 different languages: selling to a CIO is very different than pitching to an accountant or a CEO.

Selling to SMBs often involves a single decision-maker. If you’re on the phone with Bob’s Flowers, the odds are good that the lone decision-maker will be Bob. And he might buy right now. There’s no one to consult, and no ‘budget’ — he either has the money or he doesn’t. If he thinks your offering might work out for him, he’ll tell you so. (If he doesn’t, he’ll likely tell you that too. Expect hard nos or yesses in the SMB sale.)

Ninety-eight percent of tech purchase decisions in SMBs are made by the CEO. The other 2% are delegated to someone the owner/CEO trusts. Whoever you have on the phone is either taking a message, or they’re the buyer.  

5. Do More with Less: Lean into Cold Calling and Emailing

Compared to enterprise sales, there are fewer prospecting tools and a lot less data available for SMBs, and it’s often found in different places.

Favorite prospecting tools and methods are going to leave you dead in the water for SMB sales if you rely on them to work like they would for enterprise sales. SMB buyers often aren’t even on the same networks, because they don’t see the benefit. They’re on Facebook (86%), Instagram (48%), YouTube (46%), and Twitter (44%). And while SMBs haven’t historically been a major presence on LinkedIn, almost a third of them (31%) do have LinkedIn pages these days.

So, how do you prospect and contact SMB buyers?

By going back to the basics. Email and phone calls. Explore the modern ways of how to find anyone’s phone number and other contact details.

Looking for an email address or phone number? A Whois search for their website often reveals the name and email address of the owner. Phone calls can be the best first approach, unlike when you’re dealing with enterprise buyers who live in their inbox.

Looking for contact information through LinkedIn? Use Datanyze to fast-track your search and quickly find validated email addresses and phone numbers for SMB buyers.

datanyze contact information card

Looking for information on the business owner? Consider checking out the review sites and forums that SMB owners and CEOs use to judge each other. Learn what you can about priorities, attitudes, knowledge, and temperament from forum posts and comments.

When it comes to the later stages of the sale, it’s important to remember that SMBs need personal nurturing. These sales are often multi-touch because they’re about personal trust and making it to the top of the to-do list. So be persistent and offer value. Remember that SMB owner/CEOs often have little time and little knowledge outside of what they do, so offer collateral that’s digestible and upfront but educational.  

Selling SaaS to Enterprise: 5 Tips to Keep in Mind

While selling to enterprise deserves its own post, some of the highlights to selling to larger, more sophisticated organizations are as follows:

  • Focus on ROI: Get rid of your fluffy sales pitch. Impromptu purchases are rare in the enterprise field, so you need to keep things simple and focus on providing a proposal that supports the argument that your service will make them money in a clearly definable fashion.
  • Case Studies Speak Volumes: Has another, similarly sized business found success with your service? Share them, but make sure they contain specific, quantifiable claims.
  • Personalize Your Approach for the Right Decision Maker: It is said that, on average, six people are involved in an enterprise purchase decision. Ensure that you don’t waste your time talking to the wrong person. Research the company, then find the right contact’s info using the Datanyze Google Chrome Extension. Make sure that your value prop is unique to that person’s specialization.
  • Don’t Lose Track of Your Leads: With so many individuals and touchpoints involved in a purchasing decision, be sure to keep detailed notes in your CRM. Never lose the plot!

SMBs Sales Requires a Different Type of Solution

SMBs require a different approach than enterprise companies, one that reflects the priorities of SMB owners and CEOs. They’re chiefly concerned with stability and profitability and often have little business or tech knowledge. But they’re ready to spend if they can see the benefits. 

Plus, the sales cycles are short and relatively simple: nurturing in the lead stage may require persistence but few SMB sales fall through because of an unexpected objection from the CIO or a budget reallocation.

SMBs aren’t just “enterprises-but-smaller.” You’ll find different requirements, structures, and processes. However, if you can approach them the right way, SMBs can represent a valuable source of sales and revenue.

Start Generating SMB Leads Within Minutes

Are you ready to tap into the SMB market? There’s an easy way to get started and generate SMB leads for your sales team at scale. You can use Datanyze to find and connect with high-value SMB prospects right from your browser.

Start your free trial today and begin generating hot SMB leads right away.