S2 Ep. 1: Should Your Sales Team Sell Features Before They Exist?
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Hope Gurion: For B2B Product leaders the relationship with sales can be both challenging and rewarding. Both want to meet customer needs, but we’re not always aligned on which customers, which needs, and how best to meet them. In this episode of Fearless Product Leadership I asked 5 seasoned B2B product leaders a question that gets to the heart of many of these challenges and that is “Should your sales team sell features before they exist?”
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Welcome to the Fearless Product Leadership podcast. This is the show for new product leaders seeking to increase their confidence and competence. In every episode I ask experienced and thoughtful product leaders to share their strategies, and tactics that have helped them tackle a tough responsibility of the product leader role. I love helping emerging product leaders shorten their learning curves to expedite their professional success with great products, teams, and stakeholder relationships. I’m your host and CEO of Fearless Product, Hope Gurion.
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Sales and product working well together is critical for any B2B company seeking growth, and that’s pretty much all of them. However, incentives and scope of responsibility creates unavoidable friction. For example, Sales is focused on net new growth. Product is often balancing growth and customer retention. Sales may be organized by territory or customer segment, but product is balancing needs of multiple customer segments with varying contributions to top and bottom-line revenue, sales is buyer-facing.
Product is balancing needs of buyers and users. But one of the most divisive or aligning challenges for a product and sales team to navigate is whether sales should sell features before they exist. This can be a perfectly valid discovery method, or it can wreak havoc on product teams. In this episode we uncover strategies from 5 B2B product leaders on HOW to successfully work with sales to do right by the customer and company. In this episode you’ll learn:
How sales can play a key role in testing willingness to pay for a new product concept
How to work with sales in “promise management” and prioritization
How to align with your sales team in pre-product market fit phase with understanding, and validating unmet needs
Why you should never lie to sales
In the end I’m going to provide my 4 recommendations for how to partner with sales in product discovery and development fearlessly tackling the question “Should your sales team sell features before they exist?”
Ben Newell, VP of Product, CBRE | Host and formerly: rewardStyle and Sabre Corp
Margaret Jastrebski, Chief Growth Officer at table eleven, former SVP Enterprise Product, ShopRunner
Stefan Radullian - VP of Product & Engineering at Brainloop, a Diligent company
First Ben Newell shares his tips for working with sales during a new product development phase to test pricing, and willingness to pay.
Ben Newell: Obviously like most questions the answer is Yes and No, but I think we have had a tendency especially in corporate environments to kind of really say No on this and that's a really terrible thing if teams are trying to sell features before they exist. I don't know that I necessarily agree with that because I have found throughout my career that one of the best ways to validate whether something is worth it or not is to ask someone to pay for it.
We often in products spend time looking to see if someone would use something that we might give them for free or that we expose through our product in a test and would they use it. But becomes really challenging to figure out will they pay for it, and one of the only paths that you really have to be able to validate that is to use your sales team to your advantage.
Now there are a couple things I would say and one is make sure your sales team understands that that's what you're trying to do you're trying to gauge interest for these things you're trying to prove whether people will pay for it or not. We had a product that we felt had a lot of valuable data and that can't be unique in this day and age, I feel like every product manager has at one point or another said, “If it really comes down to it we're actually a data company.
So, we wanted to put that to the test to see if “Yeah I think this data is valuable and interesting and if somebody saw our report they'd go “Oh cool, that's interesting to me” but will they pay for it. To build a solution like that was quite complicated for us and we had to do a whole kind of data warehousing migration and spend time on that, and before we really got into it we wanted to validate whether that was true.
So, we put out a couple of initiatives and products, offerings for our clients that we felt we could execute quite easily either through, manual work and some reporting, but that would be valuable and representative of the final offering that we would provide. We asked our teams to go sell it, and we kind of set a threshold and said “all right if we reach this number then that means we're actually going to pursue this” and so that was helpful to set clear criteria about what was enough. It's not just one client we need you to sell it to you we need you to sell it to quite a few.
Now you know the jury's still out on whether or not it worked for us but we did find that there was not an overwhelming willingness to pay for it, and in fact it opened us up to some interesting competitive offerings that we were potentially not aware of and once we started telling our customers “hey we offer this” then it started showing up in other areas. So, I think when you look at your sales team I think talking to them about the fact that you want to validate whether someone will pay for this before you go build it is extremely valuable, so they understand.
That's what they're doing is gauging interest, and not necessarily going out and trying to get you committed to building these things but once you have that there's no better way to determine whether or not someone will pay for it.
Hope Gurion: Just as a follow-up to that how was the pricing determined in this sort of experimental stage, like willingness to pay how much? Was that up to the sales team to determine? Did you set a minimum? How did you sort of factor that into this experiment?
Ben Newell: We left the pricing with the sales team to say “What you do you think is reasonable to request of your clients based on the other pricing that we're putting in the market, and you have a good understanding of that?” However, in them setting the pricing they were also setting how much they would have to sell of it in order for it to payoff, in terms of the cost of building it.
So, I think having a shared understanding that like this is costly so you need to price it aggressively enough such that we don't have to sell every single client on this, in order for it have a positive ROI. If you think you could sell every client then great you can price it expensively but if you think you'd rather sign up for a tenth of our customers or a quarter of them then that means it’s going to have to be about this much to cover cost.
Hope Gurion: Next up Margaret Jastrebski shares how she’s worked with sales to validate whether there’s a market, and then how to contract with clients while solutions are still in development.
Margaret Jastrebski: I think the question “does your sales team sell features before they exist” is a really good one and controversial. I'm going to just say controversial in the product community because of I think the inherent danger. It might represent you know, you've got a sales team out in the wild that might or not might not might be as connected to the roadmap, and might or might not be connected to the technology or might or might not be as connected to what is in the realm of possibility.
They're out talking to people and coming up with a lot of concepts and really their incentive is to get somebody to sign a contract not necessarily to be happy on the other side of the contract, and deliver something full-fledged where the opportunities are needed etcetera so; a hundred percent controversial. I come from a background of B2B and I come from organizations oftentimes that are still trying to find that product market fit. In my experience a lot of times I actually really welcome sales selling, and I'm going to asterisk that because it does get dangerous, and does get tough.
I find that if you can create a really tight relationship with your sales team assuming that it's a smaller sales team within reason within scope, if you can create a really tight feedback loop and a really tight relationship with that sales team it actually becomes an extension of your product market fit research. It actually becomes they become an arm to you to go and test ideas, and market, and see. “Does this idea resonate? Does this thing it fit? Does this thing make sense?” Is this thing something that you will actually pay for and sign on the dotted line?”
Again, especially in B2B if you're working with the sales team you're trying to actually generate business and your procurement model is very, very different than what a B2B environment is. With B2B you’re couple clicks away and it’s normally kind of a scale opportunity. In the B2B order magnitude tends to be smaller, but each opportunity is larger, and the complexity of signing on the dotted line is more, so you have to get a lot of validation in the market.
So, I tend to lean towards being more open with a sales team and really hoping and allowing them to go… Again, it’s not my call they have their own team, but having them go out and talk to partners, and talk to opportunities and see if the idea that we're contemplating is the thing that resonates with somebody. I say that and I also think again kind of the requirement is just I have a really tight feedback loop with them.
I think it's really important to have them be well educated on your roadmap to have them be well educated on what you're doing. What you're thinking? Then also gives them some channels or some focus areas, like here a theme, there's X Y & Z can you go help me figure out if this is even something somebody's interested and willing to buy?
I know some of the things that we were looking at with ShopRunner and you know ShopRunner is an amazing company; it's at the marketplace it's got 150 retailers on one side, and millions of consumers on the other. It provides free two-day shipping for everybody that's part of that community and part of that network.
ShopRunner also has a really great digital wallet and so one of the things my team I was researching with were like “What if we started expand that digital wallet? What if we actually create some really interesting digital wallet functionalities to where now retailers who don't like to mess with their checkout page can just check a list and say oh wait I can just add Apple pay I can just add Chase Pay I can just add Venmo, it's just that easy.”
So, that was kind of the hypothesis that we were trying to validate, and my team and worked really closely with our sales team to go out and see like “Does this message resonate with people?” It was great and we got a lot of really great feedback and information to help us to which direction, or some of the direction that we wanted to go.
So, that's how I kind of think about sales, it's a big trust relationship, but I do think that if you think about it as market research then I think you can be really successful in that relationship.
Hope Gurion: Yes, it’s interesting I totally hear you on that, sort of testing the waters on concept to see whether there’s a need there, and whether it resonates. Putting a contract in place for something where there is barely a description of and there is not prototype for, and then all of a sudden like they have expectation. “Oh that’s not what I thought I was buying” like there’s a rule of engagement around that and it seems like you structured those relationships well.
Margaret Jastrebski: I probably could have talked about that a little bit more than I just did [laughter]. There are definitely some creative contacts that I’ve had to deal with. I no idea what this is that you just sold but I feel like there is a lot of bitching about that, myself included and I feel like I bitch about that a lot. I kind of want to articulate like if you can reframe you’re thinking and have that tight relationship I think it can be erased, and be part of the contract signing like you need to be part of the vetting of the contract. That is what Ronnie, Danny, and I always do and they would bring these opportunities and I would like “okay this, this, and this, not this, and not that there is just this, this, and this” and it worked really, really well because we were able to zero in really quickly on things.
Hope Gurion: It’s definitely something right like no product can go into a contract if there was any editing of the contract, like it was flagged through our contract administration team, and it had to come to us to see if it was unacceptable in any way. We don’t want to set up these false expectations and then set people up for disappointment because there’s the short-term “wow I signed a contract” and then a month later I’m dealing with the repercussions of like “What did you think you were getting? Who was going to do this for you?” Yes it’s an important check and balance.
Margaret Jastrebski: Hopefully you have a field of people who have answered that question with that.
Hope Gurion: Well this is the reality I want to get a variety of perspectives because it really depends on the trust and relationship frankly with the sales leadership.
Margaret Jastrebski: Well that’s all about can I have an honest conversation with the head of sales and be like “What the f*** did you just sell?” Then can that person come back to me and be like “Ops you’re right” I mean can you have that really good back-and-forth conversations and then if you can then you are in a good spot.
Hope Gurion: Next up Stefan Radullian describes the types of sellers you want to partner with when you’re developing a new set of features or new product. Stefan also shares his practical advice on navigating commitments when sales want to make a promise of something still in development.
Stefan Radullian: There are two types of sellers, actually three types of sellers. The ones that just sell the product as it exists, and then the second time type is the type of seller that sells features before we built them. So, they need product management to commit and promise that this particular feature is going to come at that date, and then they can make the deal which is difficult to manage.
Then there's just very few sellers that do vision selling and these are really good sellers, and it's still difficult to manage. What they do is they sell the product vision to somebody even though the technology is not there yet, and it maybe even obvious that that technology is not there yet, but they are selling what the product will become in one or two years.
I like the sellers who are selling features that exist today, and I like the guys who can sell the vision because that is actually very important for product management because that validates the vision. We still have the time and the flexibility and we can still be creative on how to realize that vision. Most difficult people or most difficult situations to manage are that the sellers that are selling features, two months or three months before we build them.
But still we need we need to manage that because we need the business we need this particular customer who is paying our bills and we need to find a way to commit and manage that. The way we manage it in our backlogs is to make it very, so we tag particular stories in our backlog and say, “That was promised to that particular customer or these two customers” and we try to plan around these stories and make them unmovable pieces in our backlog which is not simple.
Sometimes we have to make hard decisions and say “Okay we promise that but we can't keep our promises because for some business reasons we make more money with another customer when we have to promise something else” but it's really hard managing that and I don't like it, I don't like it .
Hope Gurion: Can anybody promise anything or what are your checks, and balances before a commitment is made or you commit to it in the user story that you try not to move?
Stefan Radullian: We try to avoid that every seller can sell any feature whenever he thinks he needs it for making the deal. In our company it's actually normal to ask product management about that “Can we promise that to the customer?” What I try to do is the due diligence and analyzes and refines the story, estimate whether the team get an indication of the costs, and put it into the plan and see what changes? How does that impact the plan? Then once I have that scenario I can then promise that feature.
I'm very I'm very precise with my wording when I'm talking to sales people. So, there are different types of how I can answer that I can answer “I commit this I will do this by that particular date” and then they know that they have a commitment, and they know that we will do really a lot to stick to that. I can tell them “this may come probably” but I don't commit and I'm very exact in my wording “I do not commit I do not promise to deliver that.”
They can still say they can still tell the customer product management is aware of the problem they try to find a solution, but it's very vague but that's a different way of how to put it and it’s black-and-white, either there's a promise or there is not.
Hope Gurion: Now Laura Marino shares why product has to focus on sales and customer retention, and a helpful story around aligning on customer needs.
Laura Marino: Yes, so I think that there has to be the right balance and I think to get to the right balance the best way to look at it is to look back and think about the customer. At the end of the day the customer has to become successful, it’s not just selling to the customer it's also making the customer happy after you have sold them.
So, sometimes sales may be too focused on closing the deal and they don't care about what happens next, but product absolutely cares about both, product wants more customers but also want to make sure that those customers are successful. So, if you come in with that mindset I think that there is a balance, there’s a balance at the head of product if you have a conversation with the sales team if they are saying “We really, really need to be able to promise this functionality because we're seeing that it's so important or this incredible customer really needs it” then you can come in, work with your team and say “Could we accommodate this?” If might not have been in the roadmap “Do we have any flexibility?” Or if it’s in the roadmap then maybe we can accelerate it a little bit so that by the time this customer really kind of starts deploying we have it. If you're able to do that then you're in more control and at the end of the day you're in a much better position to actually help sales close the deal, but also make sure that the customer is successful.
When things don't work is when you find that sales has already sort of made a promise, the deal is kind of being closed and now you find out that “oh but you need to do this” and if you cannot accommodate that in the roadmap because doing it would require not meeting other commitments. So, then what's going to happen is that you and your customer success team are going to be set for failure with that customer, so you need to start sort of having the conversations with the customer sooner of how you can convince them that maybe they can wait longer for that functionality, and it's not an ideal place to be.
The worst scenario is when the customer figures out after the fact that they were sold something that didn't exist and then they will turn, and you never really want to be there because it also creates this lack of confidence, and you want as a company, and as head of product you really need to build this trust with the customers.
So, one example that I had to deal with back when I was working for that was focusing on legal industry we decided to launch a product that was a product that was important for all legal companies. We had big competitors so we were definitely late to the, but we were very confident and understood a lot of what was wrong with the old versions of that product. We had a lot of big customers who really wanted to work with us so we set out to build this product.
The bar was high because we had to get to the minimum functionality that the competitors and then doing better. So, we were building really, really fast and we started getting some of those early adopters who trusted us and said, “Okay we will bet on you building the right thing and we will be your customer but you need to commit that you will be delivering on this things.” So, here we were essentially committing on delivering on things that were kind of in the roadmap but we did that very much jointly with sales, and product and it was painful because yes we had several of those customers and each one wanted commitments on slightly different things.
So, it really was a lot of work and we were managing things and the customers knew we were kind of not done with those things and we were committing to delivering them. It worked out we actually were very successful in displacing the, but I tell you it's not ideal it's really much nicer when you're kind of selling what’s already in the roadmap or what you already have. What I would say because I've seen this happen, and sometimes sales is too stuck on trying to sell futures, maybe because a competitor announced something, so you need to pull them back on what is great about your product today? Why they really need to focus on selling the value of the product today? So, that helps kind of the sales team also refocus and avoid this ongoing kind of always selling the future which is really not a place to be.
Hope Gurion: Finally, Troy Anderson talks about the importance of never lying to sales, and keeping aligned around reality.
Troy Anderson: So, one of the first things that tends to happen when [inaudible 0:22:41.8] but often at times, is there are a lot of commitments made on the roadmap, and those commitments are broken. So, one of the things that you really want to do is not to do that right, so you'd rather understand [inaudible 0:22:58.0] and so one of the first things I do in almost every [inaudible 0:23:03.6] has been to say no, and to say no to sentence, and that's really an important thing because until you've said “no you really can't say yes” and so you really can't have any priorities, and really can't follow kind of our rubric of how do we solve for our hypothesis until you've really said “we’ve got to the clear the decks.”
Until you’ve really cleared the decks or unless you do have a very good understanding of how your business works then I'm probably not joining your team but, likewise the key is to pause right, and you have to know that first. Likewise what’s broken and what’s not broken? What is really strong where we lead? It’s always difficult right, so obviously sales is the lifeblood of any company, and if sales isn't selling you’re of a job and there's no money coming in. Like how does that work you’re saying to yourselves? Well what I say yes to is we have an existing product those customers have already bought, otherwise we don’t.
And you might ask usually to continue selling what we have and not to sell the future because the thing that I wanted do is I want to give certainty about that future [inaudible 0:24:20.9], but what I find is that companies I join the roadmap is for breaking promises, and that’s philosophy and you earned it. So, the first thing you do typically is I stop that promise, we’re not going to [inaudible 0:24:37.0] anything we said.
It's extremely unpopular but I can tell you salespeople do not want to be lied to it’s just there on your team, they need to know what reality is and until you can give proper rounded sense of reality it's much, much better to pause because otherwise you're over your [inaudible 0:25:02.1]. I'm saying you personally in an organization; you don't exactly know what is going on, so your job is to observe but also to understand. But once you get to that point of really understanding what you're trying to solve then you can go back to say “okay where going to do this” and directionally we're going to go there but yeah we have to say no at first.
Hope Gurion: I’ve been fortunate enough to work with thousands of sales people in my career, and have worked with them across hundreds of customer needs, promises, features, and products, and over that time I’ve learn the best ways to navigate the best ways to understand our customer’s needs, and present solution concepts to potentially solve those needs.
I’ve also learned how important it is to leave room and flexibility for product teams to continue to iterate on the solutions to find the ones that work and scale. When working with sales and product teams at companies and considering new products to bring to market or new features to solve customer needs I have found 4 key things are really critical for the sales, leadership, and product leadership to work really well together. So, I’m going to break these down into 4 recommendations, and so the first is:
Discover together—are sales and product discovering customers’ unmet needs together in interviews, sales calls, demos, and are they accurately capturing them to have a shared point of view for what will ultimately become part of the product roadmap?
Sell the solved problem, not the feature—several of the leaders shared this perspective working with sales to understand the importance of the solved problem to a customer, and their willingness to pay for that solved problem is a critical part of the discovery. If customers are willing to pay and are demonstrating that they actively are trying to solve the problem and do it in ways that they are really dissatisfied with this insight can be a leading indicator that will help make your future sales much easier. It also gives us a glimmer into what sort of adoption behavior we’ll need to achieve when we are actually delivering a solution to their problem, and knowing how the customer will know and prove to themselves that the problem is solved gives a preview to the product team of what they need to pay attention to in how the product becomes an experience. That will enable them to set up ways to measure both the happy and non-happy paths of customer adoption.
Pilot first, scale sales next—I’m going to expose the virtues of a pilot for a few minutes for the uninitiated. The magic of a product pilot is that both the sales and product teams experience critically important validation signals throughout a structured discovery process. If you haven’t led a new product pilot, I’ll include some reference links in the show notes. But here are the 3 key takeaways:
1. First, customers who raise their hands for the pilot validate that they have a problem they’re willing to pay to solve. This is critical signal for sales and product to see which customer segment and how much they’re willing to pay yet you can still be demoing prototypes.
2. Second, the customers benefit because they will be influential in the solution’s development but because you have multiple pilot customers, possibly representing unique market segments, it helps avoid building custom software and helps you both see the pattern in which needs and capabilities matter to which customer segments.
3. Third, both the sales and product teams learn how well the solution solves the problem because the customer pays to continue using the solution after they’ve trialed it. If after they’ve trialed it, they’re not raising their hands to continue using it, perhaps they’re not the right customer or you’ve got more work to do with your product solution before scaling sales.
4. Co-presenting the roadmap—when sharing plans for future product development in quarterly reviews, are we aligned in presenting what is worthy of investment or ok to defer based on our shared goals? If we’re not presenting together, we’re not aligned on our priorities and path to achieving them. So, get aligned with your sales leader what is critically important for new customer growth and customer retention.
If you’re a product leader feeling out of balance with your sales leadership, I’d love to be of help. Contact me on Linkedin or Twitter or schedule an initial consultation with me using the contact page at Fearless-Product.com.
Some of my favorite resource articles for running effective product pilots:
Charter Customer Programs (SVPG) + The power of reference customers
Customer Development with Participatory Roadmaps | Christine Wodtke
Why Pilot Projects Should Include a Conditional Purchase in B2B
Feedback is a gift! Share what was most useful to you by leaving a review. Have a question suggestion for a future episode? Contact me on Linkedin, Twitter or at https://www.fearless-product.com/contact.