How do you Find Enterprise Product/Market fit? [Mind the Product]

It’s never easy to create enterprise-grade products. They are inherently expensive. You need them to meet exacting standards, and you also need a very convincing story as to why any enterprise should buy into your product. Enterprises are large, slow-moving machines, so even a seemingly small change can involve a lot of hours and money spent, not only on the product, but on set-up and training.

Such challenges mean that sales, marketing, and product are tightly coupled in an enterprise product. For example, decisions like whether it is self-serve or on-premise, have to be kept in mind as you engineer the product. The product interface, user experience, or features need to be aligned with your customer and go-to-market strategy, making your go-to-market plan an integral part of the product/market fit discovery process.

Here are some important considerations to keep in mind as you discover the product/market fit in an enterprise:

Enterprises Move Slowly

The first impression that you get when working with enterprises is that they are seriously behind the times. There is some truth in this impression, as enterprises don’t adopt modern frameworks or design patterns rapidly. But successful enterprises are where they are because they have built many successful lines of business, and this means they are risk averse and interested in protecting the status quo. Appreciating this difference in perspective will allow you to engage better with enterprise businesses, and navigate the challenges you will face when selling or onboarding them.

For example, enterprises will combat the risk in choosing new software by involving as many people as they can in the purchasing decision, so that the risk is spread out over multiple people.

Enterprises Have Several Stakeholders

It’s obviously very important to think about your user and how your product helps them, but in the case of enterprise software, who are you actually “selling” to? Most often, the person in charge of the purchasing decision is not the user, so when considering your market, you need to think about the purchaser and their preferences.

An enterprise-level CRM app isn’t bought by the customer relations or sales teams who will use it, but by a head of department or general manager. Your product/market fit is about selling that “quarter inch hole” to the person who needs their team to drill them.

The enterprise goals will differ depending on the customer, type of market, and department you’re aiming at, but they might include:

• A tangible return on investment.
• Low friction to implement.
• Ease of use.
• System continuity over time – no excessive bug problems.
• Streamlining of current processes.

Asking the right questions early on in your sales process can help you to work out the best strategy. For example, ask questions such as: “How would you make the business case to your boss to pay for it?” You can understand the motivation driving these users when you hear them say: “This is how I’d make the business case: we have this pain and this is how your product will help me with this pain.” And the business case would be, “right now we are spending this much money doing this. And if we have your product, or one like it, we can save this much money”.

In an enterprise setting, you also need to consider the motivation of the buyer or decision maker. It might, for example, be a path to promotion. And they certainly want to look good in front of their bosses. Supporting them and providing them with information that can help them build the case for your product will come in handy.

In all cases, you should identify and calculate the value you deliver, in as close to real time as possible, and as close to the usage as possible. In the beginning it’s likely to be less accurate, so share it on-demand with customers, but as you continue to get better at it, start showing it directly on a customer dashboard.

Go-to-Market Approach

The go-to-market approach for an enterprise startup could be top-down or bottom-up, sometimes even a sandwich strategy: it all depends on the product.

Top-down looks at reaching key decision makers, and when you use a top-down approach, you may want to look at getting to 10, 20, or 50 customers to see initial signs of product/market fit. The way you look at product/market fit in a bottom-up approach is very different – it looks at reaching the actual consumers of the product within an enterprise, and you have to start looking at getting to thousands of them before you start seeing signs of product/market fit. A bottom-up approach may need your product to be pretty much self-serve.

Keep in mind the following:

• Value Fit: The product delivers significant net value for a use case
• Purchaser Fit: There is an identified organisational purchaser
• Distribution Fit: There is a cost-effective distribution channel

It is a good practice to build relationships with the different teams and functions involved in the decision making. Decisions are made by people, and people don’t always act rationally. You may be able to use this to your advantage by building the right relationships, or it may blindside you and cause a deal to blow up if you don’t have the correct understanding of the people involved in the system. Keep in mind that people often change jobs, and you do not want to be left out in the cold if your contact in a particular department has moved on. It helps to build relationships with more than one contact in a department.

Whichever approach you take, you are able to define a go-to-market approach when you have a repeatable way to go and find customers over and over again.

“Enterprise Ready” Features

There are certain features that enterprise products need to have by default. Analytics, dashboards, or user / team permissions are some of the non-sexy stuff that you will need to have to sign up customers in an enterprise setting. Because enterprises have complex organisational structures, they need complex permission controls to match. They often have requirements to meet certain security and compliance parameters. These are the first features that will signal to enterprise buyers that a startup’s product is ready for enterprise adoption.

In addition to security concerns playing a role in the contract, service-level agreements (SLAs) will be taken very seriously. When you have 100 separate SMB customers, intermittent product downtime likely won’t make or break a deal. But when a large company has invested heavily in your solution, you need to be ready to support the necessary scale to ensure your product isn’t constantly going down. That means a highly customisable offering that can be tailored to match the exact needs of each particular customer.

On Asana’s enterprise landing page, for example, the importance of security is shown in the context of compliance: “The security your organization needs”.  Asana describes administration and security controls as “often required”, again emphasizing compliance.

For example, one of the things that we ran into my own venture when we were building knowledge management solutions was that enterprises need to move our product to their domain. Without this they could not really use it across the organisation.

I suggest you take a look at EnterpriseReady.io. It’s a collection of resources that help SaaS product founders looking to increase adoption by enterprise customers. It has identified 11 features an application must have to be adopted broadly by large clients. It is a great reckoner for those venturing into the enterprise space:

• Product Assortment: Different versions of a product to meet differing needs
• Single Sign On: Enable enterprises to manage users from a single, central directory
• Audit Logs: Provide admins with a detailed trail of account activity
• Role-Based Access Control: Allow for the separation of privileges by user role
• Change Management: Empower admins with tools to roll out features/product changes
• Product Security: Demonstrable application security through best practices
• Deployment Options: Data security + application overhead + flexible deployment
• Team Management: Centrally managed collaboration with coworkers is a must
• Integrations: Enable data portability by allowing data in and out of your app
• Reporting and Analytics: Allow admins to demonstrate value gained from your app
• SLA and Support: Big businesses are less forgiving than beta customers

Rinse and Repeat

In your product/market fit journey, you are normally try to discover the market (or problem) and the correct product (solution). In an enterprise setting, your go-to-market approach adds another variable to this problem. So when something is not working, you need to ponder whether it is a sales problem or a product problem, and therefore which levers you pull to self-correct. It is important that you don’t change multiple variables as you self-correct.

You have to enable the people inside large enterprises to spread the product horizontally and sell it up through the organisation. This often means building resources and messaging that allow an internal champion to communicate effectively with other parts of their organisation.

You should experiment with different messaging, pitches, and tactics, and always be asking what isn’t working. Try a wide range of outreach approaches, such as talking to different stakeholders or industries, or different messaging to see where you get the most enterprise traction. When you see a clear pattern emerge, double down on what’s working.

Conclusion

For consumer companies, often when the holy grail of product/market fit is achieved, the company takes off. Enterprise B2B companies face a different challenge. Sometimes, despite achieving product/market fit (and knowing when you’ve achieved it), and winning your first cohorts of renewing customers, growth remains a challenge. You will find several enterprise B2B companies who built outstanding products, won outstanding initial sets of customers, and then ultimately failed to scale. The problem here usually lies with their go-to-market approach.

And just like with product/market fit, finding go-to-market fit is a process, not magic. Every go-to-market strategy should be unique to the company and its product. The product/market sales fit journey is an iterative process, and the result of finding this fitness is having customers pull you in during the sales process and a one-page playbook for repeatable sales success.

The post How do you Find Enterprise Product/Market fit? appeared first on Mind the Product.

Source: Mind the Product https://www.mindtheproduct.com/2019/07/how-do-you-find-enterprise-product-market-fit/