Podcast | 40 minutes Listen

Markets are crowded and the gold rush is over. Now what?

The age of information asymmetry is over. Buyers are doing more research on the front end and entering sales conversations more educated than ever before. Obfuscation and heavy discounting is a recipe for a disastrous business/revenue model. Whereas companies focused on transparency and having a solid pricing plan are finding more success. 

“In the world of human psychology, it's a lot easier to understand BS.

In this Future of Sales podcast, Patrick Campbell, Co-founder/CEO of ProfitWell, uses his company’s background in data analytics to share some surprising stats about sales, including the truth behind heavy discounting. Patrick also goes back and forth with our host on quotas - is calling them “good” or “bad” too binary?

Listen and decide for yourself.

The “No Bullshit” Takeaways:

  • Learn why heavy discounting is a recipe for disaster. 

  • Understand how the access to information is balancing the scales between buyers and sellers. 

  • Discover why Patrick thinks the profession is shifting to be more customer-centric.

 

If you prefer to watch, here's the full video version of the episode

 

 


TRANSCRIPT

[00:00:15]

Sahil Mansuri: Hello and welcome to another episode of The Future of Sales. I’m your host, Sahil Mansuri, CEO of Bravado. And with me today is a familiar face to many in the world of SaaS and businesses and sales, Patrick Campbell, co-founder and CEO of ProfitWell, formerly Price Intelligently. What up, man, thanks for joining us.

[00:00:38]

Patrick Campbell: Yeah, thanks for having me. I’m super excited. I don’t always get to sound off on sales and things like that, so I’m excited to go deep on something I really don’t talk about.

[00:00:46]

Sahil: There you go. And I think, you know, for the benefit of our viewers and our listeners, perhaps you could just give a little background on what ProfitWell is and what you guys do, which I think will be a good framing for our conversation today.

[00:01:00]

Patrick: Yeah, absolutely, and kind of back of the baseball card stats, we’re about a 50-person company here in Boston, fully bootstrapped, it’s kind of like a fun little fact. And our core product is a free subscription financial metrics. So, you plug in, you’re brain freeze, trying Zora, whatever you’re using. Basically, get free access to your MRR, you churn all those important numbers. And then, we sell products that basically help move important numbers in ProfitWell. So, we sell a product called Retain that basically takes care of your mechanical or delinquent churn. We sell a product called Price Intelligently, which is actually the first product. This is on, you know, helping you with your pricing. We sell a couple of other things, but the whole model is all about subscription companies. And at this point, we actually have about 25% of the market using one or more of our products, so we’re pretty pumped to having this nice little center, one of the centers of the subscription universe just because we can learn so much.

[00:02:00]

Sahil: That’s right. And, you know, pricing is one of the core, I guess, foundational skill sets that you learn as a salesperson and you see wildly different tactics that are used by different companies, by different sales managers, by different sales reps and, you know, I’ve worked at organizations that, you know, where let’s say that the baseline, like sticker price for a piece of software is $10,000. So, it’s an annual subscription of $10,000. And come the last week of the month, that number can vary wildly. On the last day of the month, that number can really vary wildly. We’re, you know, we’re selling deals that are, you know, 70%, 80%, 90% off of the list price just because there’s some number that we need to hit or just because there’s some goal that’s in front of the team or whatnot.

And we have had a number of, you know, guess on the show to talk about the concept of quotas and how all of that affects, you know, the mechanic around buyers and sellers and the lack of trust around of salespeople because of pushiness and there’s a lot to unpack here, but I think where I want to start because you sit on a mountain of data that I have never had access to, so let me take advantage here.

[00:03:34]

Patrick: Yeah, yeah, and you won’t because it’s very crowded, so. Yeah, yeah, yeah.

[00:03:39]

Sahil: That’s right, that’s right. But you have trends that you have access to. And specifically for that, I’d love to hear, you know, what do you see in the market as far as, you know, the way that sales teams and companies price their products and discounting and whatnot, I think that’s really an interesting topic.

[00:03:59]

Patrick: Yeah, I think, there’s a couple of places where we can start and I think starting on a kind of like a nice tactical little bit of myth-busting is probably the best place. So, what’s really interesting is we did a study and we published this a little while ago and I can share it maybe for the show notes, but we basically looked at companies that hit their goals, their quarterly quotas and separated them into two groups, one group that did really, really low discounting, so like minimal, like loyalty discounts, hey, here’s 5% or, hey, you’re just a couple of percent, because we’re buddies or because I’ll get you over the line on the last day of the month.

And then, we also looked at companies that were aggressive with discounts. And what we notice is that when you looked at the trend over a quarter, basically the folks doing minimal discounts was very incremental, meaning, they were adding revenue every single day. Basically, was just kind of going up into the ride every day, there weren’t huge spikes, there weren’t huge craters, it was just very, very focused. And then, when we look at the companies that we were doing aggressive discounts, basically the quota was trending flat if not really low until kind of mid-quarter or so and all of a sudden, you saw this huge swing whether it’s a huge growth rate in the second half of the quarter and they hit their goal, right, and they actually beat the people who did slower discounts.

Now, you look at that data and clearly there’s a difference, clearly, there are heavy discounters, there’s a lot of things going on in that sales team. But when we actually study some of the lurking variables with those two groups, what we found is that those companies that have the incremental very low, low discount but still hit their goal - churn rates were basically nothing, like churn was very, very low. The kind of happiness or NPS scores were very, very high. The actual like ARPU was actually going up, meaning their pricing was really, really good. And then, when you looked at the numbers for the aggressive discounters, it was basically everything was the opposite, right?

"What we found is that those companies that have the incremental very low, low discount but still hit their goal - churn rates were basically nothing."

And so, to kind of sort of things off, I think the big thing is is that really good sales teams, they understand their customers on a really, really good level or they’re able to understand their customers throughout the sales process. What that allows them to do is just sell in a really intelligent way versus folks who were just kind of throwing stuff up against the wall just trying to send a thousand emails to get 10 responses and trying to discount to all hell, you know, in a hand baskets towards the end of the quarter, those folks are just saying I have a company for -- not complete failure but for a lot of failure. So, that’s kind of some interesting to kind of keep things off to kind of summarize that. What we found is that there were customers who received over a 30% discount. I think it was actually closer to 25%.

Their willingness to pay for the product dropped by actually 50% to 75% at renewal, so basically, we weren’t able to defend the value and the churn rates of those customers weren’t the same. And so, it’s just kind of showing you that basically if you’re discounting over 25%, 30%, you’re just not selling to the right customers. And inevitably what ends up happening is those customers just -- they weren’t ready, they should have waited another few months to really understand the product or got a little longer sales cycle.

[00:07:11]

Sahil: So, okay, so, first of all, that data that you just shared is intuitively completely unsurprising, right? Which to say that as a salesperson you know that the great -- most commonly, the reason that you’re discounting is because a buyer isn’t ready to make a purchase or is not convinced of the value. So, you’re using money as a hook in order to get them to accelerated decision or to make a purchasing decision entirely. And the problem with that is many fold, but where it really comes back down to is payback period, which is to say that in SaaS, you know, it’s very different from selling a car where a person walks onto a lot. You sell them the vehicle, if they buy vehicle and they drive off the lot, they’re gone, right. I mean, no returning, you can’t bring the car back.

And if a year later or three months later, that person is dissatisfied with their purchase, well, too bad. I mean you bought it, it’s done. All sales are final. And that is definitely not the case in SaaS, right, and the vast majority of sales people that we interact with, I think, you know, both your company and mine is in SaaS business and their -- the payback period can be three years or four years like you need to retain customers for a very long period of time in order to be able to continue to raise venture funding, which we’ll dive into in just a bit because you’ve got a unique perspective on that. In order to be able to continue to raise venture funding, it’s not enough to just show top-line growth, you know, the days of Groupon and Box and Zenefits and companies like that who basically just piled humans and piled, you know, top line revenue growth and then -- and said, oh, one day, we’ll figure out how to make a profit. Those days are gone.

Now, VCs are much conscientious about retention and about churn and about payback period and about ARPU, which you mentioned - which is Average Revenue Per User - which is a metric of, you know, how much revenue are you getting from person who’s using your product, which is a really gauge of how well you’re pricing. I know you’ve got -- you’ve got a very different world today than we used to have. So, why haven’t sales teams caught up to the fact that coercing a buyer to buy by offering a heavy discount when you yourself are unconvinced if the buyer is going to get value, let alone the buyer being convinced to get value. It’s a recipe for just high churn and a disastrous financial model because you’re just losing money on that deal.

[00:09:51]

Patrick: Yeah. I think the -- so I do think sales is catching up. You have, you know, products like yours, obviously that help, you know, certain things like that and then, you have, you know, this whole conversational marketing revolution and you have all these kind of stuff that’s kind of helping sales teams be better. Now, some of that is aspirational meaning, hey, we know this is great for top sales teams but they’re still not using these products and the reason they’re not is typically two-fold: One - a lot of these tactics work, right. So, if I’m trying to basically, be a use car salesman when it comes to SaaS and subscriptions and I love kind of the example that you gave because this is the first business model, the subscription model where the relationship is baked right into revenue.

So, if that user doesn’t like you anymore, you know, they’re going to turn and they’re not going to, you know, come back, right? But I think what ends up happening is a lot of businesses this still works because enough people will basically like the product and upgrade and so those people who thought the product was terrible and the experience was terrible, they’ll just move on and there are enough people to sit into the funnel. But I think that those times are basically waning, so basically you’re seeing this world where most of the markets that we’re going into because they’re crowded, because it’s harder and harder to acquire customers there’s no more gold rush, exactly like you’re talking about.

"Because it’s harder and harder to acquire customers there’s no more gold rush."

And so, we’re kind of in that transition period and the other thing that really is causing people to change is that for the first time and a lot of businesses and this is terrible to say because this should have been happening for a decade, but for the first time we have to end-to-end analytics in a lot of our businesses. You would be amazed at the number of companies that we still talk to that you talk to them about, well, what’s the retention by channel, meaning, someone that came in through Facebook or someone came in through SEO, they don’t have an answer to that question and they’re a hundred million dollar company, right? And they’ve spent a ton of money, they’ve raised this amount of cash, they’ve really done things in very blunt force way. And now, it’s easier and easier to really track those things and so we can realize in the context of that pressure what we need to do and what we can actually fix.

[00:12:06]

Sahil: I really like the emphasis on analytics there because companies are becoming increasingly more savvy, you know, we kind of call it the Moneyball revolution, right, where people are starting to wake up to the fact that, hey, all these numbers make sense. And just as a point on Moneyball, by the way, I was reading an article just this morning on -- yeah, I can’t remember if it was "The Athletic" or it was one of these player’s tribunes or something like that, about Albert Pujols. And so, as a young baseball fan growing up, I kind of grew up admiring Albert Pujols. I’m a Giants fan. You know, he was a cardinal, so like there’s a natural discourse there, but he was just so good.

[00:12:50]

Patrick: Yeah.

[00:12:51]

Sahil: He was like the most consistent hitter of all time and he basically this year’s adding 250 and he went on record to say, “Well, the only reason I’m adding 250 instead of my career average of 300 is because 50 points worth of hits are being taken away by the defensive shift. And so they’ve realized that Albert Pujols is incredible at hitting the ball hard up the middle, and so they’ve taken the second basemen and they’ve stuck him basically right over second base but 20 feet pass the infield. And nay shot, he hits right past the pitcher --

[00:13:27]

Patrick: It’s going to get caught.

[00:13:28]

Sahil: Basically, the second basemen, he either catches or fields and throws the first, and, you know, that used to be a guaranteed base, if you ever hit the ball on your second base, you know, that shouldn’t stop at the second base, but always have a gap there. But for Pujols, he doesn’t leave that gap because they know that he never ever hits like weak ground balls between first and second, so he just doesn’t put anybody there. And Pujols was standing up there saying, “Well, they should eliminate the defensive shift because, you know, because this is the way baseball is supposed to be played and like this is supposed to be a hit, and you know, it’s not just me, it’s for the whole like betterment of the game.”

And meanwhile, I’m reading this and I’m thinking to myself like do your dinosaur, like, you know, and if you think that you can just legislate innovation out of the game because it’s personally hurting you as opposed to standing up and saying, You know what, I’m lucky that I played in an era where people didn’t do this. Now, as a hitter, you have to be savvy, like we need to improve, like I want to teach my teammates in order to how like they can adapt to it as a senior citizen and steward of the game.

[00:14:32]

Patrick: Yeah.

[00:14:32]

Sahil: And it reminded me a lot of sales actually in a lot of the way the sales leaders think, which is to say, you know, we are so scared of things like transparency in pricing. You know, like you go to a -- you go to a company’s website and look up, you know, their pricing. So, many companies still have like “Contact Sales” in order to fund pricing. Why? Like who wants to contact sales to find pricing, you know, like, companies should be transparent, but instead of embracing the fact that, you know, we need to have greater transparency, they’re trying to hide, even more, it confuses me, you know, I understand that logic.

[00:15:16]

Patrick: I think that -- it comes from a world where we had massive information asymmetry, right, if you go back to your used car, just your car example, right, you know, I’ve worked on cars, I’ve changed my own oil, but at this point in time, I have no idea what’s going on with modern cars because you can’t even really work on your own car anymore because it’s all electronics and things like that, right? So, all of a sudden, I’m talking to a salesperson, they have so much power over me because I don’t really know the truth. Now, they have less power than they might have had 5 or 10 years ago because they can use the internet to see if they’re giving me BS or not, but that information asymmetry still kind of exist.

And what we’re noticing is that with more and more competition in the market, with more, you know, difficulty in acquiring customers in the world of subscriptions, you’re just living in this world where that information asymmetry is coming down, you know, you have this defensive shift if you will, people being able to research, a lot of referrals and the word of mouth, people not contacting you until they’re deep in the research process and you might not have made that cut if you don’t have your pricing there. And so for me, the kind of rule of thumb when we’ve seen this with data is that if you’re really early on and you’re just optimizing for high friction conversation because you have no idea what you’re doing, so you just want to talk to the people who really, really care and are willing to get on the phone with you, that’s great, don’t put your pricing up, that makes total sense.

If you have a really custom deals where every single customer that comes on or every single prospect that comes on, it’s like a different package, then totally fine to not have that pricing up there. If you’re anything in between and even if you are that latter example, you should have some context, hey, this starts at $10,000. Hey, prices are between $20,000 and $50,000, prices start between, you know, 50 bucks and a 100 bucks or just actually have the pricing out there. And the reason for that is you don’t want bad leads. We don’t want people coming to us thinking Price Intelligently cost $50. We don’t want those types of people because it’s a waste of our sales team’s time.

Now, we will talk to them, we have a bunch of resource for them, we’ll nurture them, but we want them to see in our website even though there’s a lot of customization with that product in terms of what the actual price is, all of sudden, it’s like, we want them to understand that, hey, here’s a benchmark. So, if that’s not the benchmark, we probably shouldn’t get on the phone to talk about a partnership, instead, you should just use the free product, chat in to get some advice, that type of thing. But I think that you’re seeing more and more that pressure because again, consumers are getting more information and more power which, you know, I would argue is good, but, you know, you could make an argument that, you know, a business losing a ton of power is not so good.

[00:17:51]

Sahil: Yeah, I mean, I think that, you know, having worked at Glassdoor and having seen employers recoil at the concept anonymous reviews from candidates and from their employees and people putting salary information out there and that being seen as like a violation of trust and shouldn’t this be illegal and all these other things, to today’s world where no one would ever take a job without going to the company’s Glassdoor page. You know, I guess I’ve -- I have a pretty strong point of view on this, which is -- it is -- you can’t close your eyes and pretend that no one else can see you too. You know, the world doesn’t work that way. And so, you know, and given a choice between obfuscation and transparency, transparency is always going to win.

[00:18:41]

Patrick: Hundred percent.

[00:18:42]

Sahil: And for more information, that’s the world that we live in. And so, therefore, therefore, you know, I think you as a company either embrace it or you fall behind. I do want to touch on something that I’ve actually had a couple of conversations with sales leaders about that they say that -- and back to your initial point made about 25% to 30% plus pricing brakes and the hockey stick of sales and, you know, everything coming in at the end of the month or end of quarter. Well, what do you see around buyer behavior if anything, because what we here is that -- well, buyers account or procurement people would come based on beating you down on prices and they know that if we wait until the end of the month or the end of the quarter that, you know, that the price is going to drop. And so, they intentionally buy until then -- they wait for the discount and now, it’s just like -- it’s like, well, we can’t break the cycle because buyers expect it. What are your -- do you have any thoughts on that? I’m just curious.

[00:19:45]

Patrick: Yeah, yeah, I have a ton of thoughts because we face it because we do enterprise deals ourselves where they typically have a procurement department. What we’ve done and this is what we’ve learned off of, you know, some pretty successful folks and also just seeing some data in the market. This is where the strength or the power of a good salesperson really comes into play because, in that discovery call, it’s like the classic advice, right, that for some reason a lot of people don’t follow, which is asking, okay, so what’s this process like for you guys, you know. So, we’re going to have this and we have a security review and we’re going loop in Joe or Jamie or whomever from that department and then, oh, you go, “Oh, you have procurement. Okay, good to know,” like anything that they look out for, like, right. Like it’s the classic, you know, thinking about the actual sales journey and as soon as you know that there’s procurement, the price automatically goes up 10% to 15% because the procurement person is going to -- they want that 10% to 15%, you don’t want to get on the phone with that person and go, “Oh, crap, I forgot, now, I have to try to like take stuff away, so the price doesn’t change,” but they’re going to have to knock you down somehow, right?

And instead, like you get on the phone with that person and it’s a little bit of back and forth and here and there, but it’s, you know, you can be straight with them and say, you know, what are you guys are trying to do, right, like what’s a win here for you. Okay, let me see if I can get that and you’ve already kind of raised that price a bit to help with that. I think even a piece of this - particularly with quarters - is if you’re not a public company, which most people probably listen to this aren’t, you have power over what your quarter is defined by. So, we actually offset our quarters by -- I’m not going to say because I don’t want anyone to then use this against us, but we offset our quarters by a number of days if not weeks. I’ll just be very broad there.

So our quarters don’t end when the average quarter does. And that helps a lot because our sales team and we’re also -- we’re big enough but small enough where we can be a little flexible in certain places because we don’t want that pressure to basically, you know, be the reason why our sales team is being pushy. So, those are few things that we’ve seen and those are the things that we’ve kind of adapted to basically combat this.

[00:22:01]

Sahil: I mean, you know, sales force I think invented this contract on a quarter ending on January 30th or 31st close to December because I mean I think the initial concept there was, you know, everybody is on Christmas holiday and New Year, you’re trying to get deals done and that’s a shit show, and you just offset it by a month. But now, it’s becoming more and more involved because people are realizing like a way like this actually helps us in terms of our negotiation as well.

[00:22:31]

Patrick: Time is a construct, right. It’s a man-made invention, yeah, yeah, yeah.

[00:22:35]

Sahil: That’s right, that’s right. But let’s talk philosophically about the concept of quota for a second.

[00:22:44]

Patrick: Oh boy.

[00:22:45]

Sahil: Because I have a crazy opinion on this which is to say that quotas are singularly responsible for the negative stigma around sales. And that if we -- oh, we needed the concept of the quota and salespeople were compensated it based on the number of deals that they caused and it was -- there was no concept of how much you have to bring in every month and it was just, you know, as much as you hunted a deer, you got to eat and there is no number attached to that, there was no additional spiffs attached to going over or clawbacks if you didn’t hit certain numbers and like we didn’t do accelerators, decelerators, and all these other things. The entire profession of sales would have like just -- there would be a bunch of people who would leave because they would be like, “Well, if I’m not going to get all these accelerators, then I’m not going to be in it for real.”

But those are probably the people that you don’t want selling anyway because they’re just in it for selfish purposes. And I then, I think you would end up with -- and again, this is a crazy idea, so I’m going to -- I’m just going to finish the crazy thought. I think what you’ll end up with is a much more buyer-centric sales process because quotas are singularly tied to internal vendor things, they have nothing to do with the buyer. And so, if my quota is $25,000 this quarter or this month, let’s just say my quota is 25k and I’m at $17,500 and I need 7500 bucks to hit my quota and if my product costs $10,000 and I’ve got a deal and I go to my boss and I say, “Hey, I need something 7500, can I offer a discount this company?” They’re going to say yes and then, I’m going to go and offer the discount there in line, but only if you sign this month because then otherwise and then, of course, like, you know, this is the whole pushiness around sales and I think that there is a lot of negative ramifications to having quotas. What are your thoughts on this?

[00:24:53]

Patrick: I think, you know, I feel like it’s like comparing communism and capitalism. It’s like -- yeah, it’s a really great idea in theory, but -- the reason is because I think about -- there’s the kind of pejorative phrase that salespeople are coin-operated, right. And there’s a lot of those people where your sales -- like the way you compensate salespeople has a lot of power, you know, decelerators, accelerators. I’ve seen it work where we all of a sudden, you know, offer deceleration on certain things and acceleration on certain things and literally took a quarter to change things, right. It didn’t take a year, like we thought it was going to take it to the quarter, right.

But I see your point and I think my -- I have a little bit of a different view that’s in the spirit of what you’re saying, but I feel like when you have quota that controls that salesperson, you either aren’t supporting that salesperson in some way, the pricing isn’t setup in the right way to support and kind of take discounting on the entire equation, just to give you an example, if there’s a value metric based pricing model, basically it’s like one of those things where -- and you can’t really discount that, I mean, you can, but if you’re charging per hundred visits or per hundred XYZ or even per user, yes, there’s -- you can calculate what that is. But really, you’re not necessarily going to discount the actual core product.

And also, if you make sure that you have some flexibility for quota relief and things like that, I think you can kind of mix the benefits of what you’re describing and the benefit of an actual quota. Now, that being said most companies that go into with quotas they basically think of sales people as cogs, you know, and they’re points in the spreadsheet and what ends up happening is basically, exactly, like you said, it’s, “Well, have they hit their number?” “No.” Well, we’re not going to give them discounting authority and so, let’s just get rid of them if they can’t make it happen.” And that’s normally on larger companies, right. Like I think about HubSpot and HubSpot is a really, really good sales organization, but some of their -- the sales comp stuff that we’ve heard that they’re currently doing, it only makes sense that their company of the size of HubSpot. Like, if we implemented that here, it would be terrible, it would be a terrible idea. So, I don’t know, I guess I’m not saying, yes or not to what you’re saying and tell us of an opinion, I’m kind of saying it doesn’t feel like it’s completely possible, but the spirit of it I think is really, really good.

[00:27:25]

Sahil: Well, so one additional lens to look at this conversation was because again I think that quotas and pricing are so directly correlated and ultimately -- but I want to go back to what you were saying around salespeople be coin-operated.

[00:27:43]

Patrick: Yeah. Not all salespeople but --

[00:27:46]

Sahil: No, no, no. No, no, no. We’re not truly thinking on individual salespeople, we’re saying as an industry, we consider salespeople to be coin-operated and there’s this whole concept of hire for and fire to and, you know, like, you know, you’re only as good as your performance last quarter and, you know, there’s all these like outages around sales.

[00:28:05]

Patrick: Glengarry Glen Ross, yeah, yeah, yeah.

[00:28:06]

Sahil: That’s right. Yeah. Always Be Closing and Wolf of Wall Street and, you know, whatever it takes to close the deal. So, look, the reality is if I will look at the job descriptions for salespeople I see a lot of adjectives like hustler, I see sales ninja, I see someone who’s aggressive, someone who’s tentative, I see someone who’s got a lot of, you know, like a whatever it takes kind of mentality. I see a lot of things like that. And then, when I talk -- so I get -- sitting at Bravado, I get the opportunity to not just meet the salespeople, but I get that opportunity to talk to a lot of buyers. And when I talk to buyers, it’s funny, nobody wants to buy from a hustler, it’s weird, right. When I ask the adjectives of what types of salespeople they want to work with, they want someone who’s technical, someone who’s got a lot of product expertise, someone who’s respectful, someone who’s kind, someone --

[00:29:06]

Patrick: Relationship, yeah.

[00:29:08]

Sahil: Right. So why are we hiring people that are almost the antithesis of the kind of person that are buyers actually want to buy from?

[00:29:18]

Patrick: Yeah. I think it’s the old school versus the new school man. I think that you look at old school and still respects that. And in some ways that’s okay, like a little bit of -- like obviously motivation drive is very different than the hustler, the huckster, if you will, like those types of things. And so, I think for me in particular, the way I look at -- like when I look at our sales team we had people who are a little way to relationship be and then, we had people -- we never really hired like the traditional slinging and crashing deals like that kind of guy or gal. But I think that in a lot of ways, the control is, you know, what you repeatedly do when it’s the habits and behaviors that you have. I think it’s just as the same thing with like your sales team. I think if you hire a lot of, you know, huckstery aggressive folks that’s what your sales process is going to be and you better have a product that is low ARPU and just is slinging calls, right.

And most of us, we’re moving in the markets where relationships are important and product expertise like you said. And so, to me, it’s more like if you are cultivating your sales cultural in the right way to be buyer-centric and having some of that flexibility and maybe yes having some quotas and some accelerators here and there depending on what it is, I think you kind of bridge this gap between the old school and the new school. I’ve seen it done in a number of organizations like one I would think about is HelpScout, I don’t know if you’ve heard of that company. They’ve helped us, they’re pretty big. Nick Francis is the CEO and he’s a very kind of designed product-oriented person and he didn’t even want sales people because, you know, of the stigma about sales folks. But they do sales the way that HelpScout would do sales, which is very relationship, very customer because their support, you know, guest kind of helped us.

[00:31:07]

Sahil: Really?

[00:31:08]

Patrick: Yeah. So I think that it’s -- you can build the sales team you want, right. And, you know, you adjust and, you know, reset based on what’s good and what’s bad basically.

[00:31:18]

Sahil: See, I think that -- so let’s -- just shifting gears for a moment and then, we’ll bring it back here. We see the rise of chatbots and kind of innovation in AI when it comes to sales and we’re not as far along as everyone thinks we are, but you can also, you know, not to just be (inaudible), but I really do believe in the, you know, in the short run, we’ve overestimate how much change there will be and in the long run, we underestimate how much change there will be. So, I think in the short run nothing is going to change, but I think in the long run buyers will have a choice one day either I’m going to talk to a salesperson or I’m just going to chat with some AI thing or I’m just going to like buy through the website or whatever. We’re basically -- interaction with the salesperson will become a choice as opposed to a forced necessity.

You see that in B2C today already where if I go to Netflix this page, (inaudible) page and I’m not logged in, I just see, you know, 799 a month, no credit card required, one-month free trial, click here to watch, you know, what --

[00:32:23]

Patrick: Yeah.

[00:32:24]

Sahil: I go to Amazon, it’s like one click to buy, here are all your reviews, you do your own research, it’s like the product you want, you purchase it. You know, there’s -- and I think B2B is just always 10 years behind B2Cs, but if you go 10 years forward, I think this will be the norm in B2B. And so, other professions of sales which obviously I, you know, in the way that you champion, you know, pricing and pricing well at Pricing Intelligently --

[00:32:53]

Patrick: There you go.

Sahil: And, you know, making sure that you’re maximizing the amount that you’re getting from each customer, but not like scarring off the market or whatever. You know, we check in salespeople of Bravado and the profession of sales and in fact, I’ve written like a Hippocratic Oath of sales where, you know, talking about a code of conduct and best practice and like ethics around sales. And so, there’s like a lot of things we do in the space, but, you know, I am very nervous about the future of industry unless we stop doing things, the customers would -- if they had a choice would just make them say, “All right, well, screw this, I’m not going to deal with you.” And one of the things that I am most sensitive towards, the thing that is really annoying because it happens to me every single month and every single quarter for any product that I’ve ever taken a demo of ever, the sales rep magically emails me and says, “Hey, Sahil, I’ve got just one or two more discounts left to go this month and we can do 30% and I know that that wasn’t a good time--”

And it’s just like all it makes me think is holy crap, like you must just not be at quota, you know like you just must be struggling. It just makes it -- and it just makes everything feel so desperate and that is a feeling that I think nobody likes. And so, if we go back to our conservation around sales and the way it’s done in quotas and all the rest of it, you know, is there a world in which the profession of sales, you mentioned HelpScout which I think is a great example. I’m going to -- I’m going to bug you for an intro to that CEO, I want to chat with him. But is there a world in which sales people in sales and that profession (inaudible) in the long run, not in the short run.

[00:34:41]

Patrick: Yeah.

[00:34:42]

Sahil: In the long run without adapting just like a completely different set of practices that just are not archaic and old school, like I just don’t see it, you know.

[00:34:50]

Patrick: Yeah. I mean, yeah, sales has been around for thousands of years, right, in some manner, whether it was, you know, someone trying to trade something in a market or sell something in the market, right. I think there’s -- Hal Porter over at SalesLoft I think has kind of the best, the best quote on this, and I’m going to butcher it, but sales is basically like -- it’s like -- fuck, I can’t even remember it unfortunately, but it’s like something along the lines of, you know, it’s transferring belief and transferring the value from your mind to the other person. He does it much more eloquently and I think that sales will still exist in that manner, but it will be less trickery, right, because we can’t -- there are probably always be some trickery in sales and I’ve used that term very specifically because it’s not always the fairest, but it’s still as a little bit of trickery if that makes sense.

I think it’s just going to be -- we’ve kind of have seen the playbook over and over again and then, in the world of like human beings of human psychology, it will be a lot easier to understand BS and trusts and all of those types of things. And so, the salesperson’s job will be more like, “Okay, cool. So, what questions do you have?” You know, it’s a little bit more of a reactive, you’re ready to go or I reach out at the exact right time. This doesn’t feel bad for either of us. It feels super personable and super relationship base and I feel like I can call you when I need something as a customer. And I think that’s where the evolution is going to go and basically just because information asymmetry is going to decrease significantly, it just going to keep decreasing.

And I think that’s great. I think that’s a world where we’ll exist and we won’t feel bad about ourselves. And, you know, the aggressive folks will move on to, I don’t even know, the small industries that are still --have large information asymmetry.

[00:36:44]

Sahil: And that’s right, you know, something to that point which I really believe in and I had really, you know, agree with you deeply is the fact that information asymmetry is at the core of the trickery in sales. So, I would say that because it is just that like, you know, if I ask you a question, does your product do this? Now, you as a salesperson have a choice, you can answer yes or you can say no. And most of the time you’re going to say, yes and or yes but, sort of saying no, because if you’re going to say no, then you’re like not going to close the deal or potentially going to lose the deal.

[00:37:21]

Patrick: Yeah.

[00:37:22]

Sahil: And it is that -- it is that ability of a salesperson to deceive because it is deception at its core. It is the ability to deceive that information asymmetry allows, but not if the buyer is able to just ask that question, you know, openly and get the answer from someone who isn’t incentivized to sell you. Then, I think that at that moment, you know, what is the role of a salesperson. So, when I think of like the role of a salesperson in the future, I think that there will be kind of a hybrid of salesperson and sales engineer where everyone will become more technical, everyone will become more product focused, and just in the same way that you hire Bain or Accenture or McKenzie or someone to come in and do analytics and make recommendations under in your best interest because you paid them and they are therefore going to consult you. I think that there will be a rise of a class of professionals who will be middleman between vendors and buyers. I really do believe that. I think that they’re professional purchasers, like MarTech stack advisor and not --

[00:38:28]

Patrick: Yeah. You’re kind of seeing this already. This is popping up. I mean a lot of the research firms like Forrester and Gartner and things like that surely do a lot of that, either through kind of like (inaudible) reporting or through I believe some one-on-one research. But that, yeah, I think it’s super interesting you say that. I think it’s -- I think that there will be a rise of that and it’s kind of juicing the whole concept of like word of mouth, right, because that person is basically an influencer in the market. But I don’t know, I think -- I do think that the deception will decrease, so the trickery will decrease, but I don’t know, I just kind of feel like there’s still going to be sales and there’s still going to be, you know, we’re going to have this conversation but maybe the inputs or the things we complain about are going to be a little bit different. But it’s, you know, that’s just the nature of human beings and, you know, always be better.

[00:39:27]

Sahil: There you go. I think that’s a good -- I think that’s a fun point for us to have this session because this has been a blast. And Patrick, I could honestly spend the next like five hours here talking to you like this stuff. You’re just a blast to chat with, man. I --

[00:39:42]

Patrick: Thanks, man.

[00:39:44]

Sahil: For anyone who wants to get a hold of you, what is the best way to get in touch if they’ve got follow up questions or want to pick your brain about something?

Patrick: Yes. So, two places here is Patrick Campbell on LinkedIn. There’s a number of Patrick Campbell’s but you’ll see this bright and shiny bearded man for my own self. And then, pc@profitwell.com is how you can reach me directly. I typically get back to everyone, not always right away, it might take some time but definitely if you need my advice on pricing or anything like that which I (inaudible) a number of companies I can, you know, definitely help.

[00:40:18]

Sahil: Awesome. Well, thank you very much for your time, Patrick, and I really enjoyed our session today. It’s a really good conversation points and I look forward to having you hopefully as a guest sometime in the future.

[00:40:29]

Patrick: Awesome. Thank you.

[00:40:30]

Sahil: Thanks, man. Cheers. Bye.