Four Ways the New Economic Environment is Changing Tech Sales

tech sales Jun 04, 2023

The current economic landscape may appear daunting, but it also presents an opportunity for leaders to embrace change and thrive. The ability to swiftly pivot and make strategic adjustments is crucial for achieving success. By staying attuned to emerging trends and adopting an agile mindset, companies can not only survive in this new economic environment but also gain a competitive edge that positions them for long-term growth and prosperity. In this evolving landscape, the tech industry will undergo four key changes, and companies that can adapt to these changes will emerge stronger than ever before.

1: Focus becomes paramount for sales teams If I were to sum up the future of sales in one word, it would be focus. Over the past five years, many tech sales teams lost sight of their focus. This was understandable as enterprise tech providers had ample venture capital funding, and buyers were eager to adopt new technologies for their businesses.

Consequently, the sales process didn't require the same level of strength, nor did there need to be a compelling product-market fit. Buyers had the freedom to purchase technology without undergoing rigorous decision-making processes. This dynamic fostered what can be described as unfocused business execution.

However, in the face of a tech downturn, we are entering a new era where focus will matter more than ever. Moving forward, sales teams must return to the basics, emphasizing value-based selling and gaining a true understanding of how their product or service can deliver tangible value to customers.

The opportunity for sales teams lies in comprehending the unique challenges and goals of their prospects and customers. By presenting technology solutions that align with and support their success, sales teams can build trust, establish lasting relationships, and provide genuine, valuable solutions.

2: Services take center stage The notion that Software as a Service (SaaS) would render services obsolete is a fallacy. Customers struggle to derive maximum value from technology products without adequate support services. Companies must ensure that their SaaS applications not only function effectively but also integrate seamlessly into the overall enterprise environment.

Therefore, even amid broader layoffs in the tech sector, certain providers will actually expand their services headcount. In fact, some large tech providers are anticipating that their services business will surpass other divisions within the next few years. They recognize that customers seek assurance that their new technologies will work efficiently, and it is the services team that can provide that assurance and support while ensuring optimal utilization of technology investments.

3: Finance regains influence During the boom years, finance often took a backseat when deals were closed and sales were finalized. Corporate technology buyers would often bypass their finance departments. With substantial funds available and a board-level push for growth at any cost, companies would quickly make significant purchases without consulting finance or analyzing budgets.

However, in the coming year, financial planning and analysis (FP&A) will resurge with renewed vigor. The message will be clear: if you're not engaging with your FP&A team, you need to start doing so now. Going forward, there will be increased pressure to closely align with finance and scrutinize every investment. Corporate leaders will insist on having finance involved before any expenditures are made.

4: Standalone tools face headwinds If you offer a tool or technology that is not part of a larger platform, it will face challenges. Personally, I am actively reviewing my portfolio of technologies and SaaS applications, identifying which ones I can consolidate or cancel. In the current economic climate, companies are increasingly seeking a single platform that seamlessly integrates with other technologies, allowing for greater value.

This means technology providers must focus on offering solutions that can easily integrate with customers' existing platforms, providing immediate value and streamlining the adoption process. This shift in focus benefits both providers and customers, enabling smoother implementation and usage of the technology.

For instance, consider a company that utilizes Salesforce. They will closely examine other tools that seamlessly integrate with the Salesforce platform, delivering immediate business value. In today's market, companies prefer new capabilities that fit seamlessly into their existing platforms, avoiding the need for major investments.

Final Takeaway:

This is a pivotal moment for companies to reevaluate their strategies and make strategic adjustments to maintain competitiveness in the market. Those who adapt to changing market conditions by adopting a focused approach to the sales process or expanding their services offerings will be well-positioned for success. While the market may be shifting, there are still abundant opportunities for companies to thrive and experience growth in the coming year and beyond. By embracing these changes and proactively addressing the evolving needs of customers, organizations can navigate the new economic environment and emerge stronger than ever before.

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