This blog aims to help C-Suite and VP-level leaders better understand these professionals to effectively win more business, particularly in bear markets
Gartner recently estimated that $3.8T of information technology expenditures take place between sellers (vendors) and buyers (businesses). Yet the vendor’s technical sales professional -- the person in charge of proving a product’s value and technology capabilities -- is mostly overlooked by modern sales and marketing tool providers and training organizations.
Fortunately, experienced go-to-market (GTM) professionals recognize the important role these technical sales professionals play in driving the business. As one very seasoned high tech CEO recently put it to me, “Many account executives have attended the President's Club on the backs of these sales engineers, Great businesses have always known how to wisely invest in this talent pool.”
Today’s blog post will expand a bit on this evolving community, how they impact growth, and what organizations can do with this talent pool to win more business, even in bear markets.
Understanding your technical sales talent
There are more than 500,000 technical sales professionals (also known as sales engineers) and millions more who at some point in their careers held that role. The craft of engineering playing a role in sales goes back to the beginning of the technology revolution. As technology sales have evolved from on-premise hardware to software and self-serve SaaS packaging, the titles of these technical sales professionals have expanded, as depicted in the figure below, but the function is still the same. Technical sales professionals are responsible for demonstrating product value to the buyer to earn the purchase.
In today’s markets where purchases are heavily scrutinized, crowded with vast numbers of competitors, littered with technical jargon and filled with convoluted value propositions, these technical sales professionals are more critical than ever to win business. To better understand what constitutes a technical sales professional, let’s first look at the community.
Technical sales professionals are typically engineer-minded people. They are extremely intelligent, love problem solving, want to understand the technical problems buyers are looking to solve, are competitive, and are expected to be domain experts of their technology industry and products. With such a highly skilled and intelligent talent pool, it is common to see the following:
* Compensation structure. Yearly salaries can range from $125,000 to in excess of $250,000 per year. It is common for the on-target earning (OTE) compensation to have some split of fixed and variable. The common split is 70% base and 30% bonus or commission based.
* Quota objectives. You can see one technical sales professional support anywhere from a $1M to $10M annual recurring revenue (ARR) yearly quota, depending on the company and industry.
* Sales ratios. Depending on the complexity of the technology associated with the product, you can see the ratio of technical sales to account executive range from 1:1 to 1:10.
* Hard and soft skills. Technical sales professionals are expected to have hard skills, such as intimate knowledge of the technology, industry and product. But they also must have or develop soft skills like storytelling as well as the ability to qualify opportunities and empathize with prospects. These skills help them connect the technology to key business drivers, so that technical sales professionals can effectively show the product’s value.
* Trusted advisor. Very often buyers see these technical sales professionals as trusted advisors who can guide them on how a product or service will solve both functional needs and meet business objectives. As a buyer put it to me recently, “You can trust technical sales professionals, because they either show you what their products can do or they don’t. It’s a binary outcome.”
Now that we have some level of appreciation for the technical sales professionals, let’s examine the level of criticality they play in driving growth and increasing the company’s enterprise value.
The impact on growth
Technical sales plays an instrumental role both in landing new business when structured under the sales organization, which is common, and expanding business when organized within customer success that may own both pre- and post-sales. To illustrate a generic funnel, below are six pre-sales and two post-sales steps for growth that are mapped to the technical sales RACI (Responsible, Accountable, Consulted, Informed) framework.
Let’s look at these first six pre-sales steps in more detail:
* Awareness. Technical sales often informs marketing on how product messaging is impacting the quality of prospects entering the sales funnel from it's demand generation efforts.
* Qualify. Technical sales may be consulted by account executives in the sales organization to determine if a given prospect meets the criteria as a future customer for the product being sold.
* Present. Account executives and technical sales are responsible for telling a compelling story during their sales presentation in a way that is highly differentiated above the competition and clearly conveys the outcome that product features and functions enable.
* Demo. At this stage, it is common for technical sales to be accountable for managing an in-person or remote demo, where appropriate qualification is done, to show that key features and capabilities meet the prospect’s need(s).
* Evaluate. Technical sales is accountable for this sales stage commonly referred to as POC (Proof of Concept), POV (Proof of Value) and/or Guided Trial, with different levels of engagement with the prospect.
* Purchase. Winning or losing business is a shared responsibility between technical sales and the account executive(s). It is imperative that clear collaboration exists between both parties as it is often that technical sales compensation is tied to the quota retirement objective of his/her corresponding account executive(s).
Now, let’s look at the next two post-sales steps:
* Implement. It is common for the customer to consult with technical sales on initial success criteria and key product purchase considerations to ensure that the customer is satisfied with their purchase decision.
* Expand. Customer success and, in some cases, salespeople responsible for renewals and expansion, will consult with technical sales resources to build on existing technical relationships to up-sell new product capabilities.
As illustrated, technical sales professionals play a critical role in both pre- and post-sales steps that fuel growth. However, their impact not only affects top-line growth, but also organizations across various disciplines. Let's look at that more closely.
The organizational impact
It takes various disciplines to build a company, and technical sales is one of those few roles that has an impact across sales, product, marketing, support and engineering.
Let’s look at those in more detail:
* Sales. Technical sales has various touch points within sales, as it actively participates in helping account executives qualify, demo and manage evaluations that ultimately win or lose business.
* Product. It is highly common for product management to have very close ties to technical sales, because technical sales professionals will often help define new key features that the market wants and will help the company differentiate its product to win more business.
* Marketing. Experienced marketing professionals will leverage technical sales to get a pulse of the messaging that is resonating so that they can make the necessary marketing adjustments.
* Support. Now commonly referred to as customer success, the support team will often leverage technical sales to streamline implementation and improve the product experience for the customer.
* Engineering. Companies are full of stories where technical sales professionals identified key bugs that needed immediate remediation to win new business, especially during the evaluation period.
Good technical sales professionals cause big ripple effects throughout the organization. Their insight, recommendations and feedback can make everyone in the company better, which ultimately results in growth from new business. This is why there are millions of high-tech professionals who started in technical sales and eventually end up in sales, product, marketing, support, engineering and other leadership roles. To better appreciate the role of the technical sales professional and make them more effective, it is highly recommended that C-Suite and VP-level leaders invest wisely in this talent pool. Let’s look at some investments that can be made.
How to make technical sales more effective in your business
Whether your company is in a bull or bear market, I would propose that wise investments in technical sales will give your company one the greatest leverage points for growth.
Let's examine both the tactical and strategic investment a company can make that will deliver a compelling return on capital. Let’s first start by looking at what can be done tactically.
* Training. Skills, experience and knowledge can vary greatly within a technical sales organization. I have found that pairing senior and junior technical sales talent can be quite productive. Additionally, there are great books and training resources that have a proven track record of improving your technical sales efficiency. Some notable books and thought leaders in the industry, who also provide training, are:
- Mastering Technical Sales: The Sales Engineer’s Handbook by John Care
- The Six Habits of Highly Effective Sales Engineers by Chris White
- Great Demo!: How To Create and Execute Stunning Software Demonstrations by Peter Cohan
* Tooling. Technical sales teams are notorious for building their own tools. Encourage the innovation that drives operational efficiency but also look for ways to scale best practices by finding commercial tools designed for this community whenever possible. Commercial tooling for this community is an emerging market; expect more products to enter the market.
Now looking at what can be done on a strategic level, make sure technical sales has representation at the C-Suite and VP level. Let’s expand on why you would want that.
* Product. Technical sales professionals are at the front lines of your growth engine. They interact with prospects who are deciding to buy your product based on the technical merits and capabilities that are above your competition’s. Make sure that feedback from technical sales on how the product can be improved does not fall on deaf ears or gets lost in translation. I have seen companies fail because they did not listen to their technical sales professionals and instead built features that did not provide that edge to win business against the competition or adequately meet the needs of the prospect to earn the business.
* Superior Value. Your product’s capabilities and the prospect’s experience with your technical sales must deliver a differentiated value above your competition’s in order to win new business. Having a superior product is not enough. I personally have seen a seven-figure deal lost, despite having the best product in the market, because technical sales processes were poor and the prospect lost all confidence in the company’s ability to scale and support their needs adequately on a global basis. If you pay close attention to the prospect and customer experience by providing the right support to your technical sales, you’ll increase your likelihood of landing and expanding on new business.
Technical sales have been the unsung heroes of growth. They play a key role in the sales pipeline, impact the organization and are often left to their own devices to be more effective. In market conditions where companies must do more with less, focus on initiatives that deliver the most leverage and return on investment. Now is the time to really look at and invest in technical sales to make them more effective. By doing so, you can create greater sales efficiency, protect or drive your top-line growth, and increase your overall enterprise value.
Here are ten questions to better understand if your company is effectively utilizing your technical sales talent:
- What is my technical sales to account executive ratio? Is that the right ratio in my industry?
- Do I have the right technical sales leadership to hire the right staff and scale processes that win business?
- How much investment have we made in in-house and commercial tooling to improve technical sales/ productivity?
- Does technical sales have a seat at the table to collaborate with other departments?
- Are they armed to effectively demonstrate technical value to prospects and win over the competition?
- Have I set the right budget to train and develop this important talent pool?
- Do we have the right KPIs and OKRs to ensure that we are getting our money’s worth from this talent pool?
- What low-level aspects of their day-to-day work can we automate so we can make them more effective in selling products/technology?
- Are the right monetary and non-monetary incentives in place to keep these professionals highly motivated?
- Are these professionals adequately compensated and recognized throughout the company?
Freddy is passionate about PreSales. He's contributed to 1 IPO and 14 acquisitions. Scaled teams from 1 to 50+. Oversaw 1 to 5,000 product SKUs that contributed 70%+ gross margins and generated $1M to $1B+ ARR. Held various C and VP level roles. Oversaw marketing, product, business development and sales operations functions. Volunteered at StartX (Stanford Incubator), HITEC (Hispanic IT Execs) and CTO (CleanTech Open). Connect with Freddy on LinkedIn.