Press: Electronic Industry Press
1. Role change: from pure financial editor to product operation, I want to know more about the operation routine of TO B products.
2. Industry Understanding: The company is in a relatively vertical industry, and I want to understand the methodology and practical cases related to saas products through this book.
SaaS(Software-as-a-Service) originated from a new software service model founded in America. In China, sass is still a new business field. Firstly, the author introduces the development status of saas field in China and the characteristics of saas model, and summarizes the five stages and four main lines of SaaS entrepreneurship. The main content of this book is gradually developed around the five stages of saas entrepreneurship (the five stages of entrepreneurship integrate four main lines).
These five stages are:
1. Product creativity and choice of business model
2. Product polishing and preliminary verification of business model
3. Create a sales style and verify the gross profit model of the sales team.
4. Organizational development during the expansion period
5. Efficiency improvement
These four main lines are:
Product and model
business
Team and culture
finance
The essence of 1.saas is updating.
The essence of saas is "renewal fee", which is the essential difference between saas and traditional installation and deployment software.
When I first saw this idea in a book, my eyes lit up, which greatly changed my view on the company's profit model.
At present, the B end of our company also accounts for a large part of the renewal income of saas products. Before, we always thought that the renewal fee was an "old plate". This model is unhealthy and needs new family income to realize the growth of the company.
After reading the explanation of this sentence in the book, I realized that it is the core for saas products to renew their fees. Of course, the inclusion of new households is also very important, and expansion is the basis for obtaining more renewal income.
Why is the essence of SaaS renaissance?
Because the biggest difference between saas and traditional installation and deployment software is that the former pays for renting services on an annual basis, while the latter buys them out at one time. This seems to be just the difference of "quotation method", but in fact it has brought great influence on service model, sales model and company valuation.
Take the service model as an example. The high failure rate of traditional software implementation or poor experience after online use is actually a mechanism problem of "mismatch between income and contribution".
From the perspective of traditional software companies, the sales performance task has been completed when signing the contract. In this case, the sales staff will aim at "winning the bill" and even over-promise when the competition is fierce, even if it is to "dig a hole" for the later executive departments. In the future, you may only charge a small amount of maintenance fee every year, which will not benefit much. If it is difficult to collect, discard it.
The annual fee for SaaS is completely different. A SaaS product with annual payment may only charge 1/3, 1/5 or even lower in the first year. After the customer contract is implemented, there will be a "customer success department" to take over the service, and this customer success manager has a very clear goal, which is to let customers use the products well, so that it is possible to renew the fees in the second year and continue to provide good service, and then you can collect the service fee for N years!
Therefore, SaaS services must be more secure and critical.
On the contrary, if SaaS companies charge a one-time fee for three or even five years, it is risky for customers. Because there is no annual fee for four years, SaaS company will not pay attention to this customer for the next four years. So you can't charge the annual fee in advance.
2. An important method of product creativity verification: MVP.
In the first stage of product creativity and business model selection, the most important methodology is MVP (minimum feasible product), that is, rapid iterative product prototype.
Only fast, can we have the opportunity to repeatedly verify the accuracy within the effective time window of the market.
The concept of MVP is enlightening. This "prototype" can be H5 with UI interface or a hand-drawn demo. Not limited to form. The key is to make the value clear and get feedback from customers.
This method is actually mentioned in many places, not only the verification of product creativity, but also the verification of operational creativity. The quickest way to know whether an operating creative user is interested and can achieve the expected goal is to make a "minimum applicable model" and then give it directly to the user for verification.
The first stage of saas entrepreneurship roadmap-product creativity and business model selection, the sign of successful closure of this stage is:
On the one hand, communicate with customers through the simplest product prototype, accurately capture the general needs of customer groups, and verify the authenticity of the needs of target customer groups; On the other hand, I have a deep understanding of the business model I have chosen.
3. Key tasks and methods of product polishing and preliminary verification of business model.
Key task: to form a universal "product value and business model verification", specifically, the product maturity reaches the level of "saleable". The CEO or other members of the team can sell products.
Two common mistakes in product research stage:
1. With the product direction, the research is very simple, behind closed doors in the office, and the engineer's idea of "perfectionism+system logic" leads the research and development work.
2. The mistake of "large-scale investigation" is only to find the various needs of users, but not to grasp the key points and differences.
In this part, the author mentioned the difference between TO B and TO C product requirements. First, the C-end demand is more emotional, while the B-end demand is very rational. Second, compared with TO C, TO B has poor consistency with customer needs. Even within an industry, there are great differences in business and organization between enterprises.
So, what should be the correct way to polish the product? The author lists the following research framework to solve the problem of product polishing:
(1) The market of any industry should be subdivided, and breadth sampling research should be done to understand what the main attributes of target customers are, the number of each type of customers, the urgency of demand and purchasing power.
(2) Select the head products of 3-4 market segments, conduct research within this specific range, and find the sexual demand. Founder, product manager and marketing partner should participate in the research together, and grasp the product value, product experience and product selling point respectively.
(3) Don't complete the function at one time. New products should be "sharp" rather than complete. This is also what MVP should mean.
The biggest inspiration for me here is: when doing product value verification, we should extract the portrait of the target user and subdivide the users, because a product cannot be suitable for all users. When I was doing the first product value verification of electronic invoice products, I lacked this awareness.
4. Be careful of the "free" strategy of 4.to B products.
Most to C products are free when used, such as 30-day free membership of wps and 30-day free membership of Baidu network disk, and then quickly get customers and then pay for conversion. However, compared with TO C products, TOB products (for example, SaaS products) will encounter the following problems when they are given to users for free, which need careful consideration.
1. It is too easy for customers to give up, and it is difficult for saas companies to collect in-depth usage requirements.
The free strategy will rapidly increase the number of customers, but customers lack the consideration of the necessity of using the system before using it, and it is easy to give up when they encounter difficulties in using it, and they have not given up the cost.
This is very unfavorable for the polishing of application scenarios, functions and user experience in the early stage of new products. To make a product, you have to knock yourself to death, and the customer who pays for it is "true love" in order to make all kinds of real demands.
2. Avoid brushing, and the management cost is too high.
Free is easy to cause marketing teams and agents to brush their bills. For example, in the book, an OA company launched its products through an offline team of 5,000 people all over the country.
Customers are allowed to use it for free, and the company subsidizes the sales team and agents with huge sums of money. As a result, the number of users has increased rapidly, but after three months, the activity of products has been declining, and the number of "active customers" actually obtained has not changed much.
3. The service pressure is high and the service level is declining.
The influx of a large number of free customers has reduced the service quality of paying customers. For example, it is difficult for corporate customer service to separate free services from paying customers. At the same time, among freelance customers, low-quality and high-quality customers are mixed together, and the efficiency of customer service team's active service is also low. If the final retention rate of free customers is low, customer service colleagues will be extremely lacking in sense of accomplishment.
Finally, the author also mentioned that when an enterprise buys a product, there are not only purchase costs, but also decision-making costs and training costs, so there is no "free product" for the enterprise.
The ticket tax SaaS product developed by our company is not frequently used by users (once a month on average), which belongs to a very vertical field. It is important to verify PMF (product-market matching) through pricing in the early stage, constantly revise and improve the product definition, and find the target users. It is inappropriate to get a large number of users who don't match the product value for free, and then fall into the dilemma of "low activity and difficult promotion".
5. What are the advantages of setting "refund conditions"?
When it comes to the issue of "refund conditions", everyone may have some concerns. Will the refund affect the income? Affect the company's reputation? Affect the sales performance?
But the author's point of view is that under normal circumstances, the "refund clause" is a win-win choice for the following reasons:
First, the refund clause can reduce the difficulty of the transaction;
Second, the refund ratio of an enterprise-level product is very low;
Third, "refund" is a good opportunity to enhance product value, improve work quality and find management problems.
It also shows that a good mechanism is better than 10 thousand daily management.
6. What are the responsibilities of the customer success department?
It is mentioned in the book that customer service is too important in the early stage of starting a business, and both the founder and the product leader should personally serve the customers. With the appearance of sales effect and the increase of customers, a high-level exclusive customer success team should be established.
In order to manage customers successfully, this book has a special chapter to elaborate. The main contents include what is the responsibility of the customer success department, how to determine the assessment indicators, what is the talent portrait and recruitment path, and the successful working methods of customers.
What impressed me most was the following customer value funnel diagram of SaaS company:
This picture vividly shows that for SaaS products, the after-sales customer journey is not over, and there is still a customer success journey, and the ultimate goal of the customer success journey is to realize the introduction of high NPS customers. It deepened my understanding of "customer success".
In addition, the overview of the responsibilities of the customer success department in the book also gives me a more comprehensive understanding of what the customer success department may do. Although our company's independent customer success team has different responsibilities, the core is the same.
The author lists the specific responsibilities of the customer success department as follows:
1. Guarantee renewal fee for customers.
Because saas customers renew their fees every year, the primary responsibility of the Customer Success Department is to ensure that they renew their fees.
2. Customer expectation management
It is impossible to predict the change of people's (or power-influenced) value perception only by monitoring activities, so the risk of renewing the contract needs to be intervened in advance by contacting the industry, customers and stakeholders in the early stage.
Many times, customers can't use the products well, not necessarily because the products and services are not good, but because there is a difference between customers' expectations of "success" and the degree to which the final products can meet. Therefore, it will be a very important duty for the customer success department to understand the customer's expectation of "success" when it first contacts customers.
3. Early activation
The practice of saas company for many years proves that the first 30 days of customers' purchase is the key period for customers to use their products.
4. Exception handling
CSM, which serves small and medium-sized customers, is responsible for a large number of customers, but after customers use it, CSM does not need to pay attention to all customers every day. SaaS operating system will give early warning to customers whose activity drops suddenly, reminding them to get involved as soon as possible.
Regular communication
CSM needs to communicate with customers regularly at a certain frequency (determined by customer level and status).
Increase the purchase volume
Generally speaking, the increase in the purchase volume immediately after the signing of a new contract is more related to the sales representative, but after 3- 12 months, the increase in the customer purchase volume is more related to CSM.
7. Output customer use cases
Different from the benchmark customer case output by the marketing department, the case output by the customer success department is closer to the customer's use plan and specific business. These cases are more used to guide other service colleagues and also used in one-to-many customer operations. Including online training, online salons, etc.
1. A good mechanism is better than ten thousand times of daily management.
2. Universal tool-based saas products, whose main value is to help enterprises improve efficiency.
3. Compared with the tool SaaS, the characteristic of commercial SaaS is that it can not only improve efficiency, but also provide added value for customers, including increasing income and obtaining funds.
4. How to face the market competition? Before entering a new market, do a survey:
How many players are there in the new market?
How long is their history? How is your life?
What difficulties did they encounter? If you enter this market, can you avoid it?
5.5. In the second stage of SaaS entrepreneurship, to polish products, it needs to be "stable", which is reflected in several aspects:
Products can really be sold: to strange customers, not just to the company of the boss's friends.
People who sell products: not only the founder can sign the bill, but also the sales representative who conforms to the "portrait of marketing talents"
Number of orders signed: If the customer price is less than 40,000 yuan, at least 10 customers should be signed to avoid unexpected situations.
Employees of client enterprises can get started quickly and make good use of products.
Although this book is called "SaaS Entrepreneurship Roadmap", as long as you work in a SaaS enterprise, even if you are not an SsaS entrepreneur, it is well worth reading. Let me have a more comprehensive understanding of the business model of SaaS industry and the operating ideas of SaaS enterprises at all stages.
The contents listed above are only part of this book. The book contains dry goods about how to establish a sales style (similar to what we had to do in regional market operation before) and how to establish a business index system to improve efficiency. Interested partners can learn about this part.
Practice is the only criterion for testing truth. The above experience may not be correct, but it needs to be verified through continuous practice in the follow-up work.