Box CEO Aaron Levie knows selling enterprise software is a long, complicated process.
But after years of running his software company, Levie is now able to articulate the changing enterprise sales model in simple terms.
“You make your product as easy as possible to adopt but you make it so a large enterprise can fully adopt it across their entire company,” Levie said at a recent press gathering.
In other words, enterprise software is no longer bought by a single decision maker within an organisation. He believes to a certain extent it needs to first grow organically within the business, which then makes it easier to convince the final decision maker to buy your software.
But virality alone won’t get the deal done. Your product still needs be good enough to have what it takes to meet the strict compliance and regulatory issues most big business customers require, and that decision is still made by the company’s CIO.
“There’s probably not a single enterprise that we ever sold to that didn’t start with users in that organisation having adopted Box,” he said.
“But even if you had 100% adoption of your product virally in that organisation, you would still have to go through a process of how do we make sure that we can meet the compliance requirements we have, how do we make sure we meet the legal needs we have, so that’s a separate role of sales.”
In that sense, Levie believes salespeople may even need a new title because they’re not necessarily selling the product after a certain point. Rather, they’re working closely with the customer’s IT department to help set up technology that meets a whole set of requirements in security, compliance, and legal work. That’s a real technology decision that costs a lot of money and time, he says.
Perhaps that explains why Box has been one of the heaviest spenders in sales. Although its sales and marketing cost is now shrinking relative to total revenue, Box’s sales expense once exceeded the total amount of revenue it generated.
“We obviously spend a lot on sales because we have to go into the GEs of the world and Eli Lilly’s of the world, but in all of those organisations they were already using Box,” Levie added.
“That’s the future of selling: end users adopt it, then at a level past some usage threshold, the enterprise standardizes.”