The Long Sales Process – aka, rolling with the blows

8 Jun

iBegin Source has been a learning experience that has opened my eyes a lot – sales cycle, perceived value, etc etc.

We’ve had a lot of experience with doing small sales (< $500) - eg ForumTemplates (in the last 22 minutes the site has had five sales at $17.00 each). Automated processes, quick and detailed instructions, forum for general support (everyone can ‘learn’ together), etc.

iBegin Source has been a different beast. A few of the following points to learn:

  1. Perception. Price in itself is a huge part of the perception. Would a Ferrari be a Ferrari if it was priced at $100,000? Whenever you sell something, you have a markup – the revenue on a sale minus the cost of good + cost of sales. So when people see $40,000/$1000 they think – “this can’t be right” or “they must just be resellers”. We are neither. We’ve invested a lot into this project, but – data sales is not the end all be all. If we don’t make a penny from sales, we are still okay. The reality is that we created this system as a way of powering iBegin city sites across North America. We have only ourselves to blame – our story (which is unique) isn’t published properly. Need to fix that.
  2. People are demanding. For example geocoding – its an imprecise science. No one has 100% coverage (it is impossible – no central place for all geodata. Even the US government’s data is incomplete). Managing expectations is hard – I’m not saying bad data is okay, I’m saying that just like you didn’t expect to get 100% on every test you took, local data is so dirty and murky that the same rules apply here. The only solution? Honest answers. We had a buyer of Florida data point out an error we had. We immediately thanked him, and said we would get back to him. In 24 hours we had identified the problem (incidentally it only affected Florida), explained what had happened, and let him know we had fixed it.
  3. The sales cycle is long. It can be very long. We have big (ie massive) who contacted us on the day we launched, and take weeks to reply. Various department heads ask the same questions. Sometimes the person him/herself asks the same question again. On the individual/start-up level, the same questions exist. A big question – can they trust us to be around in a year? Five years? (more on that in a bulletpoint below). We had one customer contact us within two weeks of us launching. Last week he purchased one state (an 80 day turnaround). He has promised to buy the full data, but I assume that will take another 2-3 months. So almost 6 months to go from initial contact to sales. That isn’t a small cycle (then again quite a few have bought without even contacting us, so there are two sides to every story).
  4. Branding. This is different by perception – perception is more about the quality of the data, whereas branding is more about the quality of the company. Can we be trusted? If we aren’t funded, how are we doing this? Are we scraping results? (to answer those: yes, we’ve grown organically over many years, and no). This again points out ‘our story’ – it is unique, and we should be proud of it (not that we aren’t, we just don’t show it off). The old adage of “no one ever got fired for buying from IBM” bites us square in the butt here.
  5. Flexibility. The beforementioned forum templates sales are easy – it is a design, and you buy in. Some customers asked that the header be customized, but that is all very easy to do. When it comes to business data – requests are all over the ballpark. From a single category in a single city (eg ‘Vegas Restaurants’) to asking to use data on upto a million domains (seriously), people have different needs. In most cases we have stuck to the system. Our entire pricing system focuses on efficiently handling scale and sales – 10 customers or 1000 customers, our internal backend works the same. In some special cases we do bend (eg using the data on multiple domains), but in almost all cases we stick to the system. In the short-term this may not be the best idea, but it lets us focus on the core data and the systems that deliver it. I believe this approach will bear fruit in the future.
  6. Misinformation. iBegin does local – our internal motto is “We do Local”. That confuses people sometimes – why not focus on one thing? (because everything is related – by bringing it all ‘in house’ we can ensure much better quality and reliability throughout the entire site). Competitors haven’t helped – I’ve received some choice quotes from prospective customers where they were given totally incorrect information (the one that grates my nerves the most is that we crawl the internet for our information).
  7. Proof. This one is the hardest – people want to see sites using our data. I’ve been shown some very interesting sites using our data, but they aren’t ready to launch. We launched less than 90 days ago, our sales cycles are long, and building a website with a ton of data isn’t easy. The one benefit we do have is some launched quickly (eg, and we have our own iBegin City sites to show off).

All in all – very different from our previous sales experience (through our customers and our own stuff, we’ve pushed over $20,000,000 worth of ‘goods’ over the years).

So with all this in mind, we are going to slightly change our approach. Sales cycle, proof, and (to a certain degree) branding & perception – those are things with don’t have control over. We know we’ve been around for a while. We know we are cash-flow positive. We know that this data is mission critical important to us. But we cannot prove that immediately. Over time, people will see that not only are we still around, but we are thriving. Our sales are already up – time will only help.

In the meantime? We focus on iBegin v3 and iBegin Partners – more on that soon.

1 Response to The Long Sales Process – aka, rolling with the blows



June 9th, 2007 at 3:13 pm

Hey Ahmed, that’s really cool of you to share this insight with everyone.