EC1 Capital

When Tech Meets Tradition - How to Sell Technology to An Old School Industry

This is how you strategise and sell disruptive enterprise tech
Cem Guralp Cem Guralp Thu 26th Feb 2015 13:47

It doesn’t matter if your startup’s customers are movie theatres, first-time mums or car-manufacturers, creating a sales strategy from scratch is hard.

But a sales strategy that speaks to a highly traditional, information a-symmetric, trillion dollar global industry that is entirely clueless about modern enterprise SaaS solutions has got to be up there with the hardest sales strategies to crack.

Two years ago, that is exactly what founders Alex Green and Jamie Carruthers took on with EC1 Portfolio startup HANDS HQ. Selling health and safety solutions into the construction industry, now the self-proclaimed “least sexy startup in the world” is in business.

In a recent chat with EC1 they told us about how they took on the daunting task of selling a modern SaaS solution to the construction industry.

Read on to find out:

  1. Why educating customers about your product is the most important first step

  2. Who you need to be talking to and what you need to be saying

  3. Before you scale, you have to formalise

First of all, the problem that HANDS HQ addresses seems obvious - that every day, certain men and women in construction spend an exorbitant amount of time completing health and safety documentation known as risk assessments and method statements or RAMS. These days, RAMS are a necessary prerequisite of any construction work, much like getting dressed is a necessary prerequisite of going to work.

However, there was no recognised industry standard process by which to create RAMS - so each company, trader and contractor had their own process that took huge amounts of time, sometimes days. To take the “getting dressed for work” analogy further, before HANDS HQ, H&S in the construction industry was like someone knitting their own jumpers when it was a cold day or sewing their shorts when it was a hot one... which is a massively inefficient way of making sure you weren’t going to get slapped with a charge of social disorder on the way into the office.

HANDS HQ built a web application that not only creates a uniform process, but also one that would massively cut down on the time spent on document creation - they say it’s up to 80%, and that larger clients can save over 400 man hours a year, thus offering massive ROI on their relatively cheap solution.

You’d think then that companies would be banging down the door, but that isn’t what Alex and Jamie found and upon a little investigation They realised that this was because of a lack of education.

1 - Education is Key:

Construction is a highly traditional industry that hasn’t really been touched by modern, cloud-hosted SaaS solutions. And while this situation does provide massive opportunity for first movers like HANDS HQ, it can also be an obstacle to adoption. What Alex and Jamie found was that because the industry standard was so old and entrenched the majority of time even their ideal clients didn’t know they had a problem, and if they did, they didn’t know a solution existed because of their lack of familiarity with modern SaaS solutions. As obvious as it might seem to us that spending hours a day on recurring documentation was a waste of time, it was not evident to people who were actually doing it.

You might say then that this was a simple case of getting a decent outbound sales team on the go, but again, they found that this wasn’t going to work because even when industry players did hear about their product, they perceived that the change in process as a threat to their livelihoods. Managers in charge of H&S were scared that HANDS HQ would make them redundant, rather than help them do their jobs - which is actually what the company is all about.

Ultimately they realised it was necessary to frame the sales conversation with an emphasis on education - it gave them a firm foundation on which to launch their sales pitch. This then lead on to their next problem, who did they have educate in order to sell their product?

Tip -  Don’t assume that your customers think like you or see the immediate benefits of your product(s) particularly when you’re a disruptive business, you’re disruptive for a reason…

2 - Identifying the target

At first HANDS HQ aimed their solution at the sole trader but it soon became apparent that it was SMEs that offered the best opportunity for their business. However, as we saw earlier they were selling into a traditional industry and so had to be outbound in their lead generation and this meant identifying the right person to target in any given company.

But without any experience of selling into the construction industry, and with each company having a different management structure, they were stumped by which person to contact about their revolutionary new product.

It turns out the answer was very rarely a single person, but two people. One is the person or manager who will benefit from the product, the other is the guy who holds the purse strings. “Get them in the same room at the same time” says Alex. “And then realise that they both need different things and talk to them accordingly” says Jamie. In doing this they were able to demonstrate the twofold benefits of their product to the people who mattered. Alex even built a savings calculator for the financials, showing how their customers were going to achieve a positive ROI within X amount of months.

The fact that Alex went to the trouble of building a savings calculator shows the importance of clearly demonstrating the gains which your product can provide. In fact for just about every B2B business this should be at the core of any sales strategy. Imagine for example that you have a new piece of AdTech that provides a higher than industry average ROI on banner ads, it would be simple to model savings provided by your product against industry averages using real data from the company you’re pitching to: “how much do you spend on banner ads per month, what proportion taken for placement fees?” might be your two questions. Being able to demonstrate savings on a case by case basis, rather than just in a hypothetical situation will add a lot of substance to any sales pitch.

Every company will have to find its own most effective way of selling into their ideal customers. For HANDS HQ this was a combination of education, identifying the right targets in a company and working out a tangible demonstration of their product’s merits. As Alex says, “there is no silver bullet” - HANDS HQ have had to work towards their success, keeping an eye on refining and improving their techniques at all times.

Tip -  find a solution to selling that works for you - if it means talking to two or more people at once, get them in the same room.

Tip -  find a way of demonstrating your product’s benefits to a customer, go further than just a product demo.

3 - You Have to Formalise Your Strategy for Scale

Once the guys knew that they had to educate potential customers, and they had found the best way to sell into SME construction companies, they knew it was time to scale their sales team. Before doing that they knew they had to have a playbook, but they found it tricky to build one because until that point they had been defining their go to market strategy.

They would come across objections and react to them as they felt and send out what they thought were the best emails they could. They had done a really good job but they couldn’t just onboard new sales people and expect them to do the same. Essentially they realised they needed this playbook - but they knew they needed more than just anecdotal evidence to build it, they needed data. So they turned to a service called Yesware to give them insights into what is the most effective time to email, the best content and the best people to contact.

Without going into too much detail - they learnt a huge amount about their process and have been able to apply it to develop a better returning process that they can roll out to new recruits.

However, they say two things about this, the first is that you need to go through periods of trial and error in your sales cycle before you get to a data collecting stage - it takes time, effort and a certain minimum volume to make collecting data either necessary or worthwhile, until you reach that point it is worth keeping an ear to the ground and interacting with your customers as directly as possible. The second is that their playbook is never static - they want the team to constantly evolve their script and their emails, to make tweaks here and there and experiment with their efforts. Jamie as their head of product is currently constructing a wiki style site to enable this, so that the sales team can constantly evolve the process, scripts objections and share knowledge, to ensure that the company is pooling its collective experience and leveraging it for maximum returns.

Tip - Always keep in mind that one day you’ll have to scale your sales team and start writing a ‘playbook’ to help onboard new recruits.

Tip - Collect as much sales information as you can but don’t rely on anecdotal data alone.

Tip -  Email is still the most popular form of communication and there are tools to help you track your performance.

HANDS HQ isan EC1 Portfolio company, for more insights from from our portfolio companies, subscribe to our blog.

The EC1 Team.



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