We work with a lot of Tech firms selling to the Financial Services industry.
Those who sell to FS firms know that “the sales cycle can be long & conversion rate low”.
But is that true? Is it, in fact, a limiting belief?
Selling to large enterprise clearly doesn’t have to be a ‘dark art’.
There are processes & structures you can put in place to maximise your rate of success. Companies with a formal sales process see up to a 28% improvement in revenue. It’s time to stop the excuses.
So what are the 3 most common mistakes we see when firms are approaching the Buy & Sell-side?
1) Carrying bias from your own experience
Most FinTech founders have previously worked in Financial Services. The inspiration to their proposition generally stems from the pain they experienced themselves. This should be their weapon. They truly understand the value of the Tech.
However, this often ends up meaning that the founder(s) may have a pre-determined view of how the technology should be built & sold.
In many instances, by the time the product is commercially ready, the market will have moved on. Competitors will have developed & enhanced their proposition.
Organisations that you are selling to will have also matured, so the original proposition & product may no longer be relevant.
2) Thinking all FS firms are the same
The problem with the terminology of Financial Services is that it is an umbrella term.
The Buy-Side and Sell-Side are vastly different. Too often, Tech firms approach the segments in the same way.
This is the number 1 mistake we see in the market. This impedes their traction.
By approaching the different segment of the market in the same way, all you are doing is demonstrating to the market how little you understand about their specific values & challenges.
This is even truer when firms are just selling to the ‘Buy-side’ or ‘Sell-side’. Within the Buy-Side itself are many nuances. Traditional asset managers, hedge funds, sovereign wealth funds and private equity funds (among others) should be treated differently. They all have very different drivers, pain points & appetite for Tech adoption.
Similarly, on the Sell-Side, a Tier 1 Bank is entirely different to a challenger bank. They have completely different challenges & expectations, which means just because your product may be relevant for one group, doesn’t necessarily mean it is for the other.
3) Approaching the market with a one-size-fits-all approach
Too often, Tech firms selling to FS end up approaching the market in a very generic one-size-fits-all approach. That is wrong – all FS firms are not the same.
So what does that look like?
The generic sales approach:
When we dig into Tech firm’s CRM systems & review their sales pitches, we see some common mistakes. On average, only 24% of sales emails are opened. And yet, firms still blast the market sending the same, generic, cold-emails. Poorly copy & pasted, with nothing but the firm’s name changed. When a prospect decides to open your email, that first point of contact is critical & no one is impressed. Generic messages aside, no time has been spent working out who exactly the buyer is within the organisation.
This is then followed by presenting the same demo & sales pitch, regardless of the audience. This too is wrong – you need to shape every pitch to the prospective client’s specific challenges.
On the other side, only 37% of companies respond to leads within an hour. Why is the focus on cold contacts rather than genuine leads & not cold contacts?
The same old pricing model:
Pricing is another area where many firms selling to the Financial Services industry fail to take into account & recognise the complexity of these organisations.
Many of the large banks & asset managers expect a modular pricing model. This shows them that the product has the ability to be tailored for their complex organisation.
On the other hand, a scaling hedge-fund who can’t take the hit of a fixed cost, may prefer a variable pricing model.
Approaching them with a simplistic, one-size-fits-all pricing model will inevitably end the conversation at pace.
We are consistently shocked by how often we see firms making the same mistakes selling to FS.
Unconcious bias. A one-size-fits-all approach. Generic sales pitches and pricing models.
Whatever it might be – there is a need to question everything you do. Why do I do it like this? Is this a 10/10? Is this what the market actually wants?
Without a truly challenging perspective, your B2B sales within FS will never push pass mediocrity & your conversion rate will always remain low.