Buyer Categorization By Sales Method

Self-serve vs direct sales

If you're building a tool that is going to be sold to a relatively small audience and you're going to reach directly out to someone in that business to do the sale, that's a direct sale. Whereas if you're building a tool that could be used by a larger audience, and they will probably find you by looking for you on an internet search or some kind of advertisement, then that is a self service sale.

A direct sale is sometimes also known as an 'Enterprise' sale, whether people are selling to an enterprise or not. Very often, the enterprise or direct sale is sold at a much higher cost and has a longer sales cycle. As we'll see later in the book, this means that there is a high cost of acquisition, but also a high lifetime value.

An example of a direct sale from earlier in the book is the case of our Dr. Paul who was selling to hospitals. Sales to hospitals can go through sales channels, but very often it is going to be done on a personal level, even if there is an intermediary sales channel. In the words of so many enterprise salespeople I have met over time, "You have to have boots on the ground."

When it comes to a self-serve sale, an example would be something like Slack. If you don't use it already, you probably heard about it through some article, or a friend, or an ad somewhere online. The reason for this is because the problem it solves applies to you and so they make sure it's on your radar. When the Slack team was working on their marketing campaign, they could easily create a list of a ton of companies that would be buyers of their system. But when comes to Dr. Paul, getting in front of a ton of hospital CEOs to ask questions was much more difficult, and he couldn't query them in the same ways.

Validation Process

Because of the difference in accessibility, time availability, interest, and sales channels to the different kinds of customers, there are a couple different methods of validation that you can use. The more validation you do, the better, so doing BOTH validation processes is best, but sometimes only one or the other is really feasible.

Whether you are doing an enterprise software sale for hospitals or building another marketing app, if you don't get the validation you need in so far as: