As part of the ritual of examining local commerce and SMB Saas strategies, Localogy goes right to the source: SMBs themselves. How do they feel about marketing and operational software? What features do they want? And how has their hunger changed in a pandemic? This is all a moving target.
Localogy’s Modern Commerce Monitor (MCM) Wave 6.1 answers these and other questions across SMB SaaS, which we preview in this Benchmark Bytes series. After examining SMBs’ areas of desired software improvements, we switch gears this week to look at their software sales interactions.
Specifically, in what software verticals are they having the most in-person interactions in the buying cycle? This factor has shifted a bit in the Covid, era but appears to be returning to pre-Covid levels. This is especially true for SMBs purchasing POS software (39 percent) and payroll/HR software (38 percent).
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Data Dive
Going deeper, a few other insights jump out from these figures.
– As noted, in-person software sales to SMBs are bouncing back to pre-Covid levels.
– This can be seen in the year-over-year trending for in-person software sales interactions, which saw a dip in Wave 6 (February 2021) in every software category tracked.
– This rebound is category-dependent, with many functional softare areas approaching pre-Covid levels… while some have exceeded pre-Covid levels.
– Categories trailing pre-Covid levels (but still up from 2021) include communications & technology, POS & payment processing, and finance & operations
– Conversely, categories now exceeding pre-Covid levels for in-person sales interaction include marketing & advertising solutions, payroll & HR.
– CRM lies exactly on par with pre-Covid levels of in-person sales interaction.
– When looking at the variances in these software categories, the question is if there are any inherent attributes that have led to greater or less in-person sales.
– In some cases, the in-person sales that have sustained to greater levels include those that have more complex or specialized functions, such as finance & operations.
– On the other hand, categories that have a simpler orientation have bred a greater propensity towards self-service, including marketing and advertising.
– Drilling down on one of the above examples, marketing & advertising has seen a large-scale shift towards self-serve procurement over the past decade
– So these were functions already primed for this shift… Covid simply accelerated it.
– Other software categories will always be more conducive to in-person sales, and will continue to boomerang back to pre-Covid levels.
– The key for software providers is to figure out where they are on that sliding scale and optimize sales strategies accordingly.
Time to Shine
Stepping back, SMB online marketing – website-based or otherwise – continues to grow rapidly. SMB SaaS startups and online services providers are correspondingly thriving as it continues to grow as a leading subsector of the broader SaaS universe. There’s a long-tail opportunity at play.
Meanwhile, new SMB SaaS users could represent permanent adopters – a concept that’s accelerated in the Covid era as SMBs are forced to boost their digital transformation. This sends them into the arms of SaaS providers to accomplish a range of marketing and operational functions.
We’ll return in the next installment to go deeper into Localogy original survey research. That will include SMB goals and success factors. Let us know what additional insights jump out at you from the above data, and stay tuned for more breakdowns in our Benchmark Bytes series.
