Online sales · Business model

What is your experience building a self-service business?

Mike Whitfield Sr. Software Engineer, EPAM, Google

July 16th, 2015

A self-service business is something most of us know as a "SaaS" business, but it doesn't have to be.  In our case, we want customers to come to our website, swipe a credit card, and they are granted access.  Our alternate model is enterprise sales where we are in the game of a 6m sales cycle for 1/2M or multi-million dollar pricepoints.

Our short-term pro/con list for self-service might look like this:

PRO
* self-service is a legitimate product
* self-service incentivizes building a kick-ass engineering team
* self-service requires no huge sales effort
* self-service sells an already built product, less stressful development cycles and truer engineering

NEUTRAL
* marketing mix becomes more digital
* emphasis becomes on deal flow, not customer quality unless there is a social aspect to the service

CON
* self-service is way more costly to build
* price-points usually must be lower

What does the landscape look like for a self-service model once you've gone to market?  What is the competitive aesthetic like?  Is your experience with it generally good or bad?  What size companies are you targeting or are you targeting individuals (N/A if it is a personal use VP)?

John Seiffer Business Advisor to growing companies

July 17th, 2015

You're trying to tell people how they should act when they buy your product. Good luck with that. 

You can tweak your feature set, change your messaging, adapt the UX, but ultimately the customer decides if and how they want to interact with your company.

You'll probably be more successful learning about how customers see their problems, how they prefer to solve them, what their purchasing process is. And then building a company that serves the customer where they're at.

I've lost lots of money investing in companies that didn't understand that.

Anonymous

July 18th, 2015

It's very difficult because your are servicing people are people are always fatally flawed -- flaws are a tough thing to cater to. The key to our profitability was to segment our clients and provide different levels of service to the most profitable, best advocates of us.  Else problem clients who are not so profitable would chew our profit up, leaving us little time to service your best accounts, who would then go elsewhere and, in a downward spiral, we would be left with the worst of the lot -- don't do it!  We go all out for our top 20%.  The bottom 30% we look to commoditize our services to, price up and or we give them away.  It feels so good to "fire" an unprofitable difficult client!   And so amazing when your top account believes in you enough to introduce your firm to his or her top contacts.

Zvi CFA Senior Quantitative Analyst | Data Scientist

July 20th, 2015

It depends on what your special strengths are. 

If you excel in user experience and developing simple tools that appeal to a wide range of people, as well as informing the public of your service, a "self-serve" is better.

However, if you have a network of contacts at large companies, or some special ability to network, as well as an ability to quickly and robustly build custom solutions, go with the "solution" model. 

If both are options, figure out what would make more money and go with that.