Discounts can help win deals, shorten sales cycles, and delight customers. But discounts also have a dark side, as they can devalue your product in the eyes of your customers — leading to lower lifetime value, higher churn, and less willingness to pay. For SaaS businesses with recurring revenue, the wrong B2B discounting strategy can truly be the terrible gift that keeps on giving for the sales quoting process. 

In this series, we’ll take a bird’s eye view of discounts, and look at three essential factors that every SaaS business should address when creating a discounting strategy – 1. Establishing Value, 2. Discount Design, and 3. Quoting & Discounting Enablement (this article!)

Many think of quoting enablement curriculums as having three main (and often separate) buckets: Product, Systems, and Methodology. In other words, it’s what you sell (product), where to keep track of your selling (systems) and how to sell it well (methodology). Assuming your reps know your products and the sales quoting process, your next step is enabling them to use the quoting tool if you have one. 

For many RevOps pros, a quoting tool is viewed with hesitance – what if pricing changes? Is it going to hurt or help sales velocity? Is it going to be a heavy lift to implement? What if every discount is custom?

The reality is that the sooner you put in quoting, the better a company’s journey (this is where having a flexible, agile quoting system and process that can adapt to changes matters).  Setting up a flexible quoting process is what makes your discounting strategy gold and speeds up your sales process. These are three considerations as you set up your quoting process so that your sales team loves the tool and sees it as an asset to their sales process. If you have put in the right tool, which is both intuitive and in clear alignment with your go-to-market strategy, this part of the enablement should be easy. This will allow you additional enablement time to focus on a more crucial area: Discounting enablement. 

“The sooner you put in quoting, the better a company’s journey.”

An often-neglected and crucial topic in this perfect alignment is enablement on discounting philosophies and how to get a deal approved. Your discounting philosophy should be part of the quoting tool itself allowing for quick quoting and approvals.

Your sales team needs to know (very simply) which products should be bundled together, can be broken apart, and what potential add-ons they should be offering when putting pricing in front of prospects.  The products in your quoting tool can have fancy SKU names (“Super XYZ Deluxe w/extra sauce” and “XYZ Enterprise edition”), but these names should be clearly and intuitively recognizable by prospects and reps. If it’s not directly described in the quoting system, it should be. If tiered or dynamic pricing and discounting strategies aren’t clearly described (for both reps and prospects), they should be. If that level of pricing configuration and clarity is not a possibility within your quoting tool, you can at least give your sales team a cheat sheet to help them know what to select and when (and what discount is appropriate).

“Even if your quoting tool has fancy SKU names, they should be clearly recognizable by prospects and reps."

Navigating a quoting tool can often be a point of confusion for salespeople. Quoting tools are often designed by Operations people who oftentimes, but not always, are a little more left-brained than most sellers. So it seems obvious to the designer, but a high-energy seller may miss the nuance and require a lot of help to navigate. (I have heard many Operations and Enablement professionals express frustration with sellers “not getting it” — and then in the same breath tell me how amazing the enablement program is for quoting. Which one is it?) I recommend making sure your sellers at all stages of tenure are involved in the design and the training design for quoting to avoid this frustration.

“Quoting tools may seem obvious to the designer, but a high-energy seller may miss the nuance and require help to navigate.”

Assuming you have done your discounting design appropriately (See Part 2 of this series), do you teach your sales team what to do in the sales cycle to avoid getting caught off guard with end-of-quarter discounting requests? Have you had a sales rep tell you that they didn’t know the CFO had to sign off on a discount? Or that they didn’t know there was a procurement department? Those are great coaching opportunities, and you can make sure they understand the buying process going forward by asking the right questions. But let’s give the benefit of the doubt to the seller here and say we are truly at the final negotiation stage. 

The seller put initial pricing in front of the buyer and they asked for a discount. If the seller hasn’t properly framed a strong business case for your product, the prospect now sees your product as a nice to have (rather than something they desperately need) — and you have another coaching opportunity on your hands. No amount of discounting is going to change the buyer’s perception. 

But let’s assume for this scenario that the seller has established the value of your product. They asked the right questions during the sales quoting process, clearly demonstrated the value of your product, and the prospect understands and agrees with that value. 

In that situation, you need to teach your sellers to use the quid pro quo approach. Arm them with a list of things they can offer and a list of things that hold value to the company to ask for in return. Suggestions of things to offer can include: 

• Discounted implementation fees
• A free month or two added to the contract
• Discounting high margin components of the offering
• Deferred payment terms
• Small discounts on lower margin items (this should go at the bottom of the list) 

“Teach your sellers the quid pro quo approach: Arm them with a list of things that can offer, and things they can ask for in return." 

Get creative to put a whole list of things to offer ahead of discounting recurring revenue. Things they can get in return might be references, white papers, logo usage, product surveys, etc. 

Once sellers have their lists ready to go, teach them to hold their head up high and tell their prospects: “If I give you this (insert offer here), will you agree to give me (something in return)?” 

And then command them to not say a word. (Seriously.) It’s awkward, but they must let the prospect respond before going any further. If the prospect says no, try another combination. But If the prospect says yes, get it written up and celebrate. You’ve taken a step toward a future that doesn’t rely on deep discounts. And that’s good for sales, good for finance, and great for the long-term viability of your company.

Note: This is part three of a three-part Discounting Strategy guide.  See the beginning of the article for the other two chapters. 

If you would like to review prior articles in the series or share them with others, you can download the full series as an eBook.