As Millennials Rise to Prominence at Work, Challenges and Opportunities Abound for B2B SaaS
A big change in demographics is well underway in the United States. But its effects on revenue teams at B2B SaaS companies are not necessarily obvious.
Among the changes we see at work every day,
This article looks at key ways the demographic changes are likely to affect revenue teams in the next 5 to 10 years.
Start with the obvious: Gen Xers are replacing Boomers
It’s no secret that Baby Boomers are aging out of the U.S. workforce. They’ve been doing so for almost a decade.
But it may come as a surprise that they’re doing so at about 10,000 a day, and they’ll continue at the pace for the next 9 years.
Meanwhile, Gen
All Millennials are now of working age, and they’re fast joining Gen
Mapping the sea change
Demographic data tell a story. But it’s hard for many of us to visualize the implications of data presented in rows and columns.
So let’s look instead at charts that map the march of generations across the labor force.
Figure 1 shows the relative position of Boomers, Gen X, Millennials, and Gen Z in the workplace in 2020.
Figure 1. In 2020, Boomer retirements open opportunities for Gen X,
and Millennials age into more senior roles
The generations appear in the red rectangles that move sequentially across the graphic from left to right.
The horizontal axis shows the age of workers from 0 to 95 years.
Typical working years, from about age 20 to about 65, appear as rectangles in light blue.
The years at which people move into senior management roles, from about age 35 through 65, appear in the slightly darker blue rectangle.
The pre-work years before age 20 and the post-work years after age 65 are in gray.
As Boomers retire, Gen X moves to the fore
In
At ages 41 to 55, Gen
They have also become the senior leaders of most SaaS revenue teams.
How Boomers and Gen Xers see Millennials
The goal here is not to reinforce stereotypes.
Rather, it’s to explain perceptions in the workplace that affect the way generations interact.
The leading half of
And, unlike Boomers, most early Gen
Fairly or not, stereotypes of Millennials persist
A Boomer sales leader recently said he’s stopped hiring Millennials as enterprise salespeople.
Why?
“They’re on the phone for a few minutes, and then they want to play ping pong to recharge their batteries.”
This sales leader said he now hires senior salespeople who know how to get things done “the old-fashioned way.”
Such characterizations of Millennials may be grossly exaggerated and unfair. But they persist. And the perceptions influence both hiring and selling behavior.
One Gen X Saas salesperson recently complained that several Millennial prospects had ghosted here. They’d done so after she’d spent many hours helping them through a complex buying decision.
“In my 20+ years of selling, no one has ever ghosted me until recently. Now suddenly it’s happened a few times. Millennials seem to think that’s OK.”
To get on with Millennials, praise them. And don’t expect them to read.
A Gen X sales leader told me she finds it hard to connect with Millennial buyers. They are likely to be transactional in their relationship with
To build relationships with Millennials, she says, she
That usually works, she says maybe a little bitterly, because Millennials have received high praise from their helicopter parents and well-meaning teachers.
They’ve learned to welcome praise even if they haven’t earned it. And now they crave it in the workplace.
Others have noted that Millennials don’t read as much as their predecessors. They prefer to collect information through social media, online video, or audio formats.
Oh, what a world. What a world.
How Millennials are changing the workplace
Meanwhile, the fast-growing horde of “digital-native” Millennials are ushering in a transformation of workplace attitudes and behavior.
Now at ages 26 to 40 years, they are fast aging into positions of influence in senior management.
Millennials’ buying preferences and behavior are becoming important enough to influence the way SaaS companies sell their products.
Millennials have their own way of buying software and other high-consideration products at work.
You can read about their preferences in The B2B Millennial Buyer Survey Report from the Mx Group. [This is a downloadable PDF. To get it, you must fill out an online form.]
Among the report’s key findings are these:
- Many B2B sales and marketing organizations incorrectly believe Millennials don’t yet hold influential buying roles for major purchases.
- Over traditional sales and marketing content such as white papers, Millennial buyers prefer peer reviews, messaging apps, and social media as information sources.
- Millennials especially value case studies involving “people like me.”
- Millennial buyers expect help from salespeople in overcoming hurdles in the buying process. They want help in removing complexity, speeding up the buying process, and building Millennials’ credibility with senior management.
- They want tailored, streamlined digital buying experiences, even for complex buying decisions.
Gen X-led sales and marketing organizations may not be ready for these changes.
Many Gen Xers share Boomers’ discomfort with social and digital selling. They prefer to get on the phone or meet in person.
Apart from bringing great intelligence and energy to management, Gen Xers haven’t introduced many radical changes in the way SaaS businesses go to market.
Like the few remaining Boomers in sales leadership, many Gen Xers are subject to criticism that their selling hasn’t changed as much as buying behavior has.
GenZ take junior SaaS sales roles, often as business development reps
Gen Z are just beginning to appear in the workforce. Their numbers in SaaS businesses are still relatively small, and they occupy mainly entry-level or junior roles.
They don’t have much influence on buyer behavior. But they are the primary candidates for work as business development reps (BDRs) or sales development reps (SDRs).
Note to Boomers: The young people spamming your email inbox with sales pitches are probably not Millennials. They’re more likely Gen Z.
What 2025 looks like
Now let’s advance the calendar five years, to 2025.
Figure 2. In 2025, Boomers
Most Boomers have aged out of the workforce, though many retire well beyond age 65.
The youngest Boomers are 60 years old. That leaves SaaS sales teams mostly empty of Boomers, because few salespeople stay in senior positions beyond age 60.
The successful ones have made enough money to do something else. And the less successful ones have a hard time finding a job in sales.
On the customer side, in contrast, many Boomers remain in very senior decision-making roles. They still influence the way their companies buy software.
Gen
Millennials control the software-buying process
On the customer side, Millennials now hold enough sway that SaaS companies must sell the way Millennials prefer to buy.
B2B SaaS companies must also convert their sales and marketing to a highly digital model. They must offer customers a choice of how they want to engage.
Salespeople are just one of several sales channels. Despite their reluctance to cede control, they are not necessarily the dominant one.
Marketing controls the digital sales channels because marketers have the skills to create and manage digital content.
Sales and marketing must work together closely, as members of
Salespeople must earn the right to engage with customers. They must offer real value in the customer’s eyes.
Many Millennials now hold senior enterprise sales positions at B2B SaaS companies.
Gen X and Millennials rule the world
In 2030, the landscape looks even more different.
Figure 3. In 2030, Gen X and Millennials occupy nearly all senior decision-making roles. Most Boomers have left corporate jobs.
Early Gen
Gen X now shares decision-making influence with Millennials.
The two groups together run the show at both SaaS firms and their customers.
Early members of Gen Z, now at age 35, are old enough to join the ranks of senior management. Their influence is rising.
But we
It’s probably safe to speculate that Gen Z will be more like Millennials than not.
B2B SaaS revenue teams face major transitions
The demographic shifts we’ve just reviewed, along with ongoing changes in technology, constantly revise the ways companies buy high-consideration SaaS solutions.
In this environment, SaaS companies today face three challenges:
- For at least eight more years, Millennial and Gen X salespeople must be able to sell the way Boomers prefer to buy.
- Within the next five years, SaaS companies must adapt their sales and marketing to the way Millennials prefer to buy.
- SaaS companies must replace Boomer sales reps, who are retiring in droves.
To replace retiring Boomer salespeople won’t be easy.
Over time, Boomers
That’s because members of the C-Suite didn’t use social media to buy enterprise software. And few C-level executives had social media accounts. So it was a waste of time to
The C-Suite no longer buys software the way it used to
Most boomers and many senior Gen X salespeople remember when the C-suite bought most enterprise software.
It was essential in those days to connect to C-level executives. Prevailed sales wisdom suggested it was a waste of time to engage too much with end users, outside of the required software demo.
Now the software-busing process is more democratic. We’re in what some call the age of the empowered end-user buyer.
For B2B SaaS companies that follow a product-led growth (PLG) strategy, adoption starts at lower levels of an organization.
Successful SaaS vendors must accommodate these and other big changes.
Opportunities for B2B SaaS companies
With change always comes opportunity.
In the next decade, the big opportunity will be for B2B SaaS providers to adapt their revenue teams to the new realities of the marketplace.
Increasingly, the customer’s buying experience is more important the software you sell.
Software features are easy for competitors to knock off. That’s why most software products eventually arrive at par in features and functions.
When you sell intangible products, the buying experience
Often the customer’s buying experience is more important to them than your product’s features and functions.
The top B2B SaaS companies of the coming decades will be the ones that achieve lasting competitive differentiation by offering a superior customer buying experience.