Proof of Concept (POC)

Nowadays, buyers want to try before they buy. This is particularly true in B2B SaaS. So, a great way to convert prospective customers (especially big ones) is by offering a Proof of Concept, also referred to as a trial, or pilot project.

In this article, I will walk you through:

• What is a Proof of Concept?
• When to offer a Proof of Concept
• Proof of Concept checklist

What is a Proof of Concept?

A Proof of Concept (POC) is a trial run of a product to explore its feasibility in meeting a prospect’s needs. It usually takes place with close involvement of the company and serves to show:

• How the product will help the prospect and provide the promised value.
• How much the prospect will need to budget for ongoing use of the product in production.
• How the company can address any stumbling blocks, such as technical limitations (e.g. compatibility or integration issues).
• What extra resources or features might be needed to support the full use of the product.

Typically structured as a limited trial, a POC doesn’t have to involve all the functionality of a product. It’s often used simply to discover if the product meets the customer’s bare minimum of requirements, or one specific requirement.

It can be paid, discounted, or completely free.

If the POC works out, then the customer may go on to purchase a full subscription or license. What’s nice for the sales team is that this next process is naturally sped up by having already set the groundwork.

For our venture-backed B2B SaaS company, we converted 80% of our POCs to closed-won customers. In most cases, if you can get a customer to the POC, the deal is yours to lose. As long as you deliver on your upfront promises, they will sign the contract at the end of the POC.

A Proof of Concept can also help sales specialists discover if the prospect is actually a good fit, and can be very useful to the deal desk in coming up with a solid sales contract that aligns with the company’s growth and financial goals.

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When to offer a Proof of Concept

Here are a few examples of when a company might offer a trial or product demo as a Proof of Concept:

• The prospect isn’t willing to commit to a long-term contract yet without hands-on testing.
• The prospect doesn’t know what pricing or usage tier will fit their use case best.
• The prospect isn’t convinced that the product will solve their problem, improve their KPIs, or bring as much ROI as they hope.
• The prospect desires a gradual onboarding process to allocate resources, perform integrations, or train staff on the product before going full bore.

Proof of Concept checklist

The business goal of a Proof of Concept is to convert nearly-there leads into sales. As such, it should be treated like a sales process, closely following how the prospect engages with and evaluates the product during the trial. These insights can be leveraged later to more easily win the customer over.

Here is a brief checklist to ensure your POC is effective:

• Demonstrate value quickly: Get relevant tracking and metrics in place to show the concrete improvements or benefits of using your product. This can be one or two KPIs or OKRs that matter the most to the prospect, based on sales or pre-sales meetings. This is critical. We called it our success criteria.
• Identify issues and respond: Any number of technical, logistical, or operational issues with the product in testing can be a dealbreaker. Address these now, not later. Use the POC to show them how responsive your team will be. This experience simulates what it will be like to be a customer.
• Place a time limit: Allowing too little time is useless in gauging real-world impact, while too much time can waste resources on prospects that don’t lead to sales. 14-30 days is what we used. In some rare cases, we extended these to the upper limit of 60 days for very large customers. But otherwise, keep them short because you will unnecessarily drag out your sales cycle, which ultimately increases the cost of acquisition for your company.
• Collect feedback: Solicit the customer’s feedback on their experience and take this into account when coming up with the final contract.
• Moving forward: Once the trial is over, make it easy for the customer to sign on for the full product (including saving all configurations and data entered during the trial).

Even if the Proof of Concept doesn’t lead to a conversion every time, the insights gained through the process are priceless and can be added to your Voice of the Customer Template to help you pinpoint the real needs of your customers.