The Three Eras of Commercial Software
Generally, there have been three big eras in B2B software:
- The Era of Sales (1990s)
- The Era of Marketing (2000s)
- The Era of Engagement (Now)
The Era of Sales (1990s)
Back then, all that mattered was closing deals. You installed software on your own servers. There was no cloud, no online sales. Everyone bought enterprise software in million-dollar contracts.
Sales teams reigned supreme. Big deals meant you could spend as much as you liked on shiny-shoe salespeople. After the sale, nobody worried if customers actually used the product.
The Era of Marketing (2000s)
The internet changed everything. Software went online. Buyers could enter a credit card and start right away. SaaS made software like a utility: use it, pay monthly, cancel anytime.
Lower prices and no long commitments meant each customer was worth much less. Suddenly, efficient marketing became the name of the game. Marketers raced to drive down acquisition costs to keep the business alive.
The Era of Engagement (Now)
Today, you can launch products cheaply and reach huge audiences. But options are endless and switching costs are almost zero. Free trials and freemium models flood the market.
Getting people to try your product is easy. Getting them to pay and stay is hard. That's why product engagement is now your top growth lever.
Without engagement:
- Trials won't convert
- You won't expand within accounts
- You'll miss out on word-of-mouth
- Retention will suffer
Welcome to the Era of Engagement.
