A key way to do so is knowing when to stop wasting your time.
By Julie Hansen
Time is one of your most valuable resources in sales. And you need to protect yours if you want to be successful and sane!
Average sales close rates hover around 20%. That means 80% of a salesperson’s time, four times out of five, is wasted. Sometimes the business goes to a competitor, but many times it goes to “no decision.” In other words, the customer doesn’t say “Yes” or “No”—they simply decide not to do anything.
You can improve your sales close rate dramatically by eliminating the primary reasons that deals go to a “no decision.” There are three reasons deals end up in this holding pattern.
- No critical issue. The customer may recognize there is a problem, but they have other problems as well. They don’t see how the problem that your product or service addresses impacts their primary goals or challenges, or the issue has not risen to the level of something critical.
- No sense of urgency. The customer has lived with the problem for a long time, they’ve probably put some duct tape on it, and there’s no compelling reason to address it for now.
- Not enough return on investment. Yes, they’d like to fix the problem, but they don’t think there’s enough return on their investment to do anything about it.
If you can address these three issues sufficiently with your customer, you stand a much better chance of gaining a yes, or even a no, which is better than pursuing a deal that is never going to materialize.
The most effective way to address these issues doesn’t happen during your sales pitch or meeting. It takes place during your preparation. No brochure, no story can replace the need for a thorough understanding of your customer.
That’s why discovery is so important. Without vital insights into your prospect’s interests, challenges, or business, you’re at risk of wasting your time.
Here is what you want to identify in discovery:
- Critical challenge or goal. What is the customer’s current goal or challenge they want to address—and how is the specific problem you address connected to it? For example, if your customer is a company and their goal is to grow their business by 10% and you supply steel casing, you might need to help them see how not always having an inventory of casing on hand can negatively impact their ability to grow.
- Impact/cost of delay or no decision. Most salespeople know that it’s important to uncover the customer’s discomfort in delaying or arriving at no decision. But great salespeople know how to uncover the impact of those feelings.In other words, how much does putting off or making no decision hurt? Oftentimes customers haven’t connected the dots themselves, so you must help them figure it out. Present your product or service’s impact in terms of time, money, and resources. These you can use to show the customer a return on their investment.
- Customer’s timeline. Whether or not your customer has a date by which they need to have a solution in place gives you a good read on their sense of urgency.If there appears to be no real timeline, talk through potential “what-if” scenarios with your customer. What would have to happen for them to pull the trigger? If those events seem unlikely, you may want to reevaluate the opportunity, dig deeper into the impact, or find out what would have to happen to make it a greater priority.
- Additional decision-makers. Many sales today involve multiple decision-makers as well as key influencers who can have an effect on the buying process.It’s important to know the titles of who you are meeting or talking with so you can be prepared to speak directly to their interests.
- Competition. Know who your competition is ahead of time so you can be prepared to address key differences and competitive advantages. It’s also helpful to know if there is a favored vendor. Are you being brought in just so the customer can say they did a fair bidding process?
Find out where you stand beforehand so you don’t end up wasting your time on a deal that’s all but decided upon.
If any of the top three reasons for deals going to no decision are present, it’s a good idea to pause before investing a lot of time putting together a pitch or responding to a customer.
If you’ve tried to get the information discussed and come up with too many gaps or resistance—again, pause.
If you feel like you’re a mere substitute and being used to compare, you may want to walk away.
Ultimately, you have only so much time available, so use yours wisely. And that may mean making some hard short-term decisions to achieve long-term success.
Julie Hansen is a professional sales trainer, speaker, and author. She authored the book ACT Like a Sales Pro in 2011 and has been featured in Selling Power, Entrepreneur, and Sales and Service Excellence magazines. She can be reached at firstname.lastname@example.org and www.actingforsales.com.