Sales Tests

Discovered - Data Reveals the Biggest Obstacle to Closing More Sales

Posted by Dave Kurlan on Mon, Apr 30, 2018 @ 05:04 AM  Image Copyright iStock Photos

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Humans have been waiting for thousands of years to discover the secrets of life.  Why are we here?  Why do bad things happen?  What happens after we die?  Is Heaven real?  What is God's plan for us?

While many experts have attempted to answer all of these questions, most of us lack proof. There's no data.  If we wake up tomorrow morning and suddenly there are not only answers to these questions, but science-based proof, that would be a game-changer for us.

Likewise, every day most companies try to determine why their salespeople don't close more business, why so many opportunities die on the vine, and what they need to do differently to change change their results.  They try everything!  Most leaders think it's an issue of closing skills.  It's not.  Others think it's about prospecting.  While that has an impact on the size and quality of the pipeline, it has little to do with results.  But I have discovered the cause, will show you the data, and discuss how to fix it.

Recently, Objective Management Group (OMG) integrated its sales force evaluation and its pipeline analysis.  Previously, the pipeline analysis was a separate chapter and while very revealing, the data was standalone.  OMG also expanded its analysis of salespeople's ability to reach decision makers and rather than a finding as it once was, it is now a full competency with 8 attributes.

I have reviewed several dozen sales force evaluations conducted since the change and discovered something very revealing.  Look at the bar graph shown below:

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This is VERY representative of every sales force evaluation I reviewed for this article. There is a lot going on in this graph so let me walk you through it.

This sales force averages 54% of the attributes for reaching decision makers but only 13% (green slice of the pie) are strong at this competency.  The overwhelming majority of the salespeople believe in the importance of reaching decision makers and use their skills to attempt that.  Let's focus on the first two attributes which are both Calling on Actual Decision Makers but show contradicting data.

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Let's start with the second attribute.  We ask each salesperson to identify 4 late-stage, proposal-ready or closable opportunities and we ask them 19 questions about each of those opportunities.  Nearly 90% of the salespeople met with the actual decision makers on these late-stage opportunities.  That's pretty good.

The first attribute comes from each salesperson's personal evaluation.  It shows that only 10% of them are reaching actual decision makers overall.  That's pretty bad.

Now that we have these two opposing data points, it should be clear what the problem is, both for this company and for many of the companies showing the same contradiction.

When salespeople successfully reach the actual decision makers, opportunities move through the pipeline and reach the closable stage, often resulting in a win.  However, MOST salespeople are NOT reaching the actual decision makers and those are the opportunities that lose traction and/or result in a loss.

Remember, for the most part, these are salespeople who believe it's important to reach the decision maker, have that as a milestone in their sales process, have the sales skills to reach decision makers, but still fail to reach the decision makers. 

Let's take a closer look at a few of the other attributes.

Half of their salespeople are calling on buyers at the start of the sales process.  Why are they doing that?  Nearly half aren't comfortable meeting and talking with the target decision makers, and a third need to be liked and can't push back on buyers who won't introduce them to or allow them to meet with decision makers.

Clearly, this is not the only problem that sales organizations are facing by a long shot.  However, this data shows that if they could fix just one thing today, the consistent ability to reach decision makers would make a huge difference.

It's one thing to know what the problem is and its impact on results.  However, fixing this problem is not  simple. Reaching decision makers is made possible by having advanced listening and questioning skills in an effective consultative selling process, an ability to differentiate, and being perceived as a trusted advisor.  Reaching decision makers is time sensitive in that the timing must be perfect to consistently succeed at getting the decision makers to engage.  Let me use my expert ability to combine baseball and sales for the perfect analogy.  Have you read Baseline Selling?

If the batter swings too early he will probably miss the pitch or perhaps hit a weak ground ball.  If the batter swings too late he will probably miss the pitch or perhaps hit a pop fly ball.  If the batter times his swing perfectly and squares the bat to the ball he will crush it.  Salespeople need to crush it when it comes to reaching decision makers.  They must time their ask perfectly or they will probably strike out.  You can also use comedy as an analogy where the comedy writer provides the same routine to a professional comedian and an amateur.  The words coming out of each person's mouth would be identical but the professional comedian gets the laughs because of having mastered the timing and cadence of the delivery.

This problem can be fixed but the trainer or coach providing the help must have a mastery of the nuances of how these pieces all come together.  If your salespeople can reach even 25% more decision makers, think about the impact that will have on revenue.

You can see all of OMG's data for all 21 Sales Core Competencies, by industry and even see how your company compares.

If you need some help using this tool, call us at 800-700-6507.  EXT 1.

 

Discovered - Data Reveals the Second Biggest Obstacle to Closing More Sales

Posted by Dave Kurlan on Mon, May 07, 2018 @ 06:05 AM

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Whichever way you turn, wherever you look, and whatever you listen to there is data.  Polls, surveys, metrics, analytics, analyses, white papers, graphs, charts, infographics, tables, spreadsheets and more.  There is data everywhere.  5 of my last 10 articles were based on data and I know that my regular readers love the articles that are based on data so I am writing about data again today.

Objective Management Group (OMG) recently expanded the Consultative Seller competency which represents 1 of the 21 Sales Core Competencies.

I took a look at the first thousand rows of data that came through and made some more cool discoveries that I will share below.

Let's start with the Consultative Seller Competency.  As you can see in the image below, the average score for all salespeople is 44%, which means that the average salesperson possesses fewer than half of the necessary attributes of the Consultative Seller.  As you can see from the green slice of the pie chart below, only 22% of all salespeople have this competency as a strength.  Even the top 10% of all salespeople only score an average of 65%.  This is the competency where most salespeople are the crappiest.

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The question is why are most salespeople so ineffective at this competency?  If they aren't being professionally trained and coached, that would explain a lot of the bad scores because only around 7% of all sales managers are capable of providing the kind of coaching that would help their salespeople become effective consultative sellers.  I'm guessing that even some outside trainers and coaches aren't effective enough to move the needle on this competency.  But there is more to this than meets the eye.  Let's look at what happens when salespeople are being effective versus ineffective at consultative selling.

Please look at the next image below.

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These 3 pie charts show how effective these 1,000 salespeople are at uncovering issues by looking at 3 specific sales process milestones:

  1. Whether reasons to buy are uncovered or not
  2. Whether those reasons are actually compelling enough to buy or they only created interest
  3. Whether the salesperson created enough urgency so that the prospect must buy or it was simply nice to have.

This tells us A LOT!

While 84% of these B2B salespeople are able to uncover business issues or reasons, only 33% are able to continue asking questions long enough to uncover compelling reasons to buy as shown in the second pie chart.  There is an enormous difference between a business issue and a compelling reason to buy something to solve it.  As you can see from the third pie chart, uncovering business issues leads to a condition where 73% of prospects find the offering is simply nice to have, while 12% of these salespeople leverage those compelling reasons to a condition where prospects must have the solution.  There is a huge difference between nice to have and must have.

Consider this recent article on reaching decision makers where the data showed that only the opportunities where salespeople met with the actual decision makers reach the proposal ready and closable stages.  We have a similar scenario here where the salespeople who uncover compelling reasons to buy are 56% more likely to move their opportunities to the proposal ready and closable stages.

This huge selling gap can be fixed but it isn't one of the easy ones.  Uncovering compelling reasons to cause prospects to believe they must have your solution requires advanced active listening and questioning skills, as well as Sales DNA to support its use.  The best trainers, coaches and consultants who offer their expertise in this area agree that it will usually take 8-12 months for a sales team to make the transition from where they are today to the kind of selling I described above.  However, the return on that investment of time and money is amazing!  When salespeople are finally able to sell in this manner, sales always sky rocket!

Improve Your Win Rate and Shorten Your Sales Cycle by Doing This

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Posted by Dave Kurlan on Wed, Apr 11, 2018 @ 12:04 PM

In September I wrote this article on the difference between asking good, tough and great questions.

I included examples all three types of question in the article.

There is also a proper sequence:  Good question.  Tough Question.  Great question.

You will get immediate feedback on how effective your questions are:  Your prospects will say, "Good question" when you ask one.  They will say, "Great question" when you ask one.  And they will stop and struggle before answering one of your tough questions.

Many salespeople make the mistake of preparing questions in advance. Salespeople who do that might be able to stumble onto one good question.  But great questions and tough questions must be spontaneous and in response to something your prospect already said when they answered prior questions.  

I'll share a role-play from a training program that wonderfully demonstrates what I'm talking about as well as the kind of listening skills required in order to ask good, tough and great questions. 

The role-play sheds much needed light on what salespeople tend to do on their calls, even when they have been trained to use a consultative approach to selling.  Instead of listening, they skip ahead, and rush to the close.  Ironically, the proper approach is counter intuitive. You will shorten your sales cycle, improve your win rate and gain traction by slowing down, while speeding up leads to longer sales cycles and lower win rates.

The role-play runs for about 26-minutes but please don't let that discourage you from listening.  You'll learn so much about listening and asking questions, you'll learn just how impactful role-plays can be, and you'll better understand the the most useful approach to training salespeople; powerful, interactive role-plays.

You can watch and listen to the role-play here.  The actual role-play begins at around 50 seconds in.  Early on I reference developing SOB Quality.  You can learn more about what SOB Quality means by watching this 3-minute video.

We can teach your sales team how to achieve SOB quality. Call us at 800-700-6507.

 

It’s a Trap! Why Your RFP Response Rarely Wins

Jason Jordan

How to Craft an RFP Response

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Identify whether you already have a relationship with the RFP issuer, consider if you have an RFP “Swat Team” ready to go, and don’t let excitement fool you into thinking the deal is yours. Consider whether this is truly a qualified lead and be willing to walk if it means saving valuable time and resources.

Many salespeople become giddy when they see an RFP (Request for Proposal) that falls within their sales area. Because it looks like there’s strong alignment between what a company requests and what they sell, the deal is as good as done.

Not so fast! Let’s look at this more closely and examine your chances of success with RFPs -- and how you can enhance them.

Are RFPs the Perfectly Qualified Sales Lead?

One of the first things reps are taught is the importance of qualifying new leads. A qualified lead stands a good chance of being won, but an unqualified lead may cost you days, months, and sometimes years of wasted effort.

What is a qualified lead?

1.   The prospective buyer must have a clearly articulated need

2.   There must be a purchasing timeline

3.   The purchase must have an allocated budget

4.   The buying process and its participants must be defined

The question is, how should you treat an RFP? An RFP is a document issued by a purchasing company to a select group of vendors they believe can meet their company needs. The qualification criteria listed above is typically in place. And, on the surface, an RFP appears to be a perfectly qualified lead.

But is it really?

What Is a Request for Proposal?

A request for proposal is a document issued by a company asking select vendors to submit proposals for their consideration. Vendors are usually required to submit timelines, budgets, company information, and even a project. The RFP issuer then reviews all proposals and selects a winning vendor who is awarded their business.

Is the Deck Stacked Against You?

How many times have you and your fellow reps reacted with excitement when an apparently winnable RFP hit your desk? How many hours did you spend assembling a team to write a proposal, gather information and data, answer the questions, revise and review, and finally submit the RFP, believing it would bring you a windfall? And how many times have you failed?

For example, one day, I received a call from the head of sales at a large manufacturer. He had read a piece I’d published online and was interested to learn if my company could help him define a new sales strategy for his team.

Over the next several weeks, my team defined the scope of work, created a project plan to help his sales force, assigned resources to the effort, and selected a kick-off date. Prior to the kick-off date, however, I received an alarming call. He’d been informed the project must be put ‘out to bid’ to at least two other vendors, because its total cost exceeded $500,000.

Apparently, our “slam-dunk” would have some competition. A vendor-selection committee had been formed, and we were not invited because, “There’s no need to worry,” said the head of sales. “We’re still going to do this project with you.

Despite my protestations and sense of panic, my contact assured me, “Just sit tight. Give me two weeks, and then we’ll pick up where we left off.” True to his word, we were back on the telephone two weeks later rescheduling the project kick-off meeting.

What happened during those two weeks?

Our client had issued an RFP and received proposals from three consulting firms. Even though we were not the lowest bidder, we were the successful bidder because, in the words of my contact, “It was your project. I just had to jump through some hoops to make it work internally.” In other words, the entire RFP process was essentially a sham.

This is a great story if you’re the beneficiary of these shenanigans, but not if you’re the loser. The other three consulting firms had entered an imaginary contest to win an unwinnable project. Imagine the time, energy, and resources expended by all in these two, short weeks.

Before Submitting Your RFP Response, Remember These Lessons

1. RFPs are hard to evaluate. RFPs might have a defined need, timeline, budget, and buying process -- but they’re much harder to evaluate than regular leads.

2. RFPs might look like highly qualified but, often, they’re not. When presented with an RFP, try to talk yourself out of responding to it, rather than automatically assuming you should. Win rates are usually against you. “Losing” the RFP by failing to bid can be a gain, because you’ve not wasted precious resources.

3. No existing relationship with the issuer? You’ve probably already lost. And you’ve definitely lost if the RFP response you send is the first time the purchaser is seeing your name.

4. Your company’s online presence and thought leadership is vital to successfully influencing purchasing decisions. Successful content marketing is key to influencing decision makers, most of whom are already halfway through the decision-making process before receiving your response.

5. Create an in-house RFP process and RFP response “swat team” to quickly and efficiently respond to requests without causing an unnecessary drain on internal resources.

6. Don't expect a successful sale. It might seem like the stage is set for a successful purchase. But it’s not necessarily set for a successful sale. Don’t let the excitement of an inevitable purchase fool you into believing it’s your inevitable sale.

I'm not saying you should never submit an RFP proposal, but I am saying there's no golden ticket in sales -- and that extends to RFPs. Consider whether this RFP is a realistic goal, and whether it's the best use of your team's time before crafting a response.

Originally posted by Hubspot