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What do you know about your prospects?
During the last few days of the quarter most sales reps completely forget about prospecting and are focused on closing the few deals that they have in the pipeline. In order to meet revenue forecasts and numbers, management is forced to provide steep discounts and give away the product in order to attain revenue targets. At the end of the quarter when all discounts have been exhausted, management discovers that the discounted deal will not be closed and has been pushed out to the following quarter.
This is such a frequent occurrence that some companies close over 90% of the business in the last 5 days of the quarter. As a result they train purchasers to only negotiate during the last month of the quarter. Old customs are hard to change for both the sales reps and the purchasing agents. Sales reps and management are usually baffled as to why the deal did not occur and do not understand the reason why they gave the ship away with steep discounts. The lucky sales reps gets the order. For most reps the deal does not go through and they have revealed the true desperation and value of the product to the buyers for the subsequent quarter.
The fundamental reason for this is that sales reps and management did not spend the time during the previous months gathering information on the prospect’s needs and wants. Most sales reps present a proposal to a prospect without first clearly understanding the problems that the client is trying to solve. They fail to understand the real reason and incentives that the prospect has for making a decision. Why should they buy now versus next quarter?
What is the compelling reason to act now?
In most organizations prospect knowledge is more than just knowing the desires of the company. Purchasing decisions are not made in silos but rather a number of folks in the organization, each with their own set of incentives, needs and wants, influence and dictate the priorities of the company. It is important not to only identify the various players in the decision process from the users, coaches, gate keepers, financial players and decision makers, but also to make sure that the sales reps have an in-depth knowledge of each player and collectively with management work to address the needs of each decision influencer and receive by off from each individual and silo.
Before you start discounting products for the Friday night end of quarter special, take a look at what information has been attained up to this point. Has your sales staff identified what problems might be solved by your product or service for each member and each silo involved in the decision process?
During the prospecting phase did your sales reps engage all the necessary players and identified each business drivers and personal needs of each influencer? If so what are the needs and wants of each of them? Was that confirmed with the prospect or is it simply guessing?
How does this need compare to other needs and wants of the organization in terms of priority? When a decision maker or influencer acknowledges a need you still have no guarantee that this is immediate need. Maybe it is on the product road map for the future, but that future may not be this week or this month or even this year.
The timing for the deal is dependent not by the Friday night end of quarter special, but rather by the desire of the organization to solve its business challenges. Because of internal inter-dependencies, each silo within the organization may have different answers depending on who you ask this question from. In the case of the users it may be immediate, but for the Information Technology department it may be 6 months out and for the business line owner or the decision maker, the purchasing may be 3 quarters out since it is dependent on IT for support and they would like to have a working pilot in place before sign off. Just because the users have immediate needs it may be that the finance decides to put off the decision to the following year due to the lack of budget.
Make sure that the sales team identify the budget timelines and deployment schedule from each influencer rather than assuming that an organization acts in unison.
Keep in mind that organizational plans change for each silo and decision maker over time. No successful company has a 2 year, 5 year and 10 year plan in place. The communists tried this but it failed. As time passes, the shifting needs and desires of the company change and your sales team needs to confirm on regular basis that the information you received earlier in your discovery phase is still valid 3 weeks later.
Having ample knowledge gives you an advantage over your competitors (assuming they have not gathered as much information as you have). Do your research. In many cases ultimate decision makers may be aligned with one vendor or a sale rep. It is imperative to understand the organization’s political structure and outside loyalties. How do you find this out?
Simply ask the questions. In most cases asking combined with research combined with online information can be very useful. Gathering information is great, but make sure you take the time to document it otherwise it goes in one ear and out the other.
If sales is an art than paying attention to the details of the process differentiates average versus exceptional artist.