According to BrightFunnel, a marketing intelligence platform for B2B selling, deals are more difficult and are taking longer to close. Compared to 2014, B2B deals in 2015 took 52% more marketing touches and lead-to-revenue sales cycles increased 32%.
Lengthening sales cycles are damaging in obvious and “invisible” ways. Consider the negative impacts of lengthening sales cycles:
- Less sales capacity, making it more difficult for salespeople to hit quota and requiring larger sales teams to meet growth objectives.
- Less predictability, and therefore greater disruption in allocating both sales and operational resources.
- If you have investors, this disruption also negatively impacts the confidence of your investors, putting more pressure on senior teams and threatening future capital needs.
All of this equates to significantly higher costs for growth, while also accepting a slower growth rate in the process. A clear lose/lose proposition.
Yet, despite this growing trend, many companies are experiencing the opposite. Shorter sales cycles, lower sales costs and greater predictability. Let’s look at some key tactics your sales and marketing teams can collaborate on to shorten your average sales cycle.
1. Clearly Defined Ideal Client Profile and Buyer Personas
It’s important for sellers to realize that the sales cycle begins before (often long before) a member of your sales team (or you) have the opportunity to actually engage with a prospect. In today’s Zero Moment of Truth (ZMOT) world, the prospect is more in control of their journey than ever before.
Managed correctly, this can be a great opportunity to improve lead generation. However it can also be very damaging if not managed effectively. As prospects take on more of the decision making process, sellers often lose the opportunity to influence and explain in the crucial early stages of discovery.
This means that sellers (and marketers) must think further and deeper to create content that resonates, influences and moves the right prospects towards your direction, even when you don’t know they’re even out there.
And, yes, that means you must clearly define your target market more deeply, which buyer roles are important to creating opportunities and winning deals, and fully define the personas for the primary role players you need to influence. I’ve seen the impact that clearly defined profiles has not only on attracting the right prospects (which is key to shortening your sales cycle), but also to your sales team’s ability to quickly connect and move the sale forward.
2. Contextualize and Deliver a Clear Teaching Point-of-View
As I alluded to in my previous point, buyers are smarter, stronger and more in control than ever before. This means that sellers must earn the right to gain the prospect’s attention and to demonstrate the crucial value they can provide in leading prospects to solve their problems and capture their opportunities.
The key word here is leadership. The failure to assert leadership throughout the buyer’s journey will not only lengthen your sales cycle, but will commoditize you as well. This means that sellers and marketers need to stop babbling on about the “we-do’s” and boring prospects with features and benefits.
It requires taking two actions:
- Consistently delivering a teaching point-of-view that challenges, engages and educates your personas.
- Delivering your message (point-of-view) in a highly contextualized and personalized manner (another reason personas are so important). If you’re constantly delivering the same message to everyone, whether it’s in person or on your website, then your prospects are going to quickly come to the conclusion that your salespeople aren’t an important part of the process and they’ll be ignored. Now, more than ever, you must be able to deliver the right message, to the right person at the right time.
3. Have a Defined Diagnostic Protocol
I am regularly shocked by how unprepared salespeople are when that crucial first moment of influence presents itself. I see it regularly as a prospect and I deal with it when I’m coaching salespeople.
A few weeks ago I was talking with a major market research firm discussing a project we were considering them for. On this call, I was talking with both their sales rep and his manager. I also had David on the call with me. The call was scheduled for 30 minutes and the first 10 minutes were an absolute waste (I think they asked some version of “How are things?” at least 7 times).
What’s worse, when the conversation started they didn’t ask a single meaningful question and I didn’t learn anything I didn’t already know in the process. The conversation led me to believe that if I were going to address the issue I was considering them for, I would not be able to rely on them; I would have to figure it out.
This creates a lose/lose proposition. They spent a fair amount of time putting a proposal together, I spent time sharing information with them and considering the proposal. In the end, we both have nothing. They don’t have a sale, and I have the same problem I was dealing with.
In many other situations, I see salespeople fumble around asking boring, useless questions that don’t really do anything for anyone. Look, I get the idea that you want to make a connection before you dig deep, but for heaven’s sake make it quick, and then get to what matters.
Important point: I don’t blame salespeople for this problem - I blame their managers and their organizations. Solving this problem requires the creation of a defined diagnostic protocol, and then training the sales team on how to apply that protocol in live situations. Your prospect is making decisions about your value within minutes - be sure not to lose out.
4. Be Clear on Red Flags
The single most costly (and unfortunately common) mistake sales organizations make is wasting time on sales opportunities that aren’t really opportunities. When we do initial pipeline reviews with sales teams from new clients, it’s not unusual to realize that 50 - 70% of the opportunities in the pipeline don’t belong in the pipeline. According to CSO Insights, only 46% of sales opportunities that are forecasted to close actually do.
I’ve always said that professional selling organizations should learn the lessons of the best poker players. If you’re going to make real money playing poker, you must be disciplined (and a bit cynical). Poker players pay far more attention to what’s wrong with a hand, then they do with what’s right. As a result, a true poker player will only “go in” on a very small percentage of possible situations. They are clearly aware of the “red flags” that can cost them money, and work hard to avoid them.
Yet, very few selling organization (let alone salespeople) have clearly defined the red flags that represent potholes, barriers and problems in the process. Clearly understanding red flags, helps you shorten your sales cycle in two important ways:
- You avoid wasting time on prospects that aren’t going to buy. This frees up time to spend with those who could become customers, and to serve those prospects more effectively.
- When you see red flags you can deal with them proactively, instead of reactively at the end of the sale. Dealing with them upfront gives you a greater chance to eliminate them.
5. Conduct Win and Loss Reviews Consistently (and Track The Data)
When I begin working with a prospect, I ask three questions early in the process:
- Why do you win the business you win?
- Why do prospects who should buy from you fail to do so?
- How do you know when you’re talking with someone who looks qualified from the outside, but in reality isn’t going to buy from you?
About 70% of people mumble and ultimately admit they don’t really know. Another 25% give me their gut reactions and cite anecdotes. Only about 5% are able to give me clear answers, and only about half of those have real data to back up those answers. Inevitably it’s that last 5% that are always performing strongest when I meet them.
Years ago I had a coach who talked with me about what he calls “gravitational systems.” For example, prospects becoming less reliant on salespeople is a gravitational system. This means that if you don’t actively work to “go against gravity” the trend is going to take over.
Lengthening sales cycles for B2B organizations is a gravitational system as well. If you don’t want your sales costs increasing while your growth rate decreases, you must actively manage against gravity. Implementing these five tactics will give you a strong base to go against gravity.