Today’s guest post is by Drew Wright, cofounder and principal consultant of Technology Finance Partners. Find him on Twitter @DrewTFP.
In sales, deals can be delayed or lost for many reasons, but almost no reason is more frustrating than the customer’s “decision” to do nothing.
I know this, having worked with hundreds of enterprise technology salespeople on thousands of opportunities. We’ve faced many competitive selling situations, against incumbents, other market leaders, and niche players. If you lose a sale to a competitive technology provider, at least you can say you fought the good fight, came to closure, learned something, and most importantly, got the chance to move on.
By contrast, losing to no decision keeps most salespeople engaged in the hunt. They waste time and resources and wind up with heartache. These deals, as they repeatedly jump in and out of various forecast categories, drive sales managers crazy.
What’s the Real Objection?
Sure, there are legitimate reasons for no decision (mergers and acquisitions, new management, a project sponsor’s departure), but customers often give reasons that are suspect. For example, if you hear such statements as, “This solution isn’t high enough on the priority list,” or “We don’t have enough budget,” your Spider-Sense should kick in. The customer is probably not interested in moving forward for one or more of the following reasons:
- You haven’t articulated the total value of your technology solution.
- You haven’t helped your prospect understand the pain associated with the cost of decision delay.
- You don’t have the financial decision maker fully engaged (or, certainly, motivated to buy).
How to Avoid No-Decision Delays in the Sales Cycle
For early-stage opportunities, you can take these preventative measures to avoid end-of-sales-cycle decision delays:
- Support early-stage value messaging through customer success stories that include quantifiable value metrics (e.g., cost savings or revenue increases).
- Seed early presentations with “value slides” that describe, illustrate, and provide the value calculation for economic-impact elements of your solution.
- Develop a business-value hypothesis based on targeted discovery questions and public information (as available) to provide a range of potential value and entice a deeper-dive business case analysis.
For opportunities that are deeper into the sales process, you can take these actions around prioritization, budget, and engaging financial decision makers:
- Collaborate with your prospect to develop a business case to demonstrate the value, economic impact, and likely return on investment in your solution. The analysis can be leveraged to move your initiative up the priority list. Also, if your sponsor does not want to invest time or energy in the business case, you’ll have learned that you’re not as far along in the sales process as you thought.
- Use the math from the business case to show the cost of maintaining the status quo and decision delay.
- Structure the deal so that solution costs are overwhelmed by receipt of benefits or spread out over multiple budget cycles.
- Combine this effort with a time-sensitive incentive offer that creates urgency, but don’t forget to show the multiyear value of the incentive offer – lower price, lower out-year maintenance, or lower subscription pricing (if providing a Cloud solution).
Much more could be written on each of these strategies, but the key takeaway here is that value selling throughout the sales cycle can help to overcome no decision and decision delay. It requires rigor, leveraging resources, and collaborative customer engagement. The alternative, however, is deal slippage, sales reps’ not meeting quota, and forecast inaccuracy…and you get only so many hall passes for those results.
For more information, read “Overcoming No Decision,” a white paper written by Technology Finance Partners principal analyst Alex Corman. You can also join us at the Sales 2.0 Conference in San Francisco, April 27-28, 2015, where we’ll elaborate on this topic in a breakout session.