Categories: Sales Conversation
Today’s blog post comes from Force Management Delivery Partner Tim Caito. Caito has more than 30 years of sales, management, and business consulting experience. He has consulted with some of the largest companies around the world, including AT&T, Fed Ex, Symantec, Microsoft, Coca-Cola, Walmart and American Airlines, on both the seller and buyer side.
In Ten Reasons Salespeople Lose Deals, Harvard Business Review Blogger Steve Martin listed the top challenges sellers felt were keeping them from gaining new business. At Force Management, we hear the same challenges from sellers every day.
Sales organizations around the world are plagued with sellers who lose deals due to no decision or failure to articulate value. Indeed, Martin’s column and research provide a solid perspective from the average seller. What it doesn't do is consider these challenges from the buyer perspective. Are these really challenges sellers have no control over? Or, are they indicative of the way your sellers perceive their reality and the related impact those perceptions can have on how they take control of their sales campaigns.
To be blunt, when you consider this alternative view, I believe you'll see these challenges are most often nothing more than emotional cop-outs that deflect responsibility away from the sellers to someone or something outside of their control. Let’s take a closer look at a buyer's perspective on the Ten Reasons Salespeople Lose Deals:
1. No Decision
Buyers would say "No Decision" is actually a Decision, it’s just not in favor of the selling organization. They would say the seller in these cases made a good business case on the core issue they wanted addressed, BUT that business case failed to prove itself to be a superior investment when compared to other issues competing for funding and attention.
Sellers’ feeling that they lost a deal due to “No Decision” is more of an emotional, feel good, cop-out. It puts the blame on their unappreciative customers, who are obviously completely out of the sellers control; versus blaming the sellers own failure to qualify beyond the immediate project/business issue.
2. Stalled Sales Cycles
I think buyers would say “Stalled Sales Cycles” are caused by a seller’s inaccurate sales and forecasting process. The challenge here is most likely the result of sellers not understanding the customer’s buying process, decision-making, influence structure and competing business priorities.
3. Inability to Penetrate New Accounts
Are we seeing a theme here? Now the issue appears to be with the marketing department! If you’ve had a hard time selling to prospects, it likely means your business case isn’t compelling/relevant or you haven't introduced the right business case to the right people. While marketing is a critical piece of penetrating new accounts, it doesn't replace what sellers can do themselves!
4. Product Commoditization
Nobody accepts this argument, especially CEO’s from either seller organizations or buyer organizations. Buyers have learned the hard way that even when purchasing commodities, there are key differences that influence their decision-making. Differences outside the product fall squarely on areas like services, business operations, experience and reducing risk. That’s why it's crucial for a company to define those differentiators and make sure they’re incorporated into a messaging framework.
5. Price versus Value
“It’s not me boss, it’s our pricing!” Buyers would say this is a classic seller cop-out. If we as sellers fail to position the incremental value of our offering, we get what we deserve when buyers anchor on competitive pricing in negotiations. Buyers tell me all the time that sellers who cannot defend against competitive pricing anchors have clearly not established their value earlier in the conversation.
Buyers say, “It’s our job to seek the lowest price possible, but not at the risk of other core needs. If a seller can’t defend their premium in meaningful ways relevant to our business, why should we pay more for the privilege of buying from them?” In Martin’s blog, he seems to suggest this reason for a lost sale as largely a selling failure… and as such, once again largely controlled by the sellers.
6. 800-Pound Gorilla
I love this one, because I’ve consulted on big deals with some of the biggest gorillas in the world. They all complain that their size often hurts them when competing against smaller, more nimble competitors that specialize in a given market or product niche.
Buyers routinely seek viable alternatives to committing so much of their spending power to a handful of 800-pound gorillas. This issue has more to do with sellers underestimating what these gorillas can leverage when competing against them. Do you really expect the 800-pound gorilla won’t swing back when we threaten their business?
Sellers need to make their big competitor’s strengths seem like liabilities. Most buyers would welcome the opportunity to create ongoing leverage with the big gorillas they buy from by occasionally awarding some business to smaller organizations. Sellers just need to include that as part of their message, value proposition and differentiators. Sellers competing against the 800-pound gorillas in their market need to emphasize what the gorillas cannot easily provide – like a viable second source of supply, flexibility, nimble decision-making, responsiveness, etc....
7. “Nice-to-Have" Product
Buyers would say their “Must-Haves” are tied to the way they prioritize their business issues. Sellers that fail to help their customers first prioritize the business issues they address, before trying to position their offering will always get blocked by the “Nice-to-Have” objection. In fact, contrary to what they might say early in the negotiation I believe most professional buyers would say they’ve never made a “nice-to-have” purchase decision.
If sellers perceive this to have been a problem in the past, it likely means someone on the customer’s side has been justifying or not justifying the buying decision on their behalf. If that’s the case, then the seller deserves to lose that sale because he/she has not been helping the customer defend that spend! It’s not about change occurring in the way customer’s buy. It’s about the failures in the way sellers have historically sold that are now being exposed as vulnerable in today’s more highly scrutinized spending environment.
8. Internal Sale
The “Internal Sale” excuse is likely caused by a seller’s inaccurate sales and forecasting process. Sellers lack of understanding of the buying process, often means they’re negotiating on price with procurement and trying to get the internal buy-in from others in their own company to go along with a super-discounted deal or big concessions. If you know what makes a great deal for your company and you’re effectively articulating those requirements throughout the customer’s buying cycle, then there will be no problem with the internal sale.
9. Administrivia
It's true, updating CRM systems and burdensome administrative process can monopolize seller time. Buyers would say, “I can relate!” They would also say these systems generally don’t provide customers any value, so they are unclear why the sellers spend so much time trying to manage them. Buyers do object to how much influence these tools/systems have over daily interactions they have with the sales professionals that call on them. The good ones understand sellers have forecasts and planning requirements, and are willing to help if they can. This is one legitimate issue raised on the list, but it isn’t big enough to block sales from being made. So, again it’s likely a cop-out.
10. Pre-Sales Resources
Lack of resources to help support sales efforts is a reality… just not a new reality! Few buyers would describe this situation as a resource constraint for the selling company. They would more likely describe the perceived outcomes of this problem (sellers not responsive, poor service & support, etc…). I'll give this one to a seller; it's a challenge, not a cop-out. However I’ve often found that the highest performing sellers always find a way to leverage their track record and internal credibility to get the resources they need, when their customers need them!
The sales guy in me agrees with all of these challenges and observations, but as you might guess buyers would see these from a different angle than us. I simply share this perspective from the other side of the table so that as we sellers position our value against these issues we get as close as we can to the core issues that control the actual buying decision.
If you consider these challenges as being out of the sellers' control, you're ignoring the root cause of the problem. Underneath these challenges are issues that can be addressed by improving your own sales messaging and your sales process, things that are in complete control of the selling organization.
