Five Reasons You’re Losing Customers - August 7, 2017
You know the old adage, "You win some. You lose some." In sales, when you lose some, what do you do about it? In most cases, many of us simply move on to the next prospect rather than figuring out why we lose some of our sales.
What if you took the time to figure out why you lost the deal or lost that account? What kind of value could you glean from this type of insight? Would this knowledge take you to the next level of sales?
Steve W. Martin, business author and professor of sales strategy at the University of Southern California, said in his recent HBR.org article that, according to a new study of more than 230 buyers, 12 percent of salespeople are excellent, 23 percent are good, 38 percent are average and 27 percent are poor. He studied interviews with buyers to identify key mistakes that salespeople make that cause them to lose deals or customers, which we'll share in this issue of Promotional Consultant Today.
- Lack trust or respect. As Martin explains, there are different ways a customer can view you as a salesperson. You can be the provider of the product or service—someone with whom they do business. You can be a strategic partner in which the relationship is important to the business. Or, you can be a consultant or trusted advisor for the customer who has significant advantages over the competitors. Of course, you want that role of trusted advisor, yet according to the buyers reviewed by Martin, only 18 percent of salespeople over the past year would be classified as trusted advisors.
- Don't know how to interact with the C-suite. Talking to senior-level executives in an organization, such as the chief executive officer or chief financial officer, requires a different type of conversation than speaking with mid- to lower-level management. Because of their strategic level of responsibilities, they have different priorities and pain points. As Martin points out, it is critical for salespeople to understand how C-level executives think and to know how to communicate with them in the right way, yet he says that fewer than one out of three salespeople can hold an effective conversation with senior executives.
- Can't apply the value of their product or solution to the customer's business. Whether it's a simple product or a complex, technology-based solution, salespeople spend a lot of time in training to gain an understanding of their product. They might know every aspect of what that product or service does, but if they can't apply that product's strategic value to the prospect's business, then the opportunity is wasted. Martin says, "Different strategic values include increasing revenues, decreasing costs, gaining a competitive advantage and standardizing operations in order to reduce risk. However, buyers say only 54 percent of salespeople they meet with can clearly explain how their solution impacts the buyer's business."
- Lack authenticity. Martin's study revealed that, when asked to choose the primary reason they don't like meeting with salespeople, participants said they felt pressured by self-centered salespeople. The majority thought the salespeople were simply focused on their own agenda and not on the priorities of the prospect's business. They simply wanted to make the sale and get the revenue, not actually help make the buyer more successful.
- Don't know how to close the deal. After time and energy has been made on both sides of the deal, often salespeople lose out because they don't know how to get the deal over the finish line. Martin's study revealed that high-pressure tactics, such as " This is the last time we'll be able to extend this offer so act now " were least effective because of the take-it-or-leave-it tone. However, soft close approaches were more effective, such as "If you spend another $100,000, you will receive an additional 10 percent off the entire order" were rated most effective as it keeps the buyer in control of the deal.
As you work on your next deal, remember these insights from Martin's study to help you stand out among the competition, engage with your potential customer and successfully close your sale.
Source: Steve W. Martin teaches sales strategy at the University of Southern California Marshall School of Business. His new book is Heavy Hitter I.T. Sales Strategy: Competitive Insights from Interviews with 1,000+ Key Information Technology Decision Makers.