Today I got forwarded a “sales tip” that talked about “Being OK with No.” The gist of the piece was that sometimes it is better to walk away than waste your time on a prospect that 1) said “no” or 2) isn’t right for you in the first place. Let it be a learning experience and move on.
Good points. Except, the marketing person in me wanted to jump in and get involved. Fine, Mr. Sales Guy. Be OK with “No” but do take a moment to keep that door open through your marketing team.
Even earlier today I went to a marketing and sales breakfast sponsored by Eloqua. I liked the idea of a seminar addressing both sides of the equation and while I am not an Eloqua customer, I understand the principles of their product and can appreciate what they are trying to do.
Overall, the seminar was very well done and I took away a lot of data points. (Apologies to all involved if I am misquoting or misheard anything, was writing furiously but maybe not furiously enough.) The speakers included Greg Alexander, CEO of Sales Benchmark Index (SBI) and author of Making the Number, Steven Woods, CTO, Eloqua and author of Digital Body Language, and Debbie Qaqish, Chief Revenue Officer, The Pedowitz Group. Here are some of the data points that I am now arranging to help make my point.
- Before today’s market, the average pipeline to quota ratio was 5 to 1. (In other words you need $5 million in the pipeline to close $1 million worth of business.) This is a 20% close rate.
- In today’s market, the average close rate is closer to 13 percent.
- You find the biggest percentage of losses in the “no decision” category. (The prospect didn’t go with a competitor, they instead decided to do nothing.)
- If a sales rep takes “do nothing” to be “no”, they may lose that sale at a later date. Another, more patient sales person may be able to educate the prospect sufficiently to close the business.
- If “do nothing” is heard as “do nothing NOW and maybe do something LATER” and gets turned over to marketing, the prospect can be further educated and nurtured without taking up too much expensive time from the sales force. There are things the marketing team can do to cost-effectively keep that lead alive.
Today’s marketplace has a higher percentage of latent opportunities than active opportunities. Latent opportunities are prospects who need to be educated as to why they need your “product”. Sometimes marketing tactics can be used to 1) show them their pain and 2) demonstrate how their problem can be solved. In other words, they might not even recognize they have a problem but smart marketing can help them understand it better.