The expression, “sales is a numbers game,” is one that sales leaders use all the time.
Whether you are an entrepreneur, sales executive, or are involved in other ways with generating revenue for the company, you are probably familiar with that saying. The idea is that the more prospects you interact with, the more successful you will be. So, in other words, increased activity leads to increased revenue.
This belief seems perfectly logical. However, it can be harmful to your business if misinterpreted. Spending time with prospects that are not buying generally is not a great way to increase revenue. Therefore, you want to spend more time with prospects that buy, and little to no time with those prospects that are not buying. This seems like common sense, but it isn’t common practice.
Companies generally spend a lot of time qualifying prospects, which is an integral part of the overall sales process. They develop a set of criteria that they use to determine if a prospect is worthy of their sales efforts. However, it is important to understand that just because a prospect fits the chosen criteria doesn’t mean they are your best prospect -- or are even qualified, for that matter. With limited time and resources, it is important to make the distinction early.
Over the years I have seen two major reasons why leaders inadvertently spend too much time and resources with the wrong prospect.
They are too focused on the 'ideal' prospect.
In almost every industry, companies make the mistake of thinking the biggest target is always the right prospect to pursue and, therefore, all efforts are consumed in that pursuit. Sometimes that is a strategy that works, but it can be dangerous when it doesn’t.
Companies figure if they land this big and strategic prospect, their business will thrive and everyone will be happy (or something along those lines). That statement could be true, and I have been in situations where this has happened. However, I have also seen situations where the reverse was true. I have literally seen companies go out of business while pursuing their ideal prospect. In pursuit of that large corporation, government contract or influential individual, they allocated the vast majority of their resources to no avail. The prospect never spent any money on their solution, and the company did not survive the misallocation of resources.
Usually, there are warning signs that suggest your version of the ideal prospect is not correct. A great prospect, whether a business or individual, will want you to be successful. They will let you know how you can help them solve their problems. In other words, they will be able to articulate the value of your offering. If you are pursuing prospects that can’t, or won’t, act in that manner, then they are probably not ideal.
They only go after prospects who seem to like them.
Another reason ineffective sales leaders get stuck pursuing the wrong prospect is that they have developed a good personal relationship. I use the word personal instead of professional because the prospect isn’t buying anything, so that makes it personal. Sales is a relationship business, so we tend to gravitate to those that are nice to us, especially if it is a prospect that appears to meet our qualification criteria. We just figure that, at some point, they will buy. After all, they like us and they claim to like our product or service.
The danger with these kinds of relationships is that they are very time consuming and, if the prospect never buys, it is time you could have spent pursuing others. Once the determination is made and you realize the prospect isn’t going to buy, there is no reason to be rude or unfriendly. You just have to make the appropriate adjustments. Stay friendly, but do it at a distance. They will call you if they ever change their minds.
What's the alternative approach?
Both scenarios mentioned above can be very enticing for the company and sales professional because each can generate a lot of activity and a lot of optimism. The ideal prospect represents great potential, and the friendly prospect represents an easy sale, so it is not hard to see why there is such optimism. As a sales leader, you can’t let the optimism take over your better judgment. These situations can become very toxic if you are not careful.
Sales is a numbers game, and activity is important. It is impossible to generate sales without these things, but the quality of the activity is more important. Every hour you spend pursuing a prospect that is not going to spend money with you is an hour you are not spending pursuing those prospects that are more likely to buy. Too many professionals use the approach that, if they tell a good enough story to enough people, it will all work itself out and they will be successful. That simply is not true for most.
Perhaps a better approach is to do more upfront analysis. Review your historical data so that you can determine who is most likely to buy from you. Literally write down the characteristics of the person or company that tends to buy from you most often. Once that is done, concentrate your efforts on finding those prospects. Over time, the goal will be expanding the profile of the ideal target so that your target market expands, which will lead to more revenue and greater success.
The most successful sales leaders and businesses use this approach. They have done the research and they can tell who is most likely to buy from them, what they are going to buy, and when or how often. The older and more established the company, the easier it is to collect such data but, either way, it is the focus on who actually buys versus who we want to buy that is important. Whatever your role in generating revenue, your desired outcome is much more achievable if you strive to develop the same understanding of your potential market.
Originally published on December 31, 2017 by SpeakerMatch Speakers Bureau