Sales win loss analysis - Increase your sales closure ratio by 10% in less than 6 months

Text-only Preview

Sales Win / Loss Analysis Increase your sales closure ratio by 10% in less than 6 months by Roch Gauthier The copyright of this work belongs to Roch Gauthier, who is solely responsible for the content. Please direct content feedback or permissions to [email protected] You may not extract or re-use any of the images in this document. rochgauthier eβooklet © 2009. All rights reserved. Page 1 Sales Win / Loss Analysis • Introduction • Starting a Sales Win / Loss Analysis Program: Roch’s Top 10 1. Find out what it is worth to your company 2. Inform sales & marketing management what it is worth Contents 3. Ask prospects permission to contact them following their purchasing decision 4. Eliminate the potential for biases 5. Conduct the sales win / loss interview soon after a deci-sion is made 6. Manage expectations and keep the sales win / loss in-terview brief 7. Ask the right questions 8. Generate “lessons learned” with key stakeholders 9. Share the sales win / loss insight 10.Internalize the lessons learned rochgauthier eβooklet © 2009. All rights reserved. Page 2 Increase your sales closure ratio by 10% in less than 6 months I have been working with hi-tech sales and marketing executives Introduction and directors since 1995. Some of the chief concerns I hear from these people include: “Our sales quotas keep increasing and so does the pressure to deliver. I need to find new ways to meet these targets.” “We’re losing business to competitors. My sales people tell me it’s because of price. I think there’s more to it than that.” “We’ve had a lot of turnover in the sales force. I need to find ways to make the new hires productive – fast!” rochgauthier eβooklet © 2009. All rights reserved. Page 3 Introduction Driving improvements in a company’s sales closure ratio is one of the most effective ways to help sales executives and their teams to achieve their sales quotas. There are various ap-proaches that can be employed to do this, but I find that a quick way to get results is to implement a quality sales win / loss analysis process. My goal in writing this eβooklet is to share with you some practi-cal advice on this matter based on my hands-on experience. What is win / loss analysis? Sales win / loss analysis is the process by which a company ob-tains feedback from a sales prospect and the account team members, following a purchasing decision. The goal of the proc-ess is to understand why a company won or lost the sale, share that information inside the organization, and take action as re-quired. rochgauthier eβooklet © 2009. All rights reserved. Page 4 Introduction Quality sales win / loss analysis drives dramatic im-provements in sales Many companies are looking for “the next big thing”. They spend large amounts of money developing new products and services in the hopes of increasing sales. Although product and service innovations are important contributors to the bottom line, there is often another powerful, yet neglected driver. Using some straightforward analyses, I have demonstrated to sales executives and managers that their biggest opportunity lies in improving their sales closure ratio. Implementing a sales win / loss analysis process is a quick and low cost way to get bottom line results. rochgauthier eβooklet © 2009. All rights reserved. Page 5 Introduction Sales win / loss analysis also helps companies achieve these goals: • Understand how to win against the competition • Understand customers’ decision criteria • Identify the typical roles involved in the customer decision making process • Increase sales productivity • Shorten the time required to make new sales hires productive • Quickly identify market trends and take appropriate action • Improve marketing messages and collateral • Help company representatives speak the same language used by your customers rochgauthier eβooklet © 2009. All rights reserved. Page 6 Starting a Sales Win / Loss Analysis Program: Roch’s Top 10 Find out what it is worth to your company Implementing a quality sales win / loss analysis process is a key way for many companies to achieve their sales quotas. If this is the case, why aren’t more companies doing this? The answer is simple; they have not taken time to work out the math. I’ve included a table on the next page that will allow you to quickly approximate the dollar value of increasing your current deal closure odds by a meager 5%. Just follow these three easy steps: 1. In the “Bids per year” column, locate the number that best represents the amount of quotes that your company tenders yearly. 2. In the “Typical order size” row, find the amount that best represents the average dollar value of those bids. 3. The intersection of your “Bids per year” and “Typical order size” selections represents the increase in yearly revenue as-sociated with improving your winning odds by 5%. rochgauthier eβooklet © 2009. All rights reserved. Page 7 Starting a Sales Win / Loss Analysis Program: Roch’s Top 10 Typical order size ($)10$ ,000 $ 2 5,000 $ 100, 000 $ 2 50,0005$ 2 ,500 $ 6,25 0 $ 25, 000 $ 62, 500ar10$ 5, 000 $ 1 2,500 $ 50, 000 $ 1 25,000ye5025$ ,000 $ 6 2,500 $ 250, 000 $ 6 25,000er 1005$ 0,00012$ 5,000 $ 500, 0001,$ 250,000s p2001$ 00,00025$ 0,0001,$ 000,0002,$ 500,000Bid3001$ 50,00037$ 5,0001,$ 500,0003,$ 750,000 Can your company’s winning odds be improved by 5% within a year? Absolutely! It is not unreasonable to even plan on in-creasing your win rate by up to 10% in less than 6 months as a direct result of implementing a quality sales win / loss analysis process. rochgauthier eβooklet © 2009. All rights reserved. Page 8 Starting a Sales Win / Loss Analysis Program: Roch’s Top 10 Inform sales & marketing management what it is worth Now that you have an idea of what sales win / loss analysis is worth to your company, your next step is to make your sales and marketing leadership team aware of this. Develop a concise business case to help management understand the essentials of a sales win / loss program. Your business case should provide answers to the following questions: • What is sales win / loss analysis? • Why should your company do anything in the first place? What is the value? How quickly can you expect to capture this value? • Why do this now? What are the consequences (if any) of not doing anything? • What is being proposed? What is the process? What are the deliverables? rochgauthier eβooklet © 2009. All rights reserved. Page 9 Starting a Sales Win / Loss Analysis Program: Roch’s Top 10 Investments in sales win / loss programs should be relatively quick and easy to fund given the associated return on invest-ment. Make sure to appoint an independent and objective per-son to conduct the sales win / loss interviews (more about bi-ases later). Someone responsible for customer, competitive and market re-search inside your organization might be the right person to own this process and create the sales win / loss deliverables. If you can’t find someone inside of your organization, you may wish to consider outsourcing this activity to a reputable third party. rochgauthier eβooklet © 2009. All rights reserved. Page 10