Fix the 3 Most Common Revenue Killing Excuses
The title says it all. Here are 3 common revenue killing excuses, what makes them detrimental, and how to fix each one.
Excuse #1: “I’m too busy taking care of customers. I am going to skip some of my daily prospecting activities and catch up on them tomorrow (or next week, or next month).”
Common variation: “It’s after 5 pm (in some time zone), so I may as well wrap up this calling for today.”
Common variation #2: “Cold calling doesn’t work.”
Why this is flawed thinking: If a salesperson can get away with it one day, chances are one day will grow into two, three, four, and before you know it, you’ll have a real problem. It is just like exercise or dieting, or really any behavior that results in a benefit. It must become a solid habit to consistently produce success.
There may also be an underlying reason for this “don’t want to call” mindset. 59% of sellers today have an oversized Need for Approval, which basically means they need to be liked more than they need to close business. This could prevent prospecting consistency. Additionally, 85% of salespeople have self-limiting beliefs about sales and selling. Such things as “I don’t like to cold call” or “Prospects that think it over will eventually buy from me.”
How to fix it: Managers need to meet with salespeople and identify what is going on before the problem grows. Then, conduct a comprehensive goal planning session centered on the salesperson’s desires and aspirations and create a plan using the “Math of Success.” This will identify what the salesperson must do each day to ensure they have enough discovery conversations to fill the pipeline with adequate business opportunities, based on their closing ratios. Be certain to get a commitment from the salesperson regarding what they will do. It then is THEIR plan, not the manager’s. Now it’s simply a matter of holding them accountable to what they committed to do. And it is far easier to inspire them to do the necessary work if the work ties to their own personal goals.
Individuals’ mindsets must be addressed as well if managers don’t want to constantly be cracking the whip to get their team members to do what is necessary. The negative beliefs that one possesses are far stronger in sabotaging an individual’s success than we might imagine. To adequately change people’s beliefs and mindset takes time, reinforcement, and addressing the thoughts and experiences that underlie those beliefs.
Excuse #2: “I am going to have to reduce the price to win the business.”
Common Variation: “The competition will beat us on price.”
Why this is flawed thinking: The belief that price is actually the underlying reason why buyers buy is largely inaccurate. Oh sure, prospects want us to believe it since many are in the “it can’t hurt to ask” camp. They have been conditioned by less expert salespeople to ask because their experience has been that the salesperson negotiates internally to get the price lowered. Emotions actually account for at least 50% of the buying decision. Another factor: 72% of salespeople are uncomfortable talking about money. No wonder they would rather lower the price, the margin, and their commission to offer a discount than to sell value. But the salesperson’s beliefs and lack of proficiency in selling value are clouding reality.
How to fix: Help salespeople focus on the value that is provided to the client. Get them to think in terms of the client’s “cost of failure” if they don’t choose your products or services. Work through the actual calculations. Determine the ROI of preventing a disaster, or inferior product failures, or even the emotional toll on the decision-maker(s) if they get blamed for the failure. Oh sure, salespeople must understand the true value their solution brings to the client and the benefits offered that other clients may have experienced, but nothing will get the buyers more engaged than if they can visualize the potential disaster that could occur if they make a mistake and don’t choose your company to help them.
Excuse #3: “My pipeline is full, and I think that ABC Company is ready to close.”
Why this is flawed thinking: Unfortunately, there is limited correlation between the size of the pipeline and the reality of what will actually close. What we often see when salespeople have big fluffy pipelines is that they lose their sense of urgency and get complacent about prospecting. This is a revenue killer. Sadly, 71% of salespeople are not proficient at qualifying which means all that stuff in the pipeline is not as well qualified as we would like to believe. If you want to keep salespeople on track to meet goals, there must be a solid discipline around pipeline management and a tight focus on qualifying. Poor qualifying wastes salespeople’s time and energy by causing them to focus on the wrong opportunities and not spend enough time finding the right ones. It also produces unreliable pipelines that require senior leadership’s engagement to discern what is real and what is not real.
How to fix: It is critically important to have a sales process map that includes the framework for moving an opportunity along. Include what you need to know from the prospect, what questions to ask, what supporting materials or assets might need to be shared, and what the sequence is to follow. To really nail it, institute the use of a qualifying scorecard. List the different elements that impact the likelihood an opportunity will close, then identify the different variables for each element and assign scores to each variable. If you want to get fancy, assign an importance score to each element as well. Next, embed the sales process map and the qualifying scorecard into your CRM, and be certain that the questions are answered before moving the opportunity to different stages of the pipeline. Finally, be absolutely certain that a hurdle is set within the qualifying scorecard before a proposal is sent. The proposal should be viewed as the documentation of the discussed services, not a substitute for discussion. Having the right sales infrastructure designed to help a salesperson know what to do at every step, coupled with a limiting the number of proposals that are produced, ensures sales efficiency, thus increasing sales revenue.
Excuses only have as much power as you give them, but once they have power, they will stunt revenue growth, both from a prospecting and sales perspective and from a discounting and price reduction standpoint. Put a stop to them and watch revenue and profitability grow.
If you have more excuses to share and why they are flawed, I’d love to see them! Email me at Gretchen@BoostProfits.com
*Salesperson data from Objective Management Group