If your sales reps are wasting weeks or even months coaxing reluctant prospects to sign contracts, it may be time to take a closer look at your sales cycle. A slow sales cycle means your sales reps are working longer and harder to close every deal. This can impede your team’s ability to generate revenue by sucking up the time and energy that could go into closing more deals.
As a manager, you can help your sales team better prioritize their efforts and shorten your overall sales cycle. Using data analytics, you can identify better sales techniques to incrementally speed up the sales process, leading to less wasted time and more deals closed.
(For even more information about cutting down your sales cycle, check out our FREE guide: How to Shorten Your Sales Cycle.)
Analyze the Sales Cycle
Your very first step should be simply to look at the data and find your team’s overall average sales cycle. Then you should drill down further, to look at how long opportunities that closed-won spent in each stage of your sales funnel, compared to losing opportunities.
In this report, you can see that on average, winning deals close much more quickly and spend less time in each stage. For example, a winning deal spends about 5 days in the Qualifying Stage, compared to 15 days for losing deals. You can also see that all opportunities spent the bulk of their time in the Present Solution Stage. This analysis can help your team focus on improving the speed for this specific stage, and also focus less effort on deals that spend more than 10 days in the Qualifying Stage. This helps your team by giving ideas for improvement, and tips on which types of prospects to avoid.
Understand the Ideal Buyer
In order to close deals faster, you want your sales reps to focus their efforts on deals that are more likely to close. So how do reps identify which prospects will be a waste of time and which are promising? The first step is understanding your rates of success with companies of varying sizes. You want reps to target ideal customers, so it’s important to understand the patterns of a buyer vs. a non-buyer. You can find these patterns by analyzing the your team’s win rates for both large and small deals.
In this report, you can see that your team has a much higher win rate when the opportunity dollar value is smaller. With this data, you can direct your team to target deals in the ideal sweet spot $3,000 to $7,000 range. This prevents your reps from fruitlessly chasing whales, and instead allows them to focus on historically closable opportunities, instead of wasting time on opportunities that will likely never close.
Segment Deals by Industry
Similar to understanding buying patterns by deal size, sales reps also need to segment deals by industry and intimately understand the buying habits of each vertical. This requires reps to do research into the buying process of their prospects at the very beginning. For example, if a prospect is a government entity, this deal is going to take a longer amount of time. If it’s a larger corporation, there are many more layers of approval and process to get through.
Again, it’s all about prioritization. Reps can’t call every single opportunity in the pipeline every day, so they need to prioritize and put more effort into the most promising opportunities. Sales reps may find that dealing with government entities is too much of a time suck and is simply not the ideal customer for their business. Only you can discover which customer’s you want your team to sell to, and which get pushed to the bottom of the pile.
Stick to a Timeline
As your reps begin to go after promising opportunities, you should also encourage them to stick to a tried-and-true sales method: setting a timeline for each opportunity and following it strictly. This means reps have to implement a Buyer-Seller Agreement, or up-front contract, with every prospect. These are verbal agreements made at the beginning of the sales process to clearly define expectations, for both the rep and the prospect. These expectations can cover a range of things, but in this case, it’s all about timing.
Whenever you speak with a prospect, make an agreement to set clear deadlines for each next step in the process. Say, “Let’s connect next week for a demo” and make sure to set up a calendar invite immediately. Don’t let the prospect say “Call me in a week” or push you back to a later date. You can’t rely on email to keep a customer on track and on time. Always lock in the next step in the process before hanging up the phone, and you’ll see a marked decrease in the time it takes to reach Closed-Won.
By using data to discover your ideal customers, your sales reps can make better use of their time each day. They can focus on selling to prospects that follow winning patterns, rather than wasting weeks working opportunities that will never close. By making the most of your team’s efforts, you can shorten your sales cycle and improve your overall win rate at the same time.