Do you know what a winning deal looks like? Of course you do! You probably go to bed every night dreaming of the great deals your reps closed-won that day or week.
But do you really know what a winning deal looks like?
We’re talking about the nuances and nitty-gritty details that make up a winning deal. Wins might come from different customers and clients, but they all share at least a few similar characteristics. Identifying these characteristics – win factors – can shape your understanding of the sales process, give you actionable insight for coaching your reps and, most importantly, help you set reasonable and realistic expectations when sales forecasting.
Let’s break down what a win looks like.
Opportunity value matters
While there are many variables that can factor into a winning deal – including lead source, sales cycle, close date changes, age in stage, momentum etc. – for our money, one of the best tell-tale signs is opportunity value. We sought out to answer the question, “How does opportunity value correlate with our win rate?
The answer, as it turns out for many B2B sales organizations, is, “Very strongly.” Historical data across many different companies suggest that there is a direct correlation between an increasing opportunity value and a decreasing win rate.
Let’s look at an example from a hypothetical sales team. The Win Factors report for this team shows an almost perfect correlation and inverse relationship between increasing opportunity value and decreasing win rate.
As opportunities becomes bigger and more valuable, the likelihood of the rep being able to closed-won that opportunity shrinks. This makes sense: potential buyers are likely to pay more attention and scrutiny to an expensive purchase costing more than $20,000 than they would a cheap buy that costs less than $2,000. As the cost becomes more expensive, the prospect might start asking questions like:
Is this a better value than what competing products can provide?
For this type of investment, will I be able to generate decent ROI?
Do I trust what this company and sales rep are saying?
And finally, the biggest question of all:
Do I really need to buy this?
As the cost goes up and the questions pile up, doubt might creep into the mind of the potential buyer. Eventually, the cost of the opportunity might prove to be prohibitive, scaring many potential buyers away – hence, the higher the opportunity value, the lower the win rate.
How can Sales VPs leverage these insights?
There are two primary ways that VPs of Sales can use the information from the Win Factors report:
This provides a healthy grain of salt when evaluating opportunities for sales forecasting purposes. The Sales VP might hear one thing from sales reps – “Oh that opportunity? Yeah, it’s definitely going to close, our champion there LOVES us!” – but the data might say something different altogether.
With the insights from this report, Sales VPs can interject, qualify the rep’s subjective evaluation of the opportunity and say, “Well this is a very large opportunity, and our win rate on these types of opportunities is 15% less than our average win rate. What makes you so confident that it will Closed-Won?” They can then discuss the opportunity in more detail and the Sales VP can decide if it really belongs on the positive side of this sales forecast or not.
Sales VPs can also use the Win Factors report to help identify the ‘sweet spot’ for the team. According to this example report, this sales organization should be targeting opportunities between $2,000 and $10,000. They have a pretty good chance of winning these types of opportunities, and should spend a good portion of their focus generating these opportunities and then closing them.
They can also differentiate opportunities for reps by earmarking the biggest ones (and most difficult to win) for their most experienced and talented reps. Even if these reps see their personal win rates dip below their typical averages, they will make up for that decrease with increased value, without having to sacrifice the win rates of younger and less skilled reps.
Knowing what a winning deal looks like can pay tremendous dividends for Sales VPs. Start by looking at a Win Factors report to identify what your historical wins have looked like, and plan accordingly going forward.