It seems that you have done everything right: your prospect has clearly explained his business and relevant personal issues; you’ve connected to those issues with a solution only you can provide; you are working directly with the person who has the authority and ability to make the decision; and you’ve agreed, in writing, to what you and the prospect will do together to initiate a business relationship. The only thing missing is you haven’t been able to get them to sign on the dotted line.
If you are like most sales people, between 30% and 50% of the sales in your pipeline will result in no decision. In a tough market, one of the biggest productivity returns you can reap is to reduce the impact of stalled decisions by identifying them early in the sales cycle. However, in order to jumpstart a stalled sale, you must first diagnose the reasons behind it. The problem isn’t that the sale stalls out in process, the problem is that often we don’t recognize it soon enough and therefore we expend time and resources on these dead-end opportunities.
One of the most common complaints or challenges we hear from our clients has to do with stalled opportunities. The scenario typically goes something like this: a sales cycle is progressing with a prospect. All the buying signals are being observed, and then … nothing happens! No return phone calls. No return e-mails. No communication at all!
What do you do?
After reviewing thousands of stalled sales cycles with our clients over the years, we have identified the five most common explanations for a sale in limbo.
1. Lack of Connection to a Critical Business Issue
Unless your solution has increased revenue, time to market, cost management, improved quality, competitive differentiation or some other looming business issue tied to it, you can expect a stall. Senior executives only spend time on matters that directly impact their business.
There are only three questions a sales rep has to ask to uncover business issues…Why? Why? And why?
- Why do you want this solution?
- Why are those problems important to solve?
- Why would that matter to you or any other executive?
2. Lack of Perceived Value
Most people can only juggle five or six critical issues at a time. We prioritize these issues in order of their “value” – the benefit tied to solving the issue. If value isn’t identified, an issue will quickly fall to the bottom of the list. Can your prospect articulate the “value” or impact of addressing their business issue? If your solution, from their perspective, doesn’t have enough value to get in their top five or six issues, you are stalled or put on the back burner. Ask the prospect to quantify the impact of resolving the business issue. And better yet, ask them how the solution will impact them personally.
3. Lack of Differentiation
Lack of differentiation will cause the prospect to spend more time evaluating, which translates to a stall. If you are unable to differentiate on capabilities and solving problems, you will be forced to differentiate on price.
4. Decision Authority
Decision authority is one of the most common causes of a stalled decision. The buying frenzy of the last decade all but eliminated the need to call on the real decision-makers for everyday purchases. Those days are over. In order to avoid a stall caused by lack of authority, you need to ask your prospect key questions such as, “Have you made this type of decision before?” and “When and how?”
Triangulate your information by asking these questions to multiple people in the organization in order to find out who really has the decision-making power in the organization.
Selecting a new vendor or a new solution involves risk for your prospect. The prospect’s perception of risk can span business impacts, such as lost time or money; or personal ramifications, such as career or reputation. As a prospect gets closer to making a decision, the risk becomes greater in his/her mind. Common tools for alleviating risk include supplying references, trial usage, demonstrating credibility with iron clad implementation plans, guarantees and your executive backing.
Once you identify the likely cause of your stall, you can craft a strategy to re-energize the sales cycle by focusing on the missing link or underdeveloped component.