Companies operating in a B2B marketplace depend on their sales organization to generate the revenue necessary for a viable business. CEOs of those companies are more likely to have a successful sales force if they can provide a predictable, repeatable sales process. Basic to the sales process is an understanding of the classic Sales Cycle. As with the Buy Cycle above, there will be some variations in each specific sales opportunity, but each of the steps needs to be taken to help insure a successful outcome.
A successful sales person will adjust their Sales Cycle to best match the Buy Cycle of the prospective customer. Although the length of the Sales Cycle can be impacted by a salesperson, the Buy Cycle will be the main control and will be guided by the factors mentioned above.
1. Qualify Lead – Identify Need / Pain – An effective sales person recognizes that their time is limited, so qualifying a lead up front is critical. Qualification can be based on factors such as whether the prospect’s environment is a fit, whether they have an identified pain or need, and whether there is a project/budget for the product. Qualifying new lead is crucial to determining the best prospect that warrant the sales person’s time.
2. Identify Decision Maker(s) & Build Relationships – There is always someone at every company that will be willing to occupy the time of sales people. However, in many cases, those people will not be able to make a decision or sign a contract. As soon as possible, a sales person must identify the individuals in a company that can influence or make a decision, and build relationships with them.
3. Offer Vision / Solution / Value Proposition - After the level of pain or need is identified and is clear in the mind of the prospective customer, the sales person’s task is to create a vision of the prospect being successful using their product in such a way that it is a better solution than any other alternative. Having in-depth product and domain knowledge is essential to being able to create a clear vision of success. Prospects must understand the value of your solution before they will move to the next step. If the level of pain or need is relatively low, the sales person must decide whether to take the time to try and influence the pain level, or to move on to more viable prospective customers.
4. Provide Proof & Handle Objections - During the evaluation stage of the Buying Cycle, the sales person must provide proof that their solution will fit the buyer’s needs better than other alternatives. The process will vary depending on the product and the buyer. More than one type of proof may be required:
- Site Visit
There are typically some bumps along the road. Usually, competitors are involved and they frequently supply the prospective customer with some perceived weaknesses in your product. These disadvantages sometime come back in the form of objections. Other times, the objections are due to lack of knowledge on the part of the buyer. Having a good understanding of the strengths and weaknesses of one’s product is crucial for being able to handle objections. Occasionally, objections are presented just to see how the sales person will react, but are not important to the person posing the objections.
5. Establish Terms & Conditions / Negotiate - Terms and condition of the sale must be clear to the buyer. Knowledge of the license agreement or contract terms is important to being able to successfully negotiate a deal. Knowing what terms are negotiable and then knowing when and how much is appropriate will lead to win-win agreements.
6. Close – Get the business – get the agreement signed at terms fair to both the buyer and the seller.
A somewhat confusing aspect of the traditional Sales Cycle is that some terminology used in the cycle is used at multiple stages of the cycle – making it seem not to be a “cycle” at all. For example, one may “Negotiate” on the best date and time for a presentation. And, then may “Close” on the date and time for the presentation.
One of the complexities of managing the sales process is how to keep up with multiple prospective customers that are progressing along their varying steps in the buying process. Because prospective customers drop off for various reasons along the way, there are typically more prospects in the process of being qualified than there are prospects about to close. This concept is typically described as the sales funnel. One of the key metrics of sales management is to monitor the number of prospective customers in each stage of the process and to make sure enough qualified leads are being added to keep the funnel at efficient levels for each stage.