Quite often when we speak to a client it turns out that their company is developing fast, it gets all kinds of industry awards and it has an interesting client portfolio, but their CEO is ambitious and wants to do everything quicker and to an even larger scale. So they work on developing their sales because the portfolio, development and awards result directly from what they sell. The biggest obstacle on their way to improving their sales is the fact that the time of the CEO, who actively participates in the sales process, is limited and he or she cannot fully focus, because they have to divide their attention between both sales and management duties.
The result is that they cannot conduct most important sales negotiations as well as they’d like to and it’s difficult for them to find time to define what their sales results depend on – how to predict a slower month or correctly identify the best leads which should be prioritised. Don’t count on them to respond to that e-mail too quickly. Those are the problems which some companies face when they turn to Casbeg.
Let’s see how reorganising of their sales processes influenced some of our clients.
Not measuring performance is a trap
The first step to improve your situation is a careful analysis of your sales data. Usually, it turns out that some elements of the puzzle are missing from the picture – sometimes, preparing basic sales metrics takes us as much as several days of manual work, even though there are CRMs in the market which allow for automated or semi-automated data gathering. This is the first sign that sales are only delivered on the basis of experience (which is important), but there is no way to draw objective, non-biased conclusions uninfluenced by any emotions, using data regarding conversion, duration of the sales cycle, reasons for why clients turn away or information on how and when clients reach particular stages of the sales process.
The lack of this information usually costs the time which is spent on nurturing useless leads. It also results in lost opportunities for landing the most valuable contracts, because they are usually identified too late, or because those accounts were not taken care of properly. Consequently, the CEOs who actively participate in the sales process fall into a loop. They have no time to measure, so they don’t draw conclusions. The lack of conclusions leads to a situation where instead of speaking to those clients which are most promising, they speak to all prospective clients, which is a waste of time, and because of that, they have even less time to focus on the metrics.
Identifying mistakes in your sales process
To gather data you need a CRM with a properly composed sales process – usually it turns out that a rigid structure of the sales process does not allow for clear analysis of data, so in practice, in order to actually analyse the data you have to amend your funnels and sales stages so that they actually reflect what is going on while you strive to gain more customers. Reliable and legible insight into the state of your sales is particularly useful for selling CEOs, who should have a simple way to access all this information.
What to look for when all the data is in place?
When you analyse the profitability of all of your projects and verify the characteristics of your most profitable customers it usually appears that they have at least several common attributes. In one case these were US and UK based startups with a particular set of problems. In another case, it included large domestic companies which all faced a similar problem related to having a certain type of decision maker.
It can also be the case that when an offer was presented to those leads where decision makers were not engaged in negotiations, only 1 in 15 of such offerings ended up in a purchase. Considering that each of these talks took 30 minutes of preparation and 1 hour to be summarised, processing of all these leads took the CEO 22,5 hours – since conversion from the number of offers presented to a signed contract amounted to about 6%, the invested time (in case of that company) brought no significant return.
Learning about the reasons why clients to leave
One thing that is often overlooked is the lack of metrics regarding lost opportunities. The time of the CEO is too valuable for them to spend it both on managing the company and on sales, and they could not say what percentage of leads were lost due to the price being too high, or how often competitors won the customer over.
Lack of profitability analysis
When we spoke to CEOs about the services which their companies were offering, it often turned out that they don’t pay enough attention to measuring the profitability of their projects. They did not know what margins they achieved in which of their projects. When we managed to tidy up the data it proved that the company actually did not make any profits on some of their services, or I made very little. As a result, the client closed one of their departments based on our recommendation and directed their focus and efforts on more profitable product lines.
When you have information regarding:
- the characteristics of your most profitable customers,
- which leads are not worthy of your time,
- why do potential customers make their purchases…
… you can identify specific steps – those which you must take in order to improve the metric which often falls below expectations, one which indicates the level of conversion from leads to customers.
After several weeks of conducting sales with the improved process and with the use of a CRM it appears that the CEO has access to a clear view of the sales process within their company: not only they gain access to more information, but the information is more readily accessible. Because they now have their data within arms reach they start paying attention to things which they could not see before. For example, they can see much in advance if the current month will end in a positive sales outcome, they can also say why the result will be good or bad. They know when it makes no sense to become fully engaged in talks with a particular low-quality lead, and when they can use their time in a more productive manner.
To learn more about analysing sales in your company you can read the following articles: 5 best practices of using CRM as a CEO and How to measure sales if you get less than 50 leads.