By: Act! Blog | 5/08/2018
A sales process is a series of phases or steps which a prospect goes through, before becoming a customer. If you have been selling for a while now but don’t have any agreed-upon sales process, there is still one implicitly in place; it’s just not standardised and/or visible to you. A properly laid-out sales system provides your sales team with a concrete set of steps to follow whenever they approach a prospect and this helps them in closing more deals. Vantage Point Performance and the Sales Management Association conducted research which revealed that companies with formally documented sales processes observed 18% revenue growth compared to their counterparts with no such procedures. With that said, creating a standardised sales cycle with definite sales process steps can be tough because different team members can have different opinions and there can be plenty of diagrams and figures to consider and client behaviours to incorporate. In addition to this, a reusable sales process has to be reviewed periodically in order to maintain its relevance and effectiveness. Some of the factors that inhibit the building and sustenance of a sales cycle can be:
Different sales processes can have different stages and no one-fits-all solution that can be applied to every company. Depending on your business model, client behaviours and sales strategies, you have to come up with the perfect set of sales process stages for your company. Using a sales software or a sales CRM for this purpose can be highly beneficial. An example sales process can consist of the following stages:
Sales processes and sales methodologies often go hand in hand, but that doesn’t mean that they are the same thing. A sales methodology defines actionable steps for goals and objectives. For example, if your goal is to ask questions of the prospect and get valuable information; for that you can use the SPIN selling methodology made by Neil Rackham which provides you with a tested system to ask questions. Unlike your sales process, a sales methodology isn’t normally applicable to all the parts of the sales cycle; instead, its relevance is restricted to specific stages like contacting, discovery or proposal etc. Another difference between the two entities is that every company should come up with a unique, formalised sales process for itself which will not be relevant to any other company, but a sales methodology is something that can be adopted by any company or team, regardless of their vertical or business model. Some other examples of sales methodologies are: N.E.A.T. Selling, Conceptual Selling and SNAP selling etc.
Now that we have seen what a sales process is and how it differs from a sales methodology, let’s take a look at how any company can come up with their own standardised version:
In order to create plans for the future, often the most prudent technique is to observe the past. Go back a few months, analyse the deals you closed and notice the most important steps that your salespeople followed. Calculate the average time it took to, for example, convince a prospect that your product is the answer or make them agree to your submitted proposal etc. Find out the overall time it took to close the deal and find out the stages where most of the time was spent. After careful analysis, you should be able to figure out details like:
These details can help you formalise your sales process.
No two prospects are similar so it’s difficult to agree on a generic sales process but most of the time, the observations can be mapped to create a generic example. For example, you can say that for Prospect A, two days are spent during contact, one day is spent for demo and so on.
For every stage you define, you need to have a solid reason why and how a prospect moves from the previous stage to this one and from this one to the next. Questions like the following can help:
While calling different prospects, were there any specific notions which when raised, convinced people to schedule a demo?
When you submitted the proposal, did the customer immediately agree? If yes, then what were the exact steps that you followed before the proposal?
The market changes with every passing day and so do your customers’ expectations. Creating a standardised sales process is a never-ending job and hence, you have to monitor your sales cycle every now and again to ensure that it’s still relevant and still upholds the initially set-out standards of efficiency.
It’s also a recommended practice to define metrics that can help you measure the success of your sales cycle. Examples can be: the number of prospects that got converted into customers within a week in the last month, the number of prospects that stayed stuck in the proposal stage for over a week in the last two months and the total number of prospects that got converted into customers in the previous month. These metrics will give you an idea of the areas that need improvement and the ones that have been performing at the highest levels.
A sales process is always going to be a work in process but if you follow some of the steps and tips mentioned above, you can have a substantial competitive advantage over your counterparts. Choosing the right sales methodology can often require a vivid analysis of the customer needs and your business model, but it can help a lot in fine-tuning your sales cycle. Using sophisticated sales software or a sales CRM can also go a long way in your bid to build a standardised sales process.