Question: Has your Sales Organisation formally documented a process to quantify the cost of a customer’s problem in the absence of your solution – and are your sales executives able to consistently quantify the cost of a customer’s problems in the absence of your solutions?
According to our research at ThinkSales Global, only 16.9% of Sales Organisations have formally documented a process to quantify the cost of a customer’s problem in the absence of their solution.
In addition, 14.34% of companies rate their confidence as Outstanding that their sales executives are able to consistently quantify the cost of a customer’s problems in the absence of their solutions.
The ‘Cost Of The Problem’ Problem
More and more deals are being stalled or lost to no decision. Unfortunately, there is a real cost to in-action on the side of a potential customer.
The problem is that despite Sales Organisations presenting customers with compelling ROI-based proposals, more than 60% of deals still result in ‘no decision’. When this happens to your organisation, you didn’t lose to a competitor – but you didn’t win the deal either.
So, how do ‘no decision’ deals happen? As human beings we tend to be risk-averse and change-averse. Until your customer is convinced that the risks, costs and consequences of staying exactly the same outweigh the risks, costs and consequences of change, they aren’t motivated to do so.
No amount of ROI calculations will change their mind, because even if they trust your calculations (and not all customers do), they’re thinking, ‘sure, I see the ROI, but it’s for a solution that I don’t really need.’
The only way to shift their thinking is to prove the cost of inaction for their organisation if they choose to do nothing
Create A Burning Platform That Drives A Desire To Buy
B2B buyers will no longer approve budget for any product or service that doesn’t clearly demonstrate that the proposed solution will deliver the projected value.
If your sales force is able to prove a financial justification to buy however, they will achieve three key outcomes:
- A sales executive will only overcome risk adversity if they can prove the return on investment (ROI) that customers can reliably expect after implementing your solution
- This will also help them to justify your price to minimise discounting
- And it will satisfy the concerns of finance stakeholders (such as FDs).
This means that in order for your Sales Organisation to close deals, it’s imperative that you are able to offer compelling proof of value.
As a sales leader, you need to equip and enable your sales executives to:
- Create a Burning Platform
- Establish the cost of the problem, particularly if the status quo is maintained.
Sales Leader’s Toolkit
It’s important that everyone on your sales force is able to make the case for change. How does this work?
Let’s assume a sales executive has qualified a lead. They’ve uncovered a compelling need, and have even proven ROI. It’s now essential that they are able to develop and deliver a compelling case for change, and this begins with the costs, risks and consequences of inaction.
In order to do this, each of your sales executives need to learn more about the problem from your customer’s perspective.
Cost of the Problem is a simple equation:
- What is the POTENTIAL FINANCIAL IMPACT of the problems being experienced, current or future that the customer is facing WITHOUT your product, service or solution?
TOP TIP: It’s far too early to jump into a product pitch at this stage. Right now, your sales executive needs to be aiming for consensus that there is a cost of the problem, and more importantly, a cost of inaction. This will require buy-in from the top of the organisation right through to their sales manager – if they are being forced to speed up a deal, they will miss this critical step.
Instead, sales executives need to be comfortable that:
- The customer might not have all the answers to these questions. This is a key opportunity to bring more stakeholders into the conversation
- Ideally, you want your stakeholders to begin thinking about the problem from a different perspective
- The cost of the problem isn’t only a monetary equation – consider other impacts of inaction, including employee morale and customer satisfaction
- Ultimately, your sales force needs to learn to develop and deliver an irrefutable answer to the question, ‘why again are we spending money on this?’
Assess The Health Of Your Sales Organisation
Having a documented process to quantify the cost of a customer’s problems in the absence of your solution and ensuring sales executives are ably equipped to follow the process are two of 322 measures of a world-class Sales Organisation.
How does your Sales Organisation stack up? Find out by taking the ThinkSales 5 Pillar Strategic Sales Assessment™.
This first-of-its-kind 360-degree gap analysis report enables your Sales Leadership team to assess its strengths and detect weaknesses and impediments to revenue growth across the five pillars of a high performing sales organisation:
- Competitive Strategy
- Customer Engagement
- Sales Talent
- Sales Management
- Sales Enablement
Click here for more information on the ThinkSales 5 Pillar Strategic Sales Assessment™.