Question: Has your Sales Organisation formally defined a systematised process and questionnaire for external Win/Loss Analysis reviews with customers – and have current external Win/Loss Analysis reviews with customers improved win ratios?
According to our research at ThinkSales Global, only 13.7% of Sales Organisations have formally defined a systematised process and questionnaire for external Win/Loss Analysis reviews with customers.
In addition, 11% of companies rate their confidence as Outstanding that their current external Win/Loss Analysis reviews with customers have improved win ratios.
The ‘win/loss analysis’ problem
Sales forecasting systems are built to provide sales managers with the information they need to verify the standing of accounts based on the likelihood of deals to end in success or failure.
However, these systems are designed with a single priority in mind – revenue projection. They do not provide detailed information about why deals were actually lost or won. As a result, valuable information that could be used to improve the sales-force effectiveness is effectively lost.
Many salespeople do not take the time to truly understand why they won a deal with a new customer. They assume it’s because of their sales prowess, the client’s buying process or their solution’s functionality. The reality is that this may or may not be the case. They don’t really know why the customer chose to buy.
The same is true of lost deals. According to Steve W. Martin, author of Heavy-Hitter Sales: “Many salespeople do not take the time to figure out why they lost a deal or long-time client. They either don’t know why they weren’t selected or reflexively blame it on factors out of their control. They really don’t know what was on the customer’s mind.”
Without a formalised win/loss analysis, it’s impossible to know with certainty what is and what isn’t working in your sales process, resulting in lost opportunities down the line.
Implement a successful win-loss analysis process
According to research by Aberdeen Sales, organisations that do win-loss reviews outperform those that don’t in most metrics including:
- Customer retention rate (60% vs. 48%)
- Percentage of sales executives attaining quota (51% vs. 47%)
- Lead conversion rate (23% vs. 17%).
Here are all the reasons why you should be implementing win-loss analyses:
- A win-loss analysis is the best way to understand what is really on your customer’s mind.
- Since most corporate sales processes are complex and require the investment of manpower, time and money, it’s critical to understand why deals are won – and lost.
- The best way to achieve this is through extensive customer interviewing. Collecting feedback from buyers and sales teams is best practice because it allows sales leaders and company executives to understand a complete picture of the win or loss experienced by their team, allowing them to leverage strategies that their sales executives are doing well and correct areas that are causing losses.
- Companies that report collecting win-loss data only from sales executives report low confidence in the data. Unfortunately, many sales executives don’t know the real reasons that cause buyers to select them or not select them.
- Additionally, organisations that collect feedback from both buyers and sales executives have a higher ‘Win Loss IQ’ or understanding of buyers, the buying process and competitors.
- Win Loss IQ categories that are particularly strong include understanding the reasons for winning competitive deals and competitors’ strengths and weaknesses.
It’s not just business. It’s personal. If you are considering launching your own Win/Loss Analysis programme, you may want to involve a third-party ambassador to assist you.
Best practice dictates that a third party conduct your win/loss interviews with both customers and sales executives – either an internal asset who was not involved in the sales process or an external company that will conduct win/loss interviews on your behalf.
Prospects are likely to be more candid when giving feedback and criticism to an independent third party because they need not be concerned about hurting the salesperson’s feelings or fearing confrontation, criticism or reselling efforts from sales executives, who can become defensive while receiving negative feedback.
Providing prospects with the option to remain anonymous in their feedback to a third party may also invite them to share issues more freely pertaining to the salesperson, sales process or a company’s products or services.
Assess the health of your sales organisation
Defining a systematised process and questionnaire for external Win/Loss Analysis reviews with customers and using them to improve win ratios 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™.