How to Improve your “Close Ratio”
Operating within the business-to-business (B2B), consultative sales world? Does your sales team “close” the majority of the opportunities they pursue? Meaning that more than half of the proposals/bids you submit result in new contracts?
If not, here are five possible reasons … your sales team may be:
1. Talking to the “wrong companies”.
2. Talking about the “wrong benefits”
3. Talking about the “wrong solution”.
4. Talking to the “wrong” people.
5. Failing to follow-up.
What can be done to improve your company’s close ratio? Let’s look at each of these situations individually.
1. Talking to the “wrong companies”. First you must know the profile of your “ideal customer”; the more detailed the description the better. Ideally, your profile will include the type, size and location of your “ideal customer” as well as the challenges they are facing/problems to be solved and the culture/business philosophy of the companies that are your best customers. A systematic prospect qualification process will identify companies that fit your “ideal customer profile” in terms of needs, wants, readiness and ability to purchase. This process can be implemented through your inbound call center or through outbound calls to prospects. Prospects who do not fit your ideal profile can be directed to alternate sources leaving your sales team to focus on qualified Ideal customer prospects. Prospects who do fit your ideal profile but are not yet “ready” can be nurtured through automated processes until the time is “right”.
2. Talking about the “wrong benefits”. A preliminary assessment of the prospects objectives can be performed during either inbound or outbound calls with the prospect. When the prospect’s profile matches that of your “ideal customer” AND the prospect’s needs, wants, willingness and ability to pay, can be met by deploying the benefits of your solution, the probability of closing the sale is enhanced.
3. Talking about the “wrong solution”. The information gathered through the qualification process should identify the prospect’s specific needs/wants as well as the available budget ~ the sales team is responsible for matching the best solution to the needs/wants and budget. Your solution may not be the best solution for the prospect – better to opt out than persist in trying to sell them.
4. Talking to the “wrong” people. This can be a delicate problem to solve. Often the people who call your Contact Center have been assigned the task of information gathering only and they may have little or no authority in the actual bid/RFP evaluation. A critical element of the qualification process must be to identify the key individuals who will be involved in the decision, what level of authority they have and what their specific roles will be.
5. Failing to follow-up. Prospects expect that your sales team will follow-up to answer questions, to demonstrate your interest in their business. How your team treats the prospect during the bid/RFP process tells the prospect what they can expect once they become a customer.
To diagnose the specific areas for improvement within your own organization, you may consider a Wins and Losses Analysis where prospects are asked for their perspective on the process and how it could have been improved. Through conversations with your prospects, the reasons for winning and for losing new business opportunities can be determined and processes developed to address the challenges.
Having well organized and active qualification and nurturing processes will put “warm and ready” ideal customer prospects, in the hands of your sales team for development.
Having systematic processes for matching your solutions with the prospect’s wants, needs, willingness and ability to pay will improve the likelihood of success in securing the business.
With increased efficiency, your sales team will have time to ensure that every RFP/bid submission is followed-up with the prospect.
As you can see, improving your “close ratio” is a multi-faceted, continuous process and should be viewed in the context of building long-term, competitor resistant relationships with companies and individuals who fit your “ideal customer” profile.
The Dunvegan Group works with B2B companies to improve customer retention using The Platinum Rule®, “Treat other people the way they want to be treated.” Learn more about our solution.
Anne Miner founded The Dunvegan Group in 1987 as a full-service marketing research consulting firm. Under her leadership, the company has adapted to changes in the markets, advances in technology, and economic ups and downs. The firm developed its own processes, metrics, and software to support the services it delivers to Business-to-Business corporations, as well as smaller companies, including start-ups. The company serves clients across North America and around the world as they thrive and grow through serving their own customers according to the insights customers provide.