The Reasons You Win Are the Reasons You Lose

Ask any sales rep why they won a deal and they will answer with a variety of answers. They will say they won because of relationship, a great demo, out selling the competition, etc. They will never say they won because they were the cheapest price. No one ever comes back to the office, rings the bell, and says "I won because I was the lowest price."

However, ask a sales rep why they lost and 9 times out of 10, they will know it... price. The fact is no one ever wins or loses because of price. There are always, always other factors involved. Sure, price may be one of them, but it is never alone. Everyone who has been in sales for any period of time has gotten both of these calls from a customer at some point:

Call 1 -- "Hey Ed, this is Jim, we are ready to buy, but I need you to be at price X. Get me that price and let's get the paperwork done."

Call 2 - This "call" is often an email, because customers don't want to tell you that you lost in person. "Hey Ed, this Jim, we decided to go with your competitor. Sorry Ed, you did a great job, we just felt it was best for the company and they were cheaper."

Why do you get Call 1? Because you have done a number of things right. Most likely, you have established a relationship better than your competition and demonstrated greater value. You have earned the right to get this call and understand the REAL price point at which the customer will buy.

Why do you get Call 2? Because the competition has done a better job, has a better relationship, and earned the right to get Call 1 instead of you. Notice in Call 2, he told me the competition was cheaper. Often that is either a lie, or an expression of the fact that he shared the buying price with someone other than you. No one buys on price alone.

Now that we know it is not price that wins...why do you win or lose? To win your reps must do the following four things:

  1. Establish credibility and relationships with the right level of decision maker.
  2. Understand your customer's business issues and requirements.
  3. Present the right solution to meet the customer's requirements.
  4. Convey your value proposition effectively. In other words, do a good job of selling and not a bad job of selling.
The challenge with this list is that it is not easily measurable. As managers, you must focus on things you can measure (and therefore have an effect). We determined that the best exercise to measure how your reps are doing with a deal is establish 10 tangible steps that help you win. This is very important because it will a. increase your win rate, and b. improve your forecast accuracy. Unfortunately, I cannot just give you a pre-done list of your 10 tangible steps because these vary based on your company and your industry. Below is a sample list to give you some ideas of what should be in the 10 steps. Note that anything that goes on this list must be a. tangible, b. measurable, c. easy to determine.

10 Sample Steps -- In no particular order

  1. Account research done prior to first call
  2. Proposal presented to the decision maker
  3. Customer has been qualified for credit and chosen method of payment
  4. Demonstration has been attended by the decision maker
  5. Customer's business issues have been identified, documented, and agreed to by the decision maker
  6. Time frame to make a decision has been identified and agreed to by the customer
  7. Customer has agreed that the proposed solution will solve their business issues. This may be done via a business case, return on investment exercise, or some other method to establish proof of concept.
  8. Customer has contacted references
  9. Strategic resources have been engaged such as service, a vendor resource, a technical analyst, etc.
  10. Customer has attended an event or trade show with you.
Once you establish your 10 steps, you can then use them when discussing a deal with your reps. You can start to make managerial judgments about your reps chance of really winning a deal. For example:
  • If a rep has completed less than 50% of the steps, your chances of winning are likely zero.
  • If a rep has complete 50% to 70% of the steps, you likely have a 50/50 chance of winning.
  • If a rep has complete 80% of the steps or greater, you likely have an 80%+ chance of winning.
These results will vary slightly, but they are a solid indicator that will give you the ability to help your reps win more and improve your forecast accuracy (good management!).
Ed Cowdrey
Ed Cowdrey> website | all articles
National Sales Leader with the following Experience and Qualifications:
* Recognized for training sales managers and knowledge sharing on The Sales Manager Guide to Sanity (free blog).
* 20+ years of exceeding sales expectations coupled with a successful track record of leading others to do the same. A demonstrable history of innovative, strategic business development, revenue growth, and surpassing goals.
* Have had the privilege of learning from World Class Organizations, including Ricoh, Kodak, and Xerox.
* Cross-Functional depth and experience managing multiple teams responsible for Sales, Marketing, Customer Service, Operations, and Services.
* Extensive experience leading, selling, and delivering product solutions across multiple industries, growing revenues, and profits year after year.
* Proven success in turnaround of underperforming business units and building new organizations.
* Successfully managed up to $60 Million in revenues with profit and loss responsibility.
* Enjoyed repeated success in organizational agility developing relationships, new programs, and products.
* Enjoyed being a small business owner recently and learned allot about the differences between big companies and small companies.

  • /_ckcommon/images/blanks/userPicture.jpgDebra Colgan1/9/2014 7:02:44 PM
    i'm sure this article provides some great advice, however you lost me at "loose".

  • /data/userPictures/11809575-E922-49AE-AEC4-8519CA0D09CC.jpgEd Cowdrey1/9/2014 9:22:07 PM
    Debra, thank you! You caught an error that even my high priced editor didnt catch so thank you very much. The book is getting ready to go into publication and you just saved me some trouble! I am curious what you thought of the content? The CEO of a Fortune 1000 company called it "the most practicle lesson for sales managers". We would love your feedback.