“I’ll let you know.”
After weeks of in-depth discussions, back and forth negotiations, and answering an endless stream of questions, you’re hit with this ice-cold response.
This response stings.
It’s especially painful if you’ve invested a significant amount of time or resources during the negotiation process. It’s discouraging and soul-crushing to see prospects with a competitor after they’ve used you as leverage to get a better deal.
It’s a consistent problem for sales teams.
Here’s the good news: problems like these can be reduced dramatically or eliminated entirely if you build a data-driven sales team.
What do you mean by "data-driven sales?"
The term “data-driven;” what does it mean?
Data-driven sales teams collect data from each customer interaction; they use the data they collect to make important decisions, chart course corrections, and direct focus.
If you’re part of a data-driven team, you can answer specific questions about prospects or your funnel on the fly. These are the kinds of questions that, when answered, provide direction and clarity.
- Is this prospect qualified?
- Have we received clear buying signals from them?
- Are these prospects more or less likely to accept our upsell?
- Which prospects should we disqualify?
- These prospects are haggling over price; should we keep them or dump them?
- Which objections scare prospects away?
- Which lead source wins customers with shorter sales cycles?
Still with me?
What is an example of sales data?
Here’s a short list.
- Sales/revenue by lead source
- Number of deals/sales lost to a competitor
- Cost of sales
Can you see what’s happening?
The majority of these metrics are based on revenue. The basic question here is, does it make dollars and cents to pursue these prospects?
This is essential.
If you’re collecting data on customer interactions, there’s an incredible amount of information you can learn about your prospects and your customers.
But only if you have the right tools.
Tools like CRM and analytics software make the data collection process simple. More organizations have started to adopt these tools, but few can use these tools effectively.
But why would they?
Why you need a data-driven sales team
Data-driven companies dramatically outperform their competitors. According to research from the Mckinsey Global Institute, data-driven organizations are:
- 23x more likely to acquire customers
- 6x as likely to retain customers
- 19x more likely to be profitable
- 50% have sales well above their competitors
- 6x more likely to achieve positive returns than competitors
When we look at the numbers, the value is pretty obvious.
Data-driven teams attract more customers, make more sales, and bring in more revenue. They’re more valuable to their organization, and they can generate a significant amount of value.
All that from tracking data?
A data-driven sales them can track two types of customer data that, when combined, paint a clear picture about your customer’s interest and engagement. These markers are:
- Behavioral markers: Include sub-categories like customer admiration, engagement, or relationship. Do your prospects or customers exhibit signs that they love your company or express a certain amount of pride of ownership (i.e., Tesla or Apple customers). These markers are a great sign. It means customers are more likely to be open to what you have to say.
- Outcome markers: Outcome markers are verbs; they refer to your customers’ actions throughout the customer journey or relationship. These outcome markers could be profit margins, purchase frequency, revenue per customer, repeat sales by customer, monthly spending, product consumption rates, etc
Aren’t sales teams using this?
A few are.
But many salespeople still rely on intuition and guesswork when making sales. This can work if you have the experience to back it up, but it’s certainly not a scalable system for the future.
The data you'll want to track
Which metrics and KPIs are most important for you to track?
It depends on your organization.
Here’s a list of sales metrics you can use in your organization. You’ll want to start with ten of the most important metrics and measure those. Add more metrics on an as-needed basis; avoid overwhelming your team with useless data.
- Conversion rates (per salesperson)
- Total revenue
- The average revenue per customer
- Sales/revenue by lead source
- Number of deals/sales lost to a competitor
- Revenue by market
- Cost of sales
- % of revenue from new vs. existing customers
- Revenue per customer
- Revenue by product
- Revenue per sale
- Churn rate
So how do you use this data to attract new customers and increase sales revenue?
At first glance, it seems obvious.
Just look at the metrics above and then figure out how to improve them (duh)! In reality, it’s not that simple. You’re customer-facing, but that doesn’t mean you have the authority you need to make company-wide changes.
This is a frustrating position to be in.
For example, let’s say customers have an issue with delivery; they feel product delivery costs too much and takes too long. It’s a legitimate complaint, one you’ve brought up with management several times in the last quarter.
What if you don’t have control?
How are you supposed to improve sales if customers have legitimate objections that management refuses to address? Is that even possible? It sounds like an impossible task.
You already know the answer.
If you’re a data-driven company, you need to collect, that’s right, more data. When you combine data and incredible sales skills, you become a persuasive force that sways management, earning their buy-in.
Here’s what that looks like:
Manager: So we missed our last earnings projections; what’s going on? I thought we were on track to hit that easy.
You: We were. Our sales team worked through 1,517 leads last month. We surveyed half of the customers who decided to go with a competitor. Most of them raised the same three objections (delivery times, delivery costs, and poor communication).
Manager: Okay, yeah, I remember you mentioning this during the last two meetings. Could you send me a copy of this report? I want to forward it to…
You: Sure, these customers also told us they’d be willing to switch if we…
See what I mean?
Marketing will naturally shift the blame to you (they couldn’t close the sale). If you enter meetings armed with data, you’ll provide management with the motivation they need to make changes.
What if you don’t?
The sales and marketing blame game becomes a likely scenario that creates silos and internal turf wars. Marketing complains that your sales team can’t close the leads they send, and your salespeople state that the leads are terrible.
How data-driven sales teams can increase sales by as much as 23x
This sounds impossible until you see how it’s done.
It’s pretty boring.
It’s not a sexy or innovative strategy; the tactics I’m about to share are so mundane your sales team may be tempted to ignore these ideas or roll their eyes (we’ve already done that).
That would be a mistake.
Instead, I’m asking that you (or your sales team) give this a shot for 90 to 180 days. If you don’t see a significant improvement, stop doing it.
Here’s how it works.
Step # 01: Build relationships with other departments
You’ll need to have good working relationships with co-workers in other departments. As a general rule, your sales team should have good working relationships with co-workers in:
- Customer service
You’ll want to be on good enough terms with co-workers in these departments that you can request (and receive) information or data from them when you need it.
Step # 02: Build your tool stack
The more actionable data you can get your hands on, the easier it is to close sales. Remember the list of metrics I mentioned earlier? That’s the tip of the iceberg. With the right tool stack and good relationships with other departments, you’ll find closing sales becomes a no-brainer for your team.
Which tools do you need?
- CRM: Your customer’s feedback and behavior provide you with the specifics you need to focus your attention. Properly used, your CRM should be able to show you where you’re losing sales and how to improve. Your CRM is also important because it identifies your top salespeople and the areas where they perform best (e.g., prospecting vs. presentations vs. closing).
- Web analytics: It’s a good idea to share web analytics data with your sales team. Good data analysis means you’re better able to expose hidden trends that customers aren’t sharing. Are customers spending a significant amount of time on certain pages? Which questions do they ask most often? What are their most common objections?
- Review management software is about scale. Individual salespeople can read through competitor reviews on their own. Review management software enables you to do it quickly and at scale. Use competitor reviews to identify customer desires, goals, fears, frustrations, objections, and risks. Spot competitor weaknesses and failures, and use negative competitor reviews as part of your sales pitch.
- Q&A sites like Quora or Answer the Public provide you with customers’ specific questions about your business, product, service, or industry.
- Interview tools: Tools like Dialpad meetings, Survey Monkey, Typeform, and others provide you with the access you need to jump on a call or chat with customers instantly. Conduct formal and informal interviews, get feedback, and win back disgruntled customers with these interview tools.
See the trend?
These tools are all about uncovering customer data. This list isn’t a comprehensive toolset designed to help you with administrative tasks like finding emails.
This is about customer feedback.
Step # 03: Identify sales bottlenecks
You’ll want to use the tools you’ve curated and the relationships you’ve built to find and address key sales challenges before they become an issue. Remember the problems you’re looking for?
You’ll want to identify the customer:
- Desires: The deeper emotional issues driving customers to purchase your product or service. I want to beat a specific competitor; I want to show naysayers I’m better. I want to look and feel good in a bikini, etc.
- Goals: These goals are tied to the deeper desires you’ve just mentioned — I want a $30,000 raise, I want to lose 50 lbs before my high school reunion, etc.
- Fears: These are the unspoken issues that keep customers up at night. I’ll lose my job, and if this product doesn’t fix my problem, I’ll be out of business, etc.
- Frustrations: These are issues customers have encountered with your business, a competitor, or elsewhere in your industry. This could be a minor complaint (e.g., not displaying prices online or difficulty getting someone on the phone or on chat) or a major complaint (i.e., your customers are angry about your political stance or a social faux pas someone in your company made).
- Objections: These are the issues that act as barriers to the sale. These objections typically fall into one of seven areas — price, politics, timing, trust, urgency, disinterest, and leverage. Customer objections usually come from their perceptions, past experiences, or inexperience. These objections, when answered, provide customers with the peace of mind they need to buy with confidence.
- Risks: There are two types of risks to customers: Obvious risks (i.e., the product or service fails to perform) and hidden risks (i.e., my information is being sold without my permission). Risk reversals function as the canary in the coal mine. They relieve customer fears and risks to customers by providing them with specific benefits that minimize recalls, refunds, and returns.
Got all of that?
When you go through the list of these items, you’ll want to reach out to your allies in other departments to address each of these issues. For example, imagine that customers are nervous about delivery and fulfillment times for your ecommerce store. They’ve read reviews and are unhappy with what they’ve seen.
That’s an issue you’ll need to address.
Step #04: Tell prospects what you've done
When prospects voice their opinions or mention their concerns, use the data you’ve accumulated to address their concerns in a way that satisfies them.
Create contrast where you can.
Show them that you have an in-depth understanding of their issues, then show them how you’ve already addressed the issues on their behalf. You obviously don’t want to volunteer problems, but it’s a good idea to address these issues before they metastasize into a dealbreaker.
These are easy steps you can take to increase sales.
It’s a data-driven approach that increases sales, boosts revenues, and improves customer retention.
Data-driven sales teams are the antidote to poor sales
“I’ll let you know.”
It’s the classic response used by tire kickers, time-wasters, and knowledge vampires. Data-driven teams see them coming a long way off; they allow customers to self-identify.
A data-driven approach reduces or eliminates these headaches.
With a steady stream of data and the right approach, you’ll find it’s easy for your sales teams to improve performance, no ghosting necessary.