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Little Sales Cycle of Horrors


“Feed me, Seymour!”

No, it’s not the roar of a giant, man-eating Venus Flytrap. It’s your funnel calling.

Keeping the sales funnel full (that is, making sure you have new prospects and likely buyers in your pipeline at all times) is a hallmark of successful salespeople. But the funnel’s hungry - constantly.

Generating and tracking multiple opportunities at various stages of the sales cycle can be challenging, and sales professionals commonly find themselves in a dangerous, month-to-month revenue pattern of feast or famine.

“You have a phenomenal amount of business closing one quarter, then have to scramble to barely make quota in the next,” says Tim Basa, director of business development at Telegration Inc. “Call it boom and bust, peak and valley, or the Roller Coaster Effect, the outcome is the same: You can’t make realistic forecasts of future revenue because of your dried-up opportunity pipeline.”

Rather than taking on the care and feeding of the demanding beast that is the sales funnel, many salesfolk see such cycles as part of the business. But dry months can and should be avoided with daily, weekly and monthly follow-up and prospecting habits. Basa adds: “In any given week, in order to survive in selling long-term, you’ve got to attend to basically three categories of business opportunity: new business, business that’s somewhere in the middle of your sales cycle and business that’s getting close to the contract stage.”

A common pitfall is closing deals first, working ongoing opportunities next and prospecting last. Basa notes this is dead wrong. “In fact, that timehonored and logical order will almost definitely ensure that you’ll encounter dry months,” he says. “Because you save the ‘unpleasant task’ of prospecting until last; and when you do, it always gets short end of the stick.”

Letting a week go by without leadgenerating activities can be devastating. For steady income, some time every day of every week should be focused on cold calls, direct mailings, cutting out articles and mailing them to prospects, dropping off or mailing brochures, asking for referrals or other prospecting tasks.

“It’s a numbers game, and the more calls you do, the more turn out, whether that’s in person, cold calling, mailing things out,” says Kieren McCobb, president of master agency Teleconfusion Removal Inc. “Some will be interested and that’s a fact. But you can take steps to keep things warmer than that.”

McCobb says paying attention to the business sections of several newspapers is one way to prospect. “Mergers and acquisitions could give you a reason to call up and ask to talk to the IT manager,” he says. “Also, companies that are expanding or moving [are good prospects].”

The best possible way to get not just a warm lead but a hot one is to ask for referrals. “Ask for three names and numbers of people you can call up and use your customer’s name with,” says McCobb. “If you do that, you’ll never cold call again.”

Another easy way to prospect is to do a mail campaign. “You can send a wake-up call to existing customers, who may have forgotten what you can do for them,” says Stacey McCormick, director of sales at World Telecom Group, a master agency. “We are all so inundated with phone calls and e-mail, so mailings put something physically in hand. In the holiday season, when things traditionally slow down, hit up existing customers with an offer for audioconferencing or cellular service, offers that have a quick turnaround and limited decision criteria. Thank them for their business. Then follow up with a phone call a week later. Mail 10 to 15 letters a day.”

As important as prospecting is in keeping the sale funnel satiated, closing ripe business is the top priority. “You’ve got to make working the opportunities at the top of the pipeline a higher priority,” Basa says. “[But] not your first priority - that should remain closing immediate business.”

Many salespeople get bogged down with chasing the big game sales - the elephants that translate into gigantic commissions. The problem is that salespeople pursue these accounts at the expense of other deals that generate revenue in the short term and make the funnel work. In any given month, a salesperson working for 10 percent to 15 percent commission should have about $100,000 in the funnel, and should close about 25 percent minimum, notes McCormick. That usually translates into working 20 to 30 prospective customers every month, leaving little room for elephant hunting. “The first priority is to take all the steps necessary to make the sale happen with each prospect. You identify the revenue-generating customers, i.e. those who will close quickly. There’s a tendency to ignore those, because they are lowmaintenance. If you focus on the elephants, or the ones that are more complex and take more time, suddenly you’re ignoring an awful lot of smaller sales.”

Taking control of the sales cycle is also critical. Sales training company Peak Performance LLC compares moving the sales cycle along to deciding how to react should a finger fall off, the finger being the business problem the salesperson can solve for them.

“When you come across someone who has a ‘cut finger,’ it is your job to determine how this pain is affecting the prospect or company,” says one of Peak Performance’s Web-based training documents. “It is your job to uncover how not handling the matter may cause infection later on, thus leading to a more expensive and serious situation moving forward. It is your job to uncover how, in the past, when they did nothing about the matter, or decided to do what they always have done in the past, hurt them financially or otherwise.”

In other words, salespeople can create a sense of urgency that motivates. “If the prospect perceives the injury as something more substantial, you are far more likely to get some action out of that prospect - after all, when an individual cuts off their finger, all thought stops and action takes place,” says the company.

It’s also important to realize that not all customers or services have the same cycle characteristics. “The customer dragging his or her feet creates problems,” says McCormick. “Your funnel may be filled, but you’re not closing. You have to manage the sales process, but it’s not time management, it’s opportunity management.” McCormick advocates having a general idea of how long it takes a sale to close. Integrated access for a medium business may generally take about 30 to 40 days to close, for instance. “So it’s about your own personal work habits. That’s how to figure out how to focus on the right opportunities in the funnel.”

The third priority of successful salespeople - managing opportunities in the middle of the sales cycle - includes qualifying leads to find those right opportunities and not to waste time on deals that will never materialize. “The No. 1 qualifying question is, what are their buying criteria?” says McCormick. “In the revenuegeneration area, you should determine the buying commitment level; select those that are likely prospects; then, move each one into the final stage.”

One of the most important things is knowing what to keep in the sales funnel in the first place, says McCobb. “If you can’t get your message across, go on to the next one,” he advises. “Some companies will ask you thousands of questions and never close. Learn to walk away, and let them waste the competitor’s time.”

Finally, streamlining processes, hiring administrative help or outsourcing lead generation can help salespeople balance the multiple dimensions of funnel management. For instance, services like BroadBandBuyer.com’s new lead-generation program, launched in October, can save salespeople valuable time. The company, an online entity that helps businesses find and comparison-shop for telecom services, says the program provides qualified leads for VoIP, VPNs, DSL, T1 lines and other services in a cost-per-lead model.

Using a combination of industry contacts, brand name recognition and targeted online and brick-and-mortar marketing initiatives, the service can produce 600 leads per month per company, with an average 10 percent close rate, Ferraro says.

“The rule of thumb is, you spend most of the time prospecting and working customers,” says McCobb. “You want to maximize your face-to-face time. You can streamline proposal and presentation generation by carrying a laptop and doing auto-quotes with special software.”

PHONE+ offers a free web pricing and proposal generator in concert with 1800SAVE.com. An agent can enter his clients geographic area and the desired product, then 1800SAVE.com is able to qualify which carriers service that area, the price for the service and the commission payout. The agent can then compare and narrow down the carriers, and 1800SAVE will create a customer-ready proposal. The proposal can be printed or e-mailed directly to the customer. Proposals are saved for 90 days. When the customer decides which carrier to use, the agent can go back to the site where the proposal is saved, use that information and generate the paperwork.

Feeding the sales funnel beast is daunting, with requirements for lead generation, qualifying, managing opportunities and closing deals on 30 prospects per month, every month. Successful salespeople learn to tame the funnel - before their revenue projections become a horror show.

THE CHARACTERISTICS OF SOLID SALESPEOPLE
Two sales professionals lent their thoughts to PHONE+ on the best funnel-filling activities

According to Tim Basa, director or business development at Telegration Inc., successful salespeople:


  • Tim Basa

    Work the phone - every day - in the car, at the office, while they are waiting for their ham sandwiches.

  • Mail postcards with interesting facts, quotes or promotions.
  • Have a personal newsletter.
  • Have a personal Web site.
  • Follow up relentlessly.
  • Attend networking events - to network! Not to shake hands or to drink.
  • Cut and mail interesting info to prospects.
  • Ask everyone for referrals - friends, family, the guy next door and the lady in line next to them at Blockbuster.
  • Hire assistance to help with the administrative tasks so they can prospect, propose and close.
According to Stacey McCormick, director of sales at World Telecom Group, successful salespeople:


  • Stacey McCormick

    Conduct mail campaigns - Send a wake-up call to existing and new customers by letting them know all of the services you offer.

  • Work their local business networks - Sales prospects exist everywhere you have a relationship - the local grocery store, dry cleaner, Chamber of Commerce, PTA.
  • Remember past acquaintances - Keep a tickler file on all contacts and touch them at least four times a year - Hunt for niche prospects - Never rely on one single niche or market segment to make your business prosper. Tap several niches and know that some pay off sooner than others. Focus first on the niches that give faster returns.
  • Build their own prospect lists - One, identify prospect types by category; two, add important qualifying criteria for each category; three, find businesses that fit each category and determine their decision-makers.

Links

BroadBandBuyer.com www.broadbandbuyer.com
Peak Performance LLC www.peakperformancellc.com
Teleconfusion Removal Inc. No Web
Telegration Inc. www.telegration.net
World Telecom Group www.wtgcom.com
1800SAVE.com www.1800SAVE.com


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