How To Disqualify A Lead
By Steve Johnson
CMO, Primary Intelligence
Reposted with permission from http://www.primary-intel.com/disqualify-lead/
One of the most common reasons for lost deals is trying to sell to a prospect who isn’t qualified. Win/Loss analysis can be a great way to refine your disqualification process.
There are two reasons for doing win or loss analysis. One is to identify issues in a single deal so that the sales team can do better next time; the other reason – the more important reason – is to look for patterns and trends so we can do a better job with all deals in the future. Yet many companies tend to focus on the mistakes made by a single sales team in a single deal. “If you hadn’t done this” or “Why did you do that?”
Even if the deal is won!
(It’s funny. When we discuss win/loss analysis, leaders almost always focus on the losses. But the wins are equally important.)
In our conversations with thousands of buyers, we hear about process problems more often than product problems. Sure, there are times when the product is missing a key feature or the price really is too high, but that’s less often than you might think. In fact, only 10% of customers claim price is a key driver in their decision while 80% of sales people report price as the key factor. Rather than weaknesses in product, we often find the reason for a lost deal is related to your sales and marketing processes.
But what is a process problem?
A common reason for losing a deal is that the client was looking for something else but you tried to sell him anyway. Your internal process refused to disqualify the buyer. You ultimately lost a deal that you should never have pursued. And the most common process problem is a failure to disqualify.
A friend was building an online business. When looking for an eCommerce hosting solution, he found a comparison between two vendors. One vendor listed specific features they had that the other did not, such as bundling and re-ordering capabilities. Happily, both vendors offered a 30-day trial and my friend soon discovered that one vendor had a ready-to-use, template-based solution while the other offered an eCommerce toolkit. He chose the template-based solution instead of the toolkit. Now, there are many people who need to add eCommerce to their existing web site, but that wasn’t my friend’s issue. Was this a loss for the toolkit vendor? I don’t think so. This was a deal the toolkit vendor should never have pursued-it should have been disqualified by process. They have a nice solution; it’s just not the right solution for this buyer.
It reminds me of when I walk by the shoeshine stand at the airport. I’m sure they do a good job but I’m generally not wearing leather shoes. They offer a great service; just not one that I need. And I can tell the guy has quickly disqualified me. One glance at my shoes and he ignores me. He knows he should focus on people who might actually get a shine.
Oh, and another one. My wife & I were looking for decorating ideas so we toured a few open houses, figuring we might learn some clever techniques. In one house, the sales rep walked up, said, “We do custom houses starting at a million dollars. Look around and come find me if you want to know more.” My wife was incensed! “He doesn’t think we can afford this house,” she complained. And I said, “He’s right! We can’t!!” I’m sure they build nice houses. It’s just that their houses are not in our price range. And why should he waste time with someone incapable of buying?
Shouldn’t your sales and marketing teams do the same?
While many sales teams attempt to qualify deals to fill their pipeline, sadly many put on their “happy ears” and hope that the deal is qualified when a few simple questions would quickly show that the sales team is wasting their time.
After the initial contact, the inside sales rep or marketing team should know the answers to these questions:
Does this person need our current solution?
What is this person’s role in the buying process?
What is this person’s timeframe for making a decision?
No amount of wishing and hoping can change the answers to these questions.
The first person to speak to a new lead should look to disqualify those who cannot buy. Your sales team’s time is too precious to waste. Make sure they’re spending their time on deals they can close.
About The Author
Steve Johnson is Chief Marketing Officer for Primary Intelligence with a focus on instilling best practices in win/loss analysis and customer experience. His ideas on customer interaction help companies incorporate market facts into their product creation, marketing programs, and sales enablement. Prior to joining Primary Intelligence, Steve personally trained thousands of product and company leaders on strategies for creating successful technology products. Steve is a popular keynote speaker at forums throughout North America and author of many articles on technology product management and marketing.
