You’ve got too many deals in your sales pipeline.
If you’re in B2B sales in a medium or smaller business then it’s highly likely you will have a focus on both finding new business as well as servicing and retaining existing accounts.
A lot of the advice given out to sellers is around building out a strong pipeline to make sure that when a deal fails, regardless of how far through you pipeline it is, there will be others to replace it. I agree multiple high-quality deals in your pipeline can be the answer but what I often also see is too many deals in pipelines which are poorly developed and become stale. The common focus on having 3 or 5 times pipeline volume as a metric often drives the wrong activity. (As managers, we need to be careful what we inspect/ expect).
If we look at the available prospecting time versus the required activity levels to advance those deals, most sellers in this situation have too many deals in their pipeline versus the amount of time they have to develop those.
Prospecting versus Nurturing.
If you’re operating at the very front of your pipeline and you’re trying to generate some interest and intent from prospects we know it’s going to take 7 – 12 touches across a certain time frame (say a 60day block). I calculate it takes about 16mins per single opportunity per week to prospect across multi-channels. PROSPECTING!
If the deal is engaged and it’s a matter of waiting for the prospect’s ‘buying window’ to open. For example, a contract renewal, a new need to develop, the existing supplier needs to stumble or even the sales process is long and tedious, think enterprise sales. Then we could be said to be in the NURTURING stage and this takes around 4mins per week, per opportunity. These times exclude sales meetings, obviously.
If you’re one of the many salespeople who need to manage their time across both creating new business and servicing your existing clients, you need to calculate the time you have available for both prospecting and nurturing. Then take that available time and allocate that time per opportunity. If you don’t have time to work a lead into a prospect don’t start. Leave it sitting ‘on the shelf’ until you have the capacity.
Consistently good, beats occasionally great in sales.
This is true for deal progression. Reaching out once or twice and giving up on a prospect is a sure way to be unsuccessful. (Occasionally great) We know that we need to map-out a multi-touch strategy to get a strong conversation started, (Consistently good)
Having 100 leads who are pursued through just 2 touches is much less valuable than having 25 leads who have a clear allocation of 8 deliberate touches. Those 25 leads are much more likely to generate a conversation and move through to conversion than those 100 leads. In this scenario, we still have 75 lovely leads left to pursue at a later stage.
As an example, if you have 13 prospects at the front of the pipe and 12 further along, this can take 4hrs and 18mins per week to stay on top of. (258mins using the numbers above). Most Sales Leaders/ Account Managers/ Executives would be surprised that it can take this long to work so few deals. If you were to times this by 4 to cater for 100 leads, this means you’d be spending more than 50% of your total work time working these leads (Plus you still have to add in sales meetings).
When we need to measure pipeline volume, I suggest we deliberately allocate sub-sectors inside your pipeline by size. Taking the 25 leads as an example, where appropriate, this pipeline could have 5 deals with a very high deal size, 5 with a high deal size, 5 with an average deal size, 5 with a lower value and finally 5 with the minimum value. The total of these leads volume hits the 3 – 5 x quota ratio. The exact ratio is dependent on your selling situation, but I think you get the idea.
The other reason smaller deals are important to include (Small fish are the sweetest fish) is that it helps us to maintain sales momentum and sales practice. We get to stay in ‘practice’ with all the process of moving sales through to completion with deals of all sizes. This way we are less likely to ‘mess up’ when we get to those larger deals. (Again, being consistently good, rather than occasionally great).
Soley managing the volume of a salesperson’s pipeline is not always the best approach. If we have too strong a focus on driving these volume numbers we risk sellers, either consciously or unconsciously, loading the number of deals to meet those metrics whether they be real deals or not, or whether they actually have the time to develop those deals or not. Both scenarios are less than ideal. This is how many sellers, who are responsible for both new business and existing accounts, can have too many deals in their pipe.
As well as being a sales trainer to Australia’s corporate sector. Mark is the #1 ranked Linkedin Social Seller in Australia. Contact Mark via Inmail message or [email protected] for a discussion around sales growth, coaching, social media, golf, cycling, AFL and sales effectiveness.