There have been a lot of great posts recently about losing Deals (check out Pipedrive’s great post about that or Mark Suster’s gem here). What piques my interest is how we can use our data to track these losses, and ultimately harness this information to minimize loss over time. In a nutshell: Know why you are losing so you can do something about it.
The first step to knowing is tracking:
Document a lost reason. Ideally, from a pre-defined list of reasons configured in your CRM. When you have specific reasons that your team has defined as valid to your sales process, you can clearly and consistently track your losses and more easily single-out exceptional cases.
Don’t skip the analysis:
Review these lost reasons for trends. This is most effective if you have that pre-defined list of reasons so that you can sort, filter, graph, pivot. The more consistent the data, the better you can analyze it.
Let’s put it in action.
If I have a salesman on my team who is documenting a lost reason of “Pricing out of range” consistently while in the “In negotiation” stage of our pipeline, I can use this information to provide him with training on our negotiation tactics or our discount options. Alternatively, if this is a consistent lost reason among our entire team, perhaps this is an opportunity to discuss our company’s pricing or lead generation strategy at an executive level. At the end of the day, I want to reduce the quantity of Deals lost to this reason. Analyzing the data is the key to success here.
Think about the ways in which your company or your team could improve if you knew which lost reasons are used most frequently at each of your Pipeline stages. Or, which Deal owners are consistently losing Deals for the same reason.
Integrate this knowledge into your metrics
When looking at your won-lost ratios, for example, there may be lost Deals that you wish to filter out due to irrelevant or invalid lost reasons. Did your lead go bankrupt midway through the Deal process? Capture this in the lost reason, and then filter it out before presenting your team’s performance metrics.
It’s a simple practice, but tracking and understanding the reasons for your lost Deals can significantly improve the sales process. After all, who here doesn’t want to start losing less and winning more?