Founder Question: Shortening Sales Cycles
“Has anyone started their startup with a product that has long sales cycle enterprise deals. I’m wondering what tricks you have learned to shorten sales cycles in the beginning to accelerate the time to close and get feedback. All ideas, blogs, experiences, etc.. welcome!”
A Village Global founder wrote in with this question in the last couple of weeks.
And I thought I'd address it because it's a meaty topic I deal with a lot in my client work. And also because writing about it could not only help our founder above, but also support many other startup operators.
In the following paragraphs, we'll look at plenty of reasons why deals may be lagging to close. In the interest of time and space, we'll give you a glimpse at some of these causes and offer possible solutions to overcome them. But the list is far from exhaustive. With that disclaimer now out there, let's dive in.
A reason why deals might be dragging on is that you haven't properly qualified for timing/urgency. You may be letting deals through that have no business closing in the short or medium term. If that's the case, you can try hard to close them, but there's virtually no chance they'd cross the goal line. One simple qualification question might have gotten you a response that saves you a ton of time and energy. “You know what, Diana…now that you ask…we're probably not going to be ready to make a purchase until a year from now. We're just slammed with other priorities. Interested in knowing how best to qualify for timing/urgency? Last week's installment does a good job of outlining that.
Driving urgency for your prospects can shorten your sales cycles substantially. If you ask seasoned salespeople, they'll tell you it's one of the most difficult things to execute in sales. Hard doesn't equate to impossible, however. Perhaps the most potent way of instilling urgency is by framing prospects not doing business with you as burning bushels of cash. Yes, we're playing the opportunity cost game. And – pardon the crude metaphor – prospects realizing that they're pissing a lot of money away by not buying your product tends to bias them towards taking action. “Peter…I get this is a tough call…but we've done math…and I'm happy to go over it with you. We've calculated that every week you forgo implementing our product, you're actually losing a tad over $25K in cost savings.” The reason this kind of framing is powerful is simple. You explicitly show folks they're losing money by sitting with the status quo. It ends up lighting a fire under their derrières.
A major cause for deals stalling or taking forever in enterprise sales is a lack of clarity as to what needs to happen to get a deal done. And the product fully implemented for your customer. In my book, the sales process doesn't end with a John Hancock on a contract. It concludes when your prospect starts deriving value from your product or service. In order to know who to sell to and what steps must be taken, the salesperson needs to obtain a detailed buyer journey from every customer. Without it, you run the risk of being ambushed by unknown stakeholders, deals getting completely shot down, or having opportunities stuck in no-man's land because you didn't know what to do next. ‘Now, how does one garner this buyer journey you keep harping on?’, you might be thinking.
Glad you asked. The question I like to ask prospects is, “How do you guys typically buy a solution like ours?”
We're trying to get the steps, timeframes, and stakeholders we'll need to meet with to get a deal done and our product implemented with our customer.
A prospect might respond, “Well…our VP Marketing must green-light this first. And we meet with her on Tuesdays at 2 pm. Then this would go to Finance. And our CFO is generally good about signing off on a deal like this, is a matter of 2 weeks or less. And then, if you guys were to send over sturdy boiler plate agreements, our legal team could get us to a place where we could sign in two to three weeks.”
“That's great. Can you take me past signature? What would it take to get us fully implemented? I'd love to know so we could marshal the right resources in-house to get you properly onboarded if and when we get there.”
This follow-up question is meant to get you to the end of your sales process.
“Our Head of Customer Success has 8 direct reports. She's usually good about getting her folks herded up quickly. I'm sure she could get them together for an onboarding call within 7 to 10 days.”
Now you're cooking. You've got an accurate map of the terrain you'll need to traverse to get the product purchased and into your customer's hands.
As you hear about the buyer journey, you'll want to take copious notes. Once you've got them all done, you'll repeat it back to your prospect, asking them, "Did I get this down right?" If you get a "Yes", that will mean two things. One: you'll get fewer bad surprises. As you will have left no stone unturned. Like potential decision makers that could come out of the woodwork. Two: you'll be able to keep your prospect honest. If they said it would "take 3 weeks to get through legal" and you're sitting in week 5, you'll reach back out and ask, "What's going on with legal? You had told me it would take 3 weeks...do you need anything else from me? How can I help?" You're keeping your prospect accountable. Holding their feet to the fire. And letting them know they're slipping on their initial timeline.
There's nothing like a scintillating product demo to get folks pumped about what you've been building. Strong enthusiasm helps your sales opportunities catch fire. And your sales cycles start shrinking. ‘Paul, what's one thing you can do in a product demo to make it more convincing?", you might ask. Take a page out of Robert Riefstahl's “Demonstrating To Win!” and ask yourself, "So What?" after each user flow you're demoing. This inquiry acts as a forcing function. You feel compelled to tie the feature or functionality you just showed back to value for the customer. Your demo moves away from being an exposition of your software to selling an outcome.
If you've ever talked to me about sales for any length of time, there's a great chance I've preached about selling next steps. It's more than just booking the next meeting or call — which is considered Sales 101. It's about ensuring the prospect knows why it's in their best interest to attend the next step. It needs to feel like “must-see TV”. Too much value resides in that next meeting for them to forgo it. Selling next steps is the connective tissue between steps in your sales process. It prevents deals from dropping off or stalling. And therefore can have a huge impact on shortening your sales cycles. If you want to learn more about its significance and the framework to employ to do it successfully, read this older entry from our blog.
It's undeniable that sales folks revere the ability to control the sale. It allows you to set at least some of the variables that will close more deals. One technique to control the sale is installing forcing functions to ensure things get done, like a contract getting executed, or the first subscription payment made. Without these constraints, you risk having prospects drag their feet when performing key tasks in the sales process. And that always lengthens your time to close. Getting in touch with your inner control freak is actually recommended if you want to get your deals closed promptly. More on that in a previous entry.
Imagine having just suffered from a broken arm. There's a great chance you'd jump at taking a painkiller if I offered you one. ‘Yes, please, Paul. Give me your strongest stuff. Advil or Tylenol probably won't do the trick. How about oxycodone or morphine?’ Now, imagine having a small rash on your arm. You could live with it and just scratch it whenever it flares up, without any outside help. Sales is about finding pain. Part of your job when you sell is uncovering your prospect's pain. Usually during discovery. The more acute the pain, the better. Just like a good detective – our older readers will remember Columbo – you should devise a line of questioning that will get your prospect to become completely aware of their suffering and confess it to you. Once you get them to verbalize their pain, you're in a good place as a salesperson. The only thing you now need to do is to map their pain to your product as their painkiller. Helping your prospect discover their pain and articulate it is more than half the battle. Your prospect's hair is now on fire, and they'll soon be lunging for your product as the remedy to their agony.
What do you notice in the above? A lot of potential items to install or fix. Right? Meaning there are a ton of things to examine and install. And most often, not enough time to do them all. That's where coaching can be hugely valuable. Not only do we aggressively move to understand your unique situation. But we quickly come up with tailored solutions for your extended sales cycles. Any reader of this post is welcome to book a 1-hour free sales consultation ($1,250 value) with me. You bring your thorniest sales/GTM issues, and I help you solve them. It gives you a chance to experience what sales coaching can do for your startup. And more than likely walk away with a ton of value. Just reply to this newsletter, or drop me a line at paul@gassee.com to schedule.