What better time to think about improving your company's sales-force effectiveness than now?
With business growth more unpredictable than ever given the current economic climate, a win/loss analysis may be just the way to help you gain a quick advantage over the competition. Surprisingly, however, most companies don't leverage win/loss.
Studies have found that growing companies win roughly 50%-60% of the deals they bid on. If you include customers who take no action, that number drops to 20%.
Do you really know why you lost the recent deal or why some customers keep coming back? Customers have the answers, but they rarely provide them in an unfiltered manner to your sales and service teams.
What Are the Benefits of a Win/Loss Analysis?
We are all busy. We process megabytes of data daily. Why do we need another piece of analysis?
First, win/loss is more relevant to your company and customers than any piece of market research—because it's specific to you.
Second, what you learn can transform your business if acted on effectively.
In short: Win/loss provides the potential for a very large payback. Some customer feedback will be the "low-hanging fruit," such as tweaking your marketing message, improving your sales process, or reaching out to customers in different ways.
Other findings will drive longer-term investment in product, services, and new market segments. The output will likely change your investment priorities and enable you to close more deals.
How Do I Conduct a Win/Loss Analysis?
Win/loss requires an ability to ask your customers some tough questions and to listen with an open mind. Not everyone can do that.
Think through the key issues you want to understand. For example, how do your customers make decisions about buying your products or services? What are their most important purchase criteria? How do they rate your company's product, and how do they rate your competitors' products?
You need to get to the bottom of those issues before you can address how your message or strategy needs to change.
Key Success Factors
Every win/loss effort should include the following four key success factors:
- Have an objective party handle the interviews and analysis. The interviewer can be from within your company or outsourced; just ensure it's not someone who is customer-facing so as to avoid potential biases or an interest in protecting the status quo. You need your customers to speak with you candidly.
- Collect data via a one-to-one dialogue, not via a survey. Surveys (especially online surveys) tend to be short and binary (yes, no; good, bad; etc.). To get to the "gray areas" of unclear customer needs, you need to dig deeper and go beyond the obvious. Challenge the customer's initial answers to discover the real behavioral drivers. Surveys are not designed to do that.
- The analysis should be quantitative, actionable, and measurable. To be defensible, output should be based on a large sample of quantitative, in addition to qualitative, data. The quantitative ties directly to investment decisions and calculating return on investment.
The analysis may not be straightforward, but the data should lend itself to short-term and long-term recommendations that will ultimately lead to higher close ratios and improved profitability.
- Conduct win/loss analysis regularly. Companies should track progress annually (in some cases, quarterly) along the agreed-upon action items and goals. By making win/loss an integral part of your business, you have the ability to harness the customers' insights and greatly improve your company's sales effectiveness.
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Win/loss is a time-tested way to help you understand customer needs effectively. It gives you the ability to leapfrog over the competition by keeping a pulse on industry trends, the competition, and needed enhancements to the sales process, products, and services.
The opportunity to improve your sales and marketing success rates sits right at your doorstep. Why not take advantage of its benefits?