Most sales managers look forward to producing a sales forecast with the same level of enthusiasm reserved for a trip to the dentist.
Sales forecasting is typically a torturous process that involves interrogating sales reps about the status of their deals and analyzing self-reported sales activities that managers rightly suspect of bias.
Not only is the process of creating a sales forecast usually unpleasant for all involved, it also tends to produce inaccurate results based on wishful thinking instead of hard data. Moreover, a Forrester Research study found that only 6% of sales leaders say they are "very confident" in their company's sales activity data, and a whopping 66% don't even use automated data to develop their forecasts.
That's a huge problem. Sales managers and company executives make critical business decisions based on sales forecasts. Those decisions regarding how to allocate resources, what new products to develop, and whether to expand marketing campaigns often hinge on sales forecasts that are more akin to "hopecasts" than fact-based estimates.
A Better Way
One of the major drawbacks of the traditional forecasting method is that it provides almost no insight into what buyers are thinking.
Sales managers query individual sales reps on how close the buyer is to making a purchase, but unlike some sales cycles—such as B2C purchasing patterns captured on e-commerce sites—the traditional sales forecast doesn't factor in buyer behavior. It substitutes it with a second-hand and self-serving account of it.
Because of modern data collection and analytic capabilities, today there is a better way to build a sales forecast. Companies that use a digital business interaction platform can capture buyer behavior data and factor in more detailed reporting collected at the interaction point to develop a forecast that is less wishful thinking and more driven by hard data.
With a well-designed business interaction platform, sales leaders can view tracking information on product presentations, gaining visibility into whether prospects opened the presentation, which solution sections potential customers focused on the most while viewing the presentation, and whether they shared it with colleagues. That all provides insight into buyer engagement, much as e-commerce tracking can accurately predict online visitor intent.
Rethinking the Hopecasting Approach Improves Sales
When sales organizations commit to monitoring business interaction and capturing data by using a digital platform, they get unprecedented visibility into the sales funnel by analyzing buyer behavior instead of relying on second-hand accounts of buyer intent.
That new mobile-first, digital approach that enables marketing and sales teams to pick up on customer signals that accurately pinpoint where the prospect is in the sales journey.
That not only makes for more accurate sales forecasts, it also gives sales reps a more active role in the sales process and sales managers greater insight into team performance and support needs.
For example, instead of relying on an individual salesperson's opinion about where the customer is on an important deal, a sales manager can use the platform to view buyer actions, looking for the telltale burst of activity that typically precedes a purchasing decision.
Managers can use these insights to provide support on must-close transactions, allocating resources on the basis of actual data rather than guesswork. Sales reps can use the data from an engagement platform to view customer status from anywhere on any device, anticipate customer needs, and provide the right follow-up pitch to transform a looker into a buyer, tailoring the message to the customer's current placement within the sales funnel.
A More Modern Strategy for Next-Generation Customers
When sales organizations use a business interaction platform, customers benefit, too.
The buying cycle has changed with the advent of search engines, Big Data, and social media. Customers today do their homework before contacting a company for information about their products. Customers typically have access to basic product information and have researched competitor products, so sale reps need to do more than just wait to take an order.
Customer expectations have also changed—today's customers anticipate personalized offers, which they routinely receive as consumers and increasingly expect from B2B sales contacts. A one-size-fits-all messaging strategy doesn't resonate with modern customers, but a message clearly crafted with their unique concerns in mind will.
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Sales leaders can significantly improve forecasting, a task many approach with dread, when they move beyond wishful thinking and embrace a data-driven strategy that centers on customer behavior and results rather than self-reported activities.
Though moving beyond traditional forecasting might be the most obvious benefit from using a business interaction platform, remember that it's not the most important one. When sales leaders use a more modern strategy that puts customer behavior front and center, they not only build a better sales forecast, they create a superior sales organization and strengthen customer relationships.
Take the first step (it's free).
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