“It’s not the employer who pays the wages. Employers only handle the money. It’s the customer who pays wages.” – Henry Ford
This quote resonates with every business leader. They understand that there is no business without a customer. They value their customers.
But have you sat back and thought about the value of a lost customer?
Here are some startling numbers to get you thinking:
- Acquiring a customer is 5 to 25 times more expensive than retaining an existing one.
- Long-term customers can yield ten times more business than the value of their first purchase.
- The value of a lost customer changes throughout the life cycle. The loss of an early adopter (someone with a genuine pain point) costs the firm much more than the loss of a later adopter (someone looking for deals).
It’s no longer enough to just hire an experienced sales team. To stop being a company that’s just surviving and turn into one that thrives regardless of competition, you must strengthen sales in an analytic manner.
Here are 5 steps you should double down on.
- Define Your Sales Process
Your sales process should focus on customer pain points and obstacles which prevent sales over the product’s benefits and features.
A clear process serves as a guide for your sales team to engage with customers at each step. It also enables sales managers to track the current engagement stage with a prospect and intervene if needed.
Document your process in your sales CRM. Make auditing this process an important Key Performance Indicator (KPI) for your sales managers. A well-defined and followed sales process alone has the potential to increase sales by up to 18 percent.
Not using a sales CRM yet? Connect with us for a free demo to see how a sales software can increase your business.
- Target the Right Prospects
A large chunk of the sales team’s time gets spent wasted in engaging unqualified leads.
They either get assigned such leads, or spend a lot of time chasing them. The result is that their sales pipeline gets clogged with incorrect leads and they cannot pursue qualified leads.
A common reason for this confusion is the lack of knowledge about the right prospect. As a business leader, ending this confusion is one of your key roles.
Profile your top customers and define your prospects to match their description. Ensure that this definition is understood (and accepted) across the company. Sales managers should store these details in your sales CRM and track whether leads being fed match this definition.
Here’s an added advantage of a CRM: It lets you nurture unqualified leads instead of discarding them. You can create a separate queue and engage these leads using a sales funnel. Lead nurturing increases sales opportunities by up to 20 percent in form of direct purchases or referrals, or both.
- The Five Follow-Up Rule
Do you know why 80 percent sales go to just eight percent salespeople?
Different studies in different markets at different times consistently revealed one thing: that 80 percent non-routine sales occur AFTER five follow ups. Further statistics reveal that 92 percent salespeople give up after four “no’s”, and just eight percent ask for the order a fifth time.
How many times does you sales team follow up with relevant leads?
Only two percent sales occur in the first meeting. To increase your sales numbers, managers must commit to tracking sales pipelines and status of follow ups with their frontlines. (This is where a documented sales process proves useful.)
- Meet Customers Consistently
Repeat customers are the best thing your business can ask for.
They bring in more revenue (up to ten times more than first purchase), provide references, and save you plenty of resources in marketing. Yet, such customers often get neglected by sales people in the quest for new ones.
Leaders must spend less time on unproductive emails and meetings, and more time identifying these customers based on sales reports and meeting them. This benefits your company in three ways:
It builds strong relations and reduce customer churn
It enables leaders to refine business processes and sales pitches to deliver what customers need
It shortens your sales cycle.
Repeat customers yield return on investment that can turn your company profitable faster. Research by Frederick Reichheld shows that increasing customer retention rate by five percent increases profit by 25 to 95 percent!
Need help with identifying how you can increase business with existing customers? Connect with us for a free, no-obligations meeting.
- Coach Your Sales Team
Effective coaching is more than just telling salespeople to “be go getters” or “getting [their] butts out of office.” It’s involves reviewing the sales pipeline with the team and planning steps for each stage.
Reports from the sales CRM and insights from customers prove invaluable here. Analyze this data to empower your sales team to follow up with customers more efficiently and effectively.
Sales is not about forcing your product on customers who don’t want it. Nor is it about waiting for customers to tell you what they want to buy. (That’s aggregation, not sales.)
Sales is about getting the right product to the right customer at the right time. When this occurs, trust increases and price becomes a less important factor. (Admit it, you have loyal customers who never haggle over price.)
Shift the focus from your company to your customers. Listen to your frontlines and gauge what your customers really want. Then build systems and processes to deliver these requirements seamlessly.
When you make your customer the focus of your actions, revenue and profit will flow in as byproducts. And no matter how saturated the market, your company will continue growing at a sustained pace.
How have you improved your sales processes? We would love to hear in the comments section from you. (If you have questions about improving your sales process, you can post a comment and we’ll respond to it.)