Use a Sales Methodology to Increase Sales Win Rates by Double Digits
- A sales methodology shifts your selling strategy from what you sell to how you sell.
- It provides the methods or directives to advance prospects within each step of the sales process. For example, it defines the investigative questions to qualify a lead, the path to align buyer pain with solution benefits, the strategy to create an effective win plan, the negotiation methods to preserve revenue, the incentives to get the deal closed and many other tactics to win competitive deals.
- Research published in the Sales Excellence Report shows that sellers with optimized sales methodologies achieve an 11% higher sales win rate than those with informal methods.
- Selling success is further maximized when an optimized methodology is integrated with a structured selling process and CRM technology. These three components create the sales trifecta and increase win rates 6% above methodologies alone.
A sales methodology is a prescriptive but dynamic framework of selling strategies, tactics and responses that aid the buyer in completing their purchase decision, systemically and predictably advance the sales cycle, and maximize the sellers win rate.
Your methodology changes the focus from what you sell to how you sell. It defines the methods and actions that most influence sales outcomes. It positions and promotes your most powerful capabilities in producing customer value, including your competitive advantages, unique value proposition (UVP) and core competencies.
To achieve repeatable and predictable success, the framework must promote specific principals, methods, techniques and best practices that:
- Show how to solve buyer problems with customer insights, perspectives and points of view (POV)
- Show how to navigate the customers' buy cycle and lead to a predictable outcome
- Promote the most influential engagement and positioning at the right time
- Deliver the right action, content or response to the right buyer role at the right time
- Identify roles and responsibilities for team selling environments
- Seamlessly integrate the sales methodology and sales process
- Use technology to achieve automation, reporting and scale
- Convert customer and sales cycle data to insights to support guided selling and deliver contextual next-best-action recommendations
- Use consistent terminology and measurement; normally a unique taxonomy of terms
- Apply metrics to measure progress and quickly identify variances or red flags that need resolution
- Use closed loop reporting to deliver real-time alerts, predictive analytics and coaching opportunities
- Use a knowledgebase to store post-sale results and analysis so lessons learned can be delivered to comparable future sale opportunities
In short, the sale methodology must guide a repeatable set of actions that engage buyers and maximize sales success. Finding the optimal process and making it repeatable is an iterative effort.
Most sophisticated sellers use a commercial methodology such as the Challenger Sale, Miller Heiman, Revenue Storm, RSVP, Solution Selling, SPIN selling or Target Account Selling (TAS). These branded methods provide an overarching strategy, execution tactics and instruction for first-time adopters. While the good news is that there are dozens of options, the challenge becomes how to select the right sales methodology.
It's a challenge that must be accepted by revenue leaders seeking sustained revenue growth.
Enterprise selling is a team sport. For teams to communicate effectively and follow best practices, they must use a shared methodology. For sales managers to level-up sales team performance, they must apply a common framework. For leaders to scale revenues, they must promote continuous improvement to sales force performance.
Without methodology, sellers are without strategic plays and haphazard in delivering the most influential persuasion. They are unclear in their messaging and inconsistent in their selling. They become marginalized. It looks a lot like watching a foreign language film without subtitles.
No effort of this magnitude should be initiated before calculating the measurable benefits and payback.
Research performed for the Sales Excellence Report queried eight factors to learn how selling methodologies impact several important performance metrics. The data demonstrated that participants with Formal and Optimized methodologies achieved higher average sale amounts and faster sales cycles. But the single most impactful result to revenue generation was increased conversions. The below bar chart shows how win rates vary pursuant to the sales methodology maturity model.
The sales win rate is calculated as the percentage of forecasted sale opportunities that are won. Opportunities lost to competitors, lost to no decision or pushed out of forecast are considered losses.
The breakthrough point, where a salesforce outperforms peers, occurs when it advances from an Informal to Formal methodology. This is the first stage where sales wins exceed losses.
The shift from Ad Hoc to Informal is often a move from experimentation to a semi-structured or loosely structured method. The shift from Informal to Formal brings more supporting infrastructure such as proper training, CRM integration, manager coaching and frequent measurement.
The final maturity level of Optimized is characterized by active executive sponsorship, incentives management, enriched process integration, deep CRM integration, onboarding training, periodic refresher training, automated daily coaching, critical mass adoption and continuous process improvement. At this level, it is part of the organizations culture and engrained into the operating fabric.
The two factors that most correlated with sale methodology to achieve the highest win rates were sales process maturity and CRM integration.
Additional third-party sales methodology research shares supporting results. According to authors Michael Nick and Bob Kantin in their book, Why Johnny Can't Sell, sales reps that use a formal selling method are up to 40% more successful than those who do not.
Integration with CRM Software
CRM software is the technology that integrates customer data with process execution to aid sellers with guided-selling capabilities. This can include contextual suggestions, next-best-action recommendations, variance notifications and customer alerts.
CRM software is used to bring process automation, information reporting and scale to the methodology.
Most methodologies will link prescribed actions to CRM software work streams such as lead qualification, account planning, opportunity management, activity (call, meeting, task) records, manager coaching and forecasting. Many methodologies will append the CRM application with proprietary objects, such as Account Plans, buyer personas, customer insights, buyer role-based hierarchies, win plans, relationship heat maps, call plans and performance dashboards.
An IDC study, published in IDC’s Best Practices in Sales Methodologies report, analyzed the impact to quota achievement when CRM or Sales Force Automation (SFA) software was integrated to the selling methodology.
If found that 49% of sales reps made quota when the selling methodology was not integrated to the SFA software. However, that figure jumped to 68% quota achievement when integrated. Sales quota achievement grew further when the CRM system supported built-in coaching capabilities.
The bottom line is that trying to manage your selling method separate from your CRM system divides strategy from execution and incurs significant manual effort to achieve information reporting.
So, How do You Increase Win Rates by Double Digits?
When a selling methodology advances beyond the informal maturity level, seamlessly integrates with a defined sales process, and leverages CRM technology for automation and scale, the salesforce increases win rates by double digits. This three-way alignment creates the perfect storm.
Revenue performance is too important to leave to chance. Left alone, there will be as many types of sales process execution as there are salespeople.
Most selling methodologies are informal, inconsistent and deliver unpredictable results. When sellers are left without a defined and repeatable method, they revert to best guesses and random acts. This in turn creates protracted sales cycles and more losses.
On the flip side, successful salesforces don't leave sellers to figure out the most effective execution on their own. They orchestrate sales cycle execution pursuant to a predictable process, apply a proven selling methodology to increase effectiveness, and use technology to bring automation, measurability and real-time variance reporting.