50% Of Sales Forecasts Are Undermined By Missing Information
There is critical information missing on as many as 5 out of 10 of deals in your pipeline. That alarming finding is based on seller’s own assessments of approximately 11,000 opportunities (10,549 to be exact) managed in the last quarter. That means as much as 50% of sales forecasts could be called into question by gaps in the information upon which they are based.
Sellers are not getting all the information that they need. They are being asked to prepare accurate forecasts and close deals while at the same time key information is being withheld. In this insight we will examine the types of information sellers are being denied and how it can be accessed.
The Seller’s Right To Know
Imagine there was a freedom of information act for sellers. One that required that buyers disclose all information. Information that would enable the seller to make an accurate assessment of the likelihood of winning the deal and its timing. That includes hidden motivations, behind the scene politics, as well as the ‘ins and outs’ of internal buying processes and procedures. It is a fanciful notion.
The salesperson has spent many months working on a deal – applying considerable energy and skill to advance the deal to within sight of the purchase order. But all that progress, all the hard work, could be at risk. That is because of missing information and an exposure to unforeseen events on the buyer side.
As a salesperson you have a right to know HOW the decision will be made, WHY they will chose one supplier over another and WHO exactly will be involved in shaping or making the decision. Indeed, that is the minimum you need to know to do your job. But according to salespeople we surveyed that is not happening for as many as 5 times out of 10 opportunities in their pipeline (or 53% of the time).
What Information Is Missing?
We asked salespeople (B2B salespeople) who are involved in up to 43,000 deals a year about the level of information they had on the deals in their pipeline. We wanted to know if they had 3 essential types of information in particular. So we asked them, based on the deals in their pipeline in the last quarter, how often the following statements were true:
‘We have a full knowledge of the buyer’s buying process…’
The answer was 5 out of 10 deals sellers have full knowledge of the buying process (or to be more precise 54% of the time). So, in every second opportunity sellers are being denied the following information:
- How the decision will be made; the steps of the buying process, information needs, documentation required and review points
- The specific requirements of getting the purchase sanctioned internally
- The stage that the purchase decision is presently at’.
‘We have the information to help the buyer to build a compelling business argument / case for our solution…’
That is also only true in every second opportunity, with sellers being denied the following information in as many as 5 out of 10 deals (or 53% to be exact):
- The essentials of the buyer’s business case/rationale for the purchase
- The key metrics of interest to the buyer to sell our solution
- Information required to calculate/present a payback to the buyer.
‘We know all the decision makers and can engage at the most senior levels with all those on the buying team…’
When it comes to the WHO of the sale – the buying team – sellers have answers to more of their questions than in any other area. Sellers indicated they had visibility of all those who shape & make the buying decision in as many as 7 out of 10 deals. That includes the drivers and motivations across the cross-functional buying team. This figure supports the traditional focus on the relationship aspect of the sale.
The Information Deficit
Who would have thought that the information deficit facing sellers was so great? There is vital information being kept from salespeople in respect of every second deal in their pipeline. Again, the results of our research is summarized in the visual below:
This missing information has the potential to invalidate the forecast as to the likelihood and timing of the deal, or perhaps even put winning the deal at risk. After all a 60% probability with only 50% visibility, is really much closer to 30% probability.
With this reality, it is surprising that salespeople are as successful as they are. For example, imagine an insurance company being asked to provide insurance with only half of the policy documentation filled out, or a mechanic being asked to fix a car, but only getting to see its back end. Imagine how B2B sellers could increase their chances of success if they had all the information that they need.
Are You Waiting To Be Told?
So why aren’t sellers getting all the information that they need? There is certain information that unless you ask you won’t be told. The problem is that you have to know the right questions to ask and you need to know how to interpret the answers.
Meanwhile buyers will legitimately say that there are some secrets that should be kept from sellers – is there some information that sellers should not have? So, what haven’t they told you? For example:
- They are talking to another two suppliers
- The project will need to go out to competitive tender
- The manager (despite an impressive sounding job title) does not have the authority to sign off on the purchase
- Procurement will be involved in the negotiation process
- The buying process is likely to take up to 6 months and demand a lot of the seller’s time
- A strategy of supplier consolidation is being implemented.
Even if information is readily forthcoming the seller needs to exercise caution. We all have experience or buyers telling us that the deal is about to close and that we are in pole position, only to get a surprise. It can be dangerous to accept on face value the information given from a customer, or prospect. The seller needs to probe for a better understanding.
Interestingly however some buyers tell us they are surprised that sellers don’t ask for more information about how they are going to buy.
More Information Means Fewer Surprises
While it is not possible to have 100% visibility, some sellers have access to more information than others and that gives them an advantage in winning the deal. It also helps to cut down on the number of shocks and surprises, such as in these examples:
- ‘The deal was progressing perfectly – all the right signals were being given. Then all of a sudden the decision was made to go an alternative route by a member of the senior management we had never even met. It is clear that we were talking to the wrong level.’
- ‘We spent a lot of time helping them to define the requirements and to spec out a solution. What happened next? They took all that and went out to competitive tender.’
- ‘Things were moving along well then suddenly the decision was put on hold by a change in strategy at the corporate level. It becomes clear that nothing was going to happen until an organization-wide review of IT strategy was complete.’
- ‘The manager had led us to believe he had the authority to do the deal, but then all of a sudden procurement showed up. All the progress made was lost, it was right back to square one.’
These are clear examples of ‘what you don’t know can harm you’ and as our figures show they are a risk in up to half of all deals.
Salespeople shouldn’t have to work in the dark
Salespeople shouldn’t have to work in the dark. Starting with the publication of our first book back in 2010 (The B2B Sales Revolution) we have been mounting a campaign to ensure that B2B sellers have more information regarding how buying decision are made. It has involved sharing real world examples of buying decisions that sellers would not otherwise get to see.
On the principle that ‘it is better to light a candle than to curse the darkness’we developed a checklist – you can use it to identify what you are not being told by the buyer and to pinpoint information gaps that could stop you winning the sale. Click here to download the Ultimate_Sales_Opportunity_Factfind.