Improving the Sales Experience with Win-Loss Analysis

Transcript

Braydon Anderson:                                                

Welcome to this session of WinLossWeek, the world's largest online event dedicated to win-loss analysis. This event is hosted by Clozd, and we'd like to thank Challenger for their contribution to making this event a success. For this presentation, we're joined by Spencer Wixom from Challenger. Spencer is the senior vice president of marketing and business development for Challenger. He's been a part of the Challenger journey since its inception in 2008, researching and developing the concept, and implementing it in organizations large and small around the world. Prior to joining Challenger, Spencer worked in investment banking and real estate, and he lives with his wife and three kids in Dallas, Texas. Thanks so much for being with us today, Spencer.

Spencer Wixom:                                        

It's my pleasure, really excited, Braden.

Braydon Anderson:                                                

Awesome. The title of this session is Improving the Sales Experience Through Win-Loss, and with that, I'll actually just turn it over to you, Spencer.

Spencer Wixom:                                        

Great, thanks Braden, and hello everybody, it's an incredible honor to be a part of WinLossWeek, and to be able to share some ideas with you. I'm very excited about this, because we at Challenger have been doing a lot of research recently, both with sellers and with buyers, to really understand what this sales experience is like post-COVID, and that's where I really want to get started in talking about win-loss, is getting a good understanding of what's going on right now.

So first of all, what's interesting is when we studied buyers, we found procurement is back, they're back in a major way post-COVID. Fact, if you start on the left-hand side of this slide, [inaudible] major steps that procurement's taking. Over 50% of organizations are using procurement to reprioritize their spend across all categories, and almost 40% are putting in place purchasing freezes for anything they deem as non-essential. So you can tell that many times, procurement is taking an active role in reprioritizing spend, and evaluating whether this is a deal they want to do or not.

Now let's look on the right-hand side of the slide. 30% of companies have procurement involved in all purchases, and where they're not involved in all purchases, the average trigger for procurement to be involved is just as little as $5,000. Now, 54%, over half of purchases, are requiring prior central approval, and 38% of all new purchases have involved some kind of an RFP or formal competitive submission.

What we're seeing here is much more scrutiny in the deals that are happening, combined with a real downward pressure on budgetary spend, and when you have increased scrutiny coupled with downward pressure on budgetary spend, you get objections, real objections, and these are objections that our sellers are facing today. They're getting additional questions, they're getting additional requests, they're having to deal with more difficult concerns from buyers as part of that buying journey.

So dealing with objections, real objections, is more of a part of what sellers are doing today, and the question we asked in our research of buyers, how are sellers rising to the occasion? Are they supporting buyers in the way buyers need to be supported? And sadly, the answer is not really. When we ask buyers how sellers are doing in helping them through these difficult buying journeys that they have post-COVID, the answer from buyers is not great.

In fact, if you look at the most important skills that sellers need to bring to an interaction with buyers, and you look at what buyers are saying about sellers, seller capability is down, on average, 40% in the minds of buyers. A seller's ability to demonstrate unique insight, down 52% in the eyes of buyers. A seller's ability to help that buyer come to a decision, down 34%. Understand and address different stakeholder needs in that buyer, down 41%.

It's not that sellers' skills have atrophied post-COVID, I don't want you to get that perception. It's that the bar that buyers have set for sellers is so much higher. And I'd challenge you, and we'll talk about this a little bit more in my presentation a bit later, but I would challenge you to think about, how are we evaluating the experience that our sellers are bringing to the these buyers? Are we evaluating whether or not our sellers are meeting the bar, this raised bar, that buyers have set? It's important to consider, and we're going to talk about it more deeply as part of this presentation.

But also, I want to think about this three-dimensionally. It's not just about what we're doing with buyers, but also when we do it with buyers. "Alea iacta," Latin phrase from Julius Caesar as he led his soldiers across the Rubicon to fight Pompeii and the Optimates. We don't know it in Latin, most of us, but we do know it in English, "The die has been cast." Sometimes, the outcome is decided far earlier than we would expect. Let's think about the buyer's journey, and let's think about when these buyers may cast the die.

A typical buyer's journey tends to have two components to it. It has a section on the left-hand side of the slide here, which is all about the buyer on their own, learning, understanding their needs, and building consensus among their buying group. Now, if we as sellers don't do anything to proactively intervene in that early part of the customer's buying journey, then we react to that established demand when that buyer is evaluating options, and as they evaluate options and various vendors, they'll ultimately, supposedly, come to a decision.

And I think a lot of us think about win-loss analysis as that ultimate decision that the buyer makes at the end of the buying journey. We think the decision is here, right at the very end. But what our research has told us more recently is almost 40% of these purchase attempts, these journeys that these buying groups go on, they end in no decision whatsoever. So clearly, things had happened earlier in the process to bring about the events to where this buying group ultimately disbanded.

So the question we ask ourselves, is the important moment in that buying journey here, at the end, or maybe here, where if we haven't proactively gotten in early and influenced emerging demand, we react to established demand 57% of the way through that buyer's journey? Or maybe the die are cast here at 37% of the way through that buying journey, when group conflict peaks among that buying group, where they can't decide what it is they're trying to accomplish, or even the problem that they're trying to solve.

It could even happen here, right at the beginning of that buying journey, where we know from our research that almost 90% of problems are identified without supplier input. Perhaps that buying group just got off on the wrong foot initially, they identified on their own the wrong problem to solve. The point being here is we can't take for granted that the actions at the very end of that buying journey are the actions that matter most. We have to look across the entire [inaudible] to really understand not only what happened, but when did it happen? And all of this is what we call part of the sales experience, and in our win-loss analysis, we want to be evaluating, again, what happens in the sales experience, and when it happens in the sales experience.

Now, why is the sales experience so important for us to evaluate in our win-loss analysis? Because our research here at Challenger tells us that if we want loyalty from our customers, if we want them to buy from us, and then buy more from us, we need to look at the sales experience. If we just look at company and brand impact as part of our win-loss, we're only getting 20% of the answer, because that only represents 20% of that customer loyalty equation. If we look at product and service delivery, again, that's only roughly 20% of the equation. And if we look at that buyer's perception of the value-to-price ratio, we only get less than 10% of that equation, and if you add up these three, you are sub-50% of the story. Again, understanding the sales experience, understanding what happens, not only what, but when it happens, [inaudible] interaction with that buyer throughout that journey, gives you the picture of what you need to know.

So let's dive into it, let's understand how we measure a sales experience in win-loss, and I'd like to go deeper on just three components of that experience, because we believe these are the three components that really matter. First of all, it's bringing the right message to the customer. Did we bring them the right message? Secondly, it's did our sellers have the skills to deliver that message effectively to the customer? And third, were they talking to the right buyers in the first place? Were they talking to the right people in that customer's organization who could get something done? So let's take a moment and explore each of these three, and what I hope to do is give you some tactical ideas for ways you can measure the right message, the right skills, and the right buyers, so you understand how the sales experience can affect your wins and your losses.

Starting with measuring the message. What's the kind of message we want to measure for the customer? Now, the short and easy answer there might be, we want to understand if we gave them thought leadership, right? Did we give them facts and data and trends, did we give them information that was useful in that decision-making journey? But here's where I challenge you to think differently. The world is awash in thought leadership. Everybody is providing customers thought leadership, and if you're not, you're probably deficient in some way in your marketing and sales efforts. But where I challenge you is to go beyond thought leadership, and to think about, are we giving customers insight, and more specifically, commercial insight?

And why is that important? Well, it's important because of a study that we did with buyers a few years ago, where we asked them what kind of a message or information would drive them to do something different, would motivate them to change their mind? And if you look at this chart here, you'll see statistically insignificant factors and statistically significant factors.

Start with the insignificant factors on the right-hand side. "A smart and expert perspective," sounds a lot like thought leadership. "A message that is easy to understand," again, a lot like thought leadership. "Contains interesting facts or anecdotes," and "A message that is accessible or quick to find," [inaudible] definitions of thought leadership, and not statistically significant in driving a buyer to action.

We need to think about having something different in our messages, and measure something different in our messages, and there are two elements of that message that we specifically need to understand and measure. First, did that message teach them something new about their business? Did it uncover something they weren't thinking about? Did it reframe their thinking in some way? And secondly, did that message clearly and concisely give them a compelling reason to take action? Did it make them realize that the pain of same is greater than the pain of change? These are the two elements that are statistically significant in changing the minds of buyers.

So let me give you tactically a couple of win-loss questions that you could use. First of all, maybe ask your customers, "What new insight did we share that made you change your status quo thinking?" Or "What information most compelled you to take action?" These are questions you can ask as part of your win-loss to understand, are we bringing the right message?

Now let's talk about measuring the skills that our sellers take to these conversations. I mentioned earlier that buyers' perspective on the skills sellers bring to them has gone way down, 40% down post-COVID, so it's critically important for us to understand what are the most important skills for buyers, and what are the skills that would differentiate a seller from other sellers? And the easiest way for us to understand this is to look at the chart I have up here.

Now, there's two axes here that we're looking at. The vertical axis is the importance in the mind of the buyer of that particular skill, and the horizontal axis is the customer or buyer's rating of that skill. So when looking at this chart as it maps out a whole host of skills that sellers can bring to a conversation with buyers, is to look for those that are important to buyers, and also that not all sellers are good at delivering, because that will differentiate the seller the most in the mind of the buyer.

Now, what's interesting, and as I walk through this, you'll see if you're familiar with the Challenger skill model, you're familiar with our mantras of teach and tailor, and take control, and constructive tension, you'll see that all of those elements are reflected in this, but you'll also see very specific skills that are really important to emphasize with buyers in this environment, and to understand whether our sellers are demonstrating them or not.

So let's start up here at what are most important to buyers, and these are teaching skills, particularly demonstrating that unique insight, and helping that customer come to a decision. Also important are tailoring skills, working with that customer to understand and address the issues of stakeholders, and helping to build that support or that consensus across the organization.

Now, what's interesting over here is making it easy for that customer to make a purchase, or providing the right information at the right time, yes, they are somewhat important to customers, but they're also something that most sellers are doing pretty well today, so they're not going to necessarily differentiate you from others who are out there. My recommendation would be to really focus on those teach skills, particularly the unique insight, and some of those tailoring skills, particularly around building consensus among the buying group, and we'll talk a little bit about that here in a bit.

But finally, we have the skills around constructive tension. Now granted, these aren't very important to the buyer, but buyers typically aren't going to say, "The thing I want more in an interaction with a seller is a little bit more constructive tension." That said, it's very helpful in motivating that buyer to take action. You want to think about some skills like helping that buyer demonstrate the pain avoided, or providing examples, anecdotes and stories that help that pain come alive for the buyer.

So let's talk about how we can prioritize, in our win-loss analysis, an evaluation of some of these skills. Here are some questions to ask. "How well did the salesperson understand and address your issues?" That's a tailoring skill. "Did the salesperson build support for the idea across your organization?" Again, were they able to bring people together, build consensus? That as well is a tailoring skill.

And "Did the salesperson help you quantify, in a believable way, the pain of not taking action?" Again, we're building that constructive tension, we're [inaudible]. You take the commercial message that teaches them something new and motivates them to take action, and you couple that with skills that are effective at tailoring, building a buying group, and really demonstrating that case for change, and all of a sudden, you have a very powerful experience you're taking to your buyers.

So finally, let's talk about how we can measure the buyer who's involved in this decision-making progress, in this sales experience. Well historically, everybody would say, "We need to evaluate whether there was an advocate or not in this buying journey." But what's really interesting about advocates, and we went out a few years ago, and you can read about this in our Challenger customer book, to study advocates and really try to understand them.

What we found when we asked individuals, both sellers and buyers, to describe advocates, is a ton of different characteristics of those advocates. For example, it was an individual readily accessible and willing to talk. An individual who can provide information that's typically unavailable to other suppliers. They're good at influencing and convincing others, they always speak the truth, they deliver on their commitments, often more than asked. A bunch of great characteristics of that advocate, and sometimes we're tempted in our win-loss analysis to say, "Was there an advocate? Was there not an advocate?"

But here's the problem. Of 700 customers that we evaluated in our study, we only found one individual who met all these criteria. So if your evaluation in win-loss is whether there was this perfect advocate or not, you're never going to find that individual. Just like sellers, who have various different profiles and ways of going about selling, there are different customer profiles, or ways of going about buying.

And our study did a segmentation of those buyers, just like we did a study where we segmented sellers, and we found some very interesting things. We found a number of different profiles of buyers, excuse me, number one. And number two, we found that each of these different profiles were very different in their ability and their likelihood to drive organizational action, which means first of all, we need to know who we're looking for, and second of all, we need to partner with the right people to help get these [inaudible] accomplished, and these deals done.

Now, let me tell you about some of these profiles of buyers, because they're very interesting. Starting on the left and moving to the right here, you have a profile of the Go-Getter, that person just intensely interested in making change happen in the organization, and they have the credibility to do so. You have the individual who's the Teacher, bringing new ideas, sharing those ideas, trying to build consensus around good ideas. The Skeptic, now this is a very interesting profile, and one we may avoid when we first interact with them. Yes, they're challenging our ideas, yes, they're skeptical of our numbers, but if we can convert them over to our side, they can be a great advocate and promoter of our idea.

Now you have the Guide, that individual who will tell you other people in the organization to talk to, but he himself or herself doesn't necessarily have the credibility to get things done. The Friend, that person always willing to talk with you, but not necessarily willing to make something happen. The Climber, that individual most interested in his or her career advancement. And then of course, the Blocker, those individuals we always encounter, likely advocating for somebody else's solution.

[inaudible] different kinds of customer profiles we can interact with, the point being, there are some profiles much better at driving organizational action than others, and we call this group collectively Mobilizers. They are individuals who will understand our commercial insight, appreciate it, then turn and promote it and build consensus around it in the organization. We collectively have Talkers. Those are the individuals, as I said before, interested in having conversation with us, we think we're making progress in having conversation with them, but the buying journey stalls, and no decision happens. Then of course, we have the Blockers, individuals we need to understand and identify very early in the buying journey, and plan a strategy to work somehow around them.

The point being here is we need to find the Mobilizers and work actively with the Mobilizers. Let me give you a couple of questions you could use in your win-loss to do just that. First question, "Who from your company was involved in making this decision?" We want to understand what types of people, who really was instrumental in making the decision? "Of those involved, who shared the strongest perspective, and was most successful building consensus?" If we can identify that, we can know, were there Mobilizers present in this buying group, and how effectively were we working with them? And maybe ask directly that very question, "How effectively did the sales team engage the individuals who were successful in building consensus, who understood the insight that was brought, and were building a desire among the buying group to follow that path?"

So in summary, we've talked about a lot of things, but there are three elements of a sales experience that we can effectively measure in our win-loss. First of all, the right message, but remember, we're not measuring whether thought leadership was provided, we're measuring whether commercial insight was provided, and that commercial insight is based on teaching the customer something new and motivating that customer to take action.

We're looking for the right skills in that sales experience, but most importantly, we're looking for the skills that are most important to the buyer, and those skills that will differentiate us as a seller from other sellers who are out there, namely, delivering effectively that unique insight, tailoring that message effectively and building consensus in the buying group, motivating them to take action. And finally, an experience with the right buyers, but it's not just a perfect advocate or any buyer, we're looking for did we have Mobilizers in the buying group, did we identify them, and did we partner effectively with them to drive change?

I hope that I've given you some ideas and some ways to think about implementing the right message, the right skills, the right buyers, into your win-loss analysis. It's been a great pleasure presenting this to you. I'd love to have a connection with anybody who's interested. You can connect with Challenger at challengerinc.com/connect, you can also scan the QR code below. We'd love for you to follow us on LinkedIn, we've published a few books, love for you to pick them up and read them, and very excited about the win-loss work that you're doing now in 2020. All the best, everyone.

Braydon Anderson:                                              

Spencer, thank you so much, that research sounds awesome. That was so cool to see some of the insights. I think too often, I've had too many of those Friends as you mentioned in the sales cycle, and you got to find the right people, and I think that was one of the biggest takeaways I got from this session, so thank you so much for this, thank you everyone for attending WinLossWeek. Again, follow Challenger, they've got great content, as I'm sure many of you have already participated in, so again, thanks for being here, and we hope everyone has a great day.

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