Improve your prospects
Identify and target your ideal client for effective and efficient prospecting
Salespeople have a natural inclination to pursue all leads with equal vigor. And let’s face it. Sales managers and CRMs often encourage this behavior. While this leads to a lot of sales activity, it doesn’t lead to a commensurate increase in closed deals. To the contrary, money and energy are often wasted on deals that will never close, leaving you short on resources when you go to win prospects with real potential.
The more effective approach to prospecting is to create a profile of your perfect customer, identify prospects that most closely fit that profile and pursue them exclusively. While it may take time to get used to the idea of turning your back on a lead, if you commit to this approach, your improved close rate will convince you that this is the most effective and lucrative approach to prospecting. In fact, it’s possible to attain close rates of 90% when you only pursue those prospects that look like your ideal client.
Identifying your perfect client
You probably already have a sense of what your perfect client looks like, but to improve your prospecting, you should create a written description. This is critical to the process. If you don’t have a written description, you are more likely to “fudge” your evaluation of a prospect or simply overlook important criteria. For this approach to work, you have to be disciplined in your evaluation. And having a written set of criteria by which to evaluate a prospect will enforce that discipline.
Attributes of your ideal customer can be identified through an evaluation of your current customers. Determine which ones derive the most value from your product or service and why.
The idea behind this approach is simple: You are far more likely to win the business of companies for which your company is a strong fit. This requires looking beyond the product or service that you sell to other issues that are critical to the long-term success of the relationship. For example, there should be a good fit relative to culture. This includes issues such as how much service you provide and how you provide it. It’s important that both you and your client have shared expectations in regard to post-sale service.
It’s also important to long-term success that your product or service solves a keenly felt business need. Perhaps this sounds obvious, but the keenly felt need is often not the need identified by the prospect in initial discussions. This is because prospects often focus on day-to-day operational needs – not out of malicious intent but rather because they are typically operations folks. In all likelihood, they don’t know the underlying keenly felt business need. This is why one of the attributes of the ideal customer is the ability to engage with executive management so you can confirm the presence of critical business needs that your product or service addresses.
These and other attributes of your ideal customer can be identified through an evaluation of your current customers. Determine which ones derive the most value from your product or service and why. Your assessment should include questions such as:
- What types of companies have made purchases since the economic downturn began?
- What critical business issues did your product or service solve?
- Who within the organization had the authority to make the purchase decision even without a budget— i.e., who was Power?
- Was a capital appropriation approval process required and, if so, at what funding level?
- What was required relative to return on investment?
- What was the total-cost-of-ownership?
- What role did technology play in the decision?
- What level of service was required to ensure success?
By answering these questions, you will be able to develop a profile of your ideal customer. This will be the model against which all future prospects will be measured (your Zebra).
Evaluating a prospect
Once you’ve developed your profile, you can score prospects on each attribute to determine how closely they resemble your perfect customer. A prospect can be scored within five minutes using this technique. Use a scale of 0-4 where four is a perfect score. When you’re done, you’ll know how closely a prospect matches your perfect customer based on the type of company or organization it is, the critical business issues that your product solves and whether:
- power is identified and engaged in process
- the funding and process for financial and functional approval are in place
- power agrees with ROI projections
- you have a technology advantage
- the prospect recognizes your value and is willing to pay for the level of service being proposed
Add the scores for each attribute to obtain the prospect’s total score. A total of less than 16 indicates that spending time with this customer is a waste of resources. A score of 17-22 indicates that you should proceed with caution. And a score of 23 or above says pursue this account with everything you have.
As you move through the sales cycle with a prospect, you will uncover more information about the account. Be sure to adjust scores accordingly to ensure that they continue to reflect the prospect’s value to you. If you consistently use this scoring system and focus on those prospects that rank well, you will be rewarded with close rates that make you the envy of your colleagues.
"This article was originally published in SOLD magazine, a monthly digital sales magazine for sales professionals."