A macro view of customer indecision

All of us continue to try to make sense of the economy and plan for the year ahead. It's clear customer indecision is very top of mind for senior leaders. More deals end in "no decision" today than perhaps ever before and that number seems to grow by the minute.

One of the reasons our team at DCM Insights values our partnership with Winning by Design is they take a very research-driven and scientific approach. Just within the last few months Jacco van der Kooij has posted several whitepapers (here is one example, on the relationship between discounts and win rates) and the entire WbD team adds key insights and new angles via their own LinkedIn feeds.?

Many of you may have seen Jacco’s year-end piece, “The Sweet Spot in the Eye of the Storm: A Clarion Call to Recurring Revenue Leaders.” He does a masterful job of root-causing the SaaS struggles of 2022 while challenging us to think hard about how to grow in 2023. If any part of your business relies on recurring revenue I’d strongly encourage you to read the full article.

You’ll see mention of #JOLTEffect in several parts, starting on page 29. But as we read through the piece there were a number of additional observations that tied back to findings in our study and are applicable even beyond the SaaS industry. We’re sharing our thoughts here for the first time in hopes these are useful for all of you.

Observation 1 - Indecision is amplified by tight budgets

We wrote in the book about how indecisive buyers fear messing up (FOMU) more than they do missing out (FOMO). Tight budgets—and certainly the layoffs that may precede or follow tough budget decisions—can heighten and intensify indecision. Fewer dollars often means more scrutiny and eyes on whatever money is spent, raising the perceived risk buyers might feel about being blamed for decisions gone wrong. And with the threat of layoffs hanging in the air one can understand how indecisive buyers may become even more hesitant, your 10% discount be damned. All of this adds pressure for sellers to help buyers prioritize scarce resources, and Jacco points to the impact this may have on how sales teams will need to engage buyers in 2023, on page 20:

In 2023, successful SaaS GTM teams will position and sell based on priority, not budget. This means asking “Why now?” rather than “Why do you need this product?” or “Why us?”

This resonated with us, as we saw so many examples in our study of buyers with full intent to purchase still gripped by indecision. Decisions that felt like a slam dunk stalled out despite full agreement on need and clear evidence that the supplier had cleared the selection hurdle. For that highly indecisive buyer, the winning approach is not about re-convincing them on need; rather, it’s about reducing their fear of messing up enough such that they act now rather than tomorrow.

Observation 2 - Sellers must qualify opportunities on the ability to decide

Judging the level of indecision is critical to understanding the right playbook for engaging a highly indecisive buyer, addressing their specific version of FOMU. But it is also a relatively selfish activity, in that the seller must justify their own timespend. Time is too valuable for a seller to spin their wheels endlessly on opportunities with no hope to close because the buyer will never make a decision.

Jacco makes a similar point on deal qualification, approached from a different angle. He makes the counterintuitive observation that in many settings, the real risk has shifted from buyer to seller. This is particularly acute in SaaS, where growth is realized over time. But the point remains, from page 21:

GTM teams must be trained on identifying more of the right customers (based on potential impact) early on, and fewer of the wrong customers. Quality over quantity.

We couldn’t agree more. It’s not enough to qualify business based on the ability to buy. Our self-guided course curriculum dives deeper into how JOLT Effect sellers qualify opportunities on the ability to decide.

Observation 3 - First things first: fight those FOMO instincts

In our experience, real behavior change can only happen if the individual knows both what to stop doing as well as what to start doing. Too often we jump straight to the "start" part of the argument and forget that humans fight instincts and learned behavior. It’s far too easy to fall back into old habits particularly when the skill involves counter-instinctual activities.?

With respect to JOLT Effect, we expect many of your team members will struggle to let go of their instinct to keep running the FOMO playbook in those “cold feet” moments. But Jacco makes a really good point about how change is rolled out in organizations, on page 31:

Stopping Is Not as Easy as it Sounds

Most of us love to start new things, especially if we do not get the results we had hoped for. We launch another campaign, hire another person, or buy a new domain. Each of these initiatives requires more resources and more energy. We keep starting new things, we keep opening new tabs in our browser. But we rarely close them.?

This is because, for most people, the hardest thing to do is to stop. We do not easily give up on a campaign, fire a person we hired, or abandon an approach we carefully picked. We hate admitting we made a bad choice and we hope things will change. If something is not working, we consider it a failure; we are unable to see it as a successful outcome. We need to learn how to “Stop It.”

His point relates more to a leader or organization’s reticence to abandon a given approach. But can just as easily apply to an individual seller. Our advice for leaders out there looking to reduce indecision is to fight the FOMO urge: re-litigating the status quo argument can seriously backfire when customers are instead wrestling with indecision.

Observation 4 - Small improvements can make a big difference

Chapter 11 of The JOLT Effect details how sales organizations can build a more JOLT-capable team through hiring, training, and development. Readers will recall that we didn’t invent JOLT behaviors out of thin air. Instead, we observed high-performing sellers across millions of interactions and many different settings. Which is to say, there are people on your team now who are JOLT Effect sellers.

However, as we examine JOLT sellers, relative performance differs by behavior. For example, one sales rep may be world-class at limiting the exploration but struggle a bit more with taking risk off the table. Variation exists at the individual level. That means that all team members—low, average, and even high-performers—can improve at reducing customer indecision by leaning harder and more often in certain directions.

Jacco makes a similar observation about marginal improvement within SaaS organizations, on page 32:

Bring the team together, do it now. Use your SKO/RKO to make this a Clarion Call. Time is of the Essence.

Remember that SaaS operates on marginal gains. That means everything helps, and that means that every person has a role to play. Success in 2023 is based on everyone working together, as a team.

Translated through the JOLT Effect lens: there are things your teams can be doing tomorrow to reduce customer indecision. It’s true, some of the skills will feel more advanced and will take some time to get better. But other skills can be put into practice right away. Running the FOMU playbook is, at least in part, also about marginal gains and everyone around the organization has a role to play.

Observation 5 - Simple seller hygiene matters

Indecisive buyers often engage in analysis paralysis, worried they haven’t done enough homework and feeling the need to become experts themselves before making an informed purchase decision. This is even more likely to happen when buyers don’t trust that the salesperson has their best interest in mind, as they hide skeletons in their closet or oversell capabilities that aren’t yet ready for primetime.?

We write in the book about several skills sellers can deploy to Limit the Exploration. In particular, “Owning the flow of information” is a skill JOLT Effect sellers use to demonstrate expertise and earn buyer trust. One of the keys to improving here is about how sellers prep for and conduct interactions. On page 21, Jacco similarly points to meeting hygiene, but for different reasons, relating to the need for SaaS sellers to attain marginal gains via modest improvement on basic tasks:

The combination of these three factors represents a system highly sensitive to marginal gain — a system so sensitive we may call it volatile. This fundamental understanding of marginal gains sets top performers apart. There are many practices where marginal gains in the most basic of tasks can make a big impact, yet are frequently unrecognized:?

• Consistent messaging from first touch throughout the entire journey.
• Starting/ending meetings on time, with an agreed next step as a result.
• Following up diligently on agreed action items.
• Sending monthly impact reports to customers.
• Use of uniform language within the company.
• Great hiring and onboarding process.?

At first, each of these actions may seem isolated. But the Recurring Revenue savant knows they are all connected into a coherent system that depends on and amplifies each element. As presented in Principle #6, a Recurring Revenue system is susceptible to small changes, especially if these changes are repeated over and over again.

It’s another good reminder of the power of simple tasks such as how meetings are orchestrated and diligence in follow-up between meetings, both of which help demonstrate the seller has their ship in order and is looking out on behalf of the buyer.

If you'd like to learn more about The JOLT Effect, visit www.jolteffect.com. For more details on how to access more JOLT Effect + WbD solutions, insert your details here.