Sales Process is Overrated - Why we Must Focus More on Understanding the Customer Buying Journey

Sales Process is Overrated – Win & Loss Assessments Must Focus on the Buying Journey!

Understanding and following a well-defined and documented “Sales Process” has been a critical component of every professional sales organization for over 100 years. Before we dive into why your sales process does not matter in today’s buyer-centric world, and why the Customer’s Buying Process is in control.

Discover What is Happening in your Buyer(s) Buying Journey

This entire article is built upon a simple premise that instead of focusing primarily on your internal sales process (inside), the focus should convert to the external customer buying journey (outside). Simply stated, converting to an Outside-In orientation allows your sales team to “see behind the scenes” of your target Customer’s Buying Process. The results will include decreased deals lost to No Decision, compressed sales cycle time, and increased win rates against your competitors.

Before we take a detailed look into the role of win and loss assessments as a key ingredient to taking an Outside-In approach to Customer Acquisition, let’s take a quick trip down the Sales Process memory lane.

Sales Process History

In the 1920’s – 1950’s sales methodology became a staple of most professional sales organizations. Psychological selling promoted the idea that the best salespeople were those who understood how buyers think.  Relationship selling, such as Dale Carnegie’s How to Win Friends and Influence People, highlighted the importance of developing a personal relationship with the buyer and Barrier selling, which encouraged practitioners to trick the customer into saying yes.

In the 1950’s “formula” selling such as AIDA (Attention, Interest, Desire, Action) were the rage. In the ’60s complex sales processes were born when Xerox published, and then sold, Professional Selling Skills (PSS) which used a “Needs Satisfaction” approach.

Since the 1960’s we have seen a proliferation of new sales processes being introduced and popularized by sales training firms, research firms, sales consultants, and many others. How many of the following have you heard about, read the associated books and/or attended a sales training session(s):

• Sandler Selling System (1967)
• Miller-Heiman, Strategic Selling (1978)
• Solution Selling (1988)
• SPIN Selling (1988)
• Value Selling (1991)
• Customer Centric Selling (1993)
• RAIN Selling (2002)
• Baseline Selling (2005)
• Social Selling – Sales 2.0 (2006)
• Selling Through Curiosity (20xx)
• The Challenger Sale (2011)

Today’s Sales Process Investment and Associated Results Do Not Add Up

Having a well-defined, understood, and followed sales process is a key tenet of almost every mature and even aspiring B2B sales organization. Training a sales professional is the largest training expense that any organization makes. The Association for Talent Development (ATD) estimates that $20 Billion per year is spent on sales training, which equals $1,500 - $2,000 per sales professional.

How is that level of sales training impacting sales performance? Forbes reported that in 2018, 57% of salespeople missed quota. CSO Insights research suggests that 47% of sales professionals missed quota. 

Harvard Business Review conducted a similar survey specific to the technology industry and those surprising results are provided in the below chart:

Survey of 100 Vice President of Sales - Source: Harvard Business Review

In traditional B2B sales organizations, sales productivity models directly drive the creation of annual operating plans (P&L’s) and typically factor in that 75%-80% of sales professionals will meet quota. This has a dramatic impact on not only profitability but also on the reputation of the entire sales organization when sales modeling predicts revenue performance that is 20-30% greater than the latest industry research and trends indicate. Missing a revenue plan by 23% - 33% is not a career-enhancing performance.

Investing in additional sales process training, hiring new sales professionals, defining, deploying, and managing a new sales process is most likely throwing more money at a problem that is not well understood. The real problem, a changing more powerful buyer and buying process that is not factored into the sales process and does not reflect the buying journey of yesterday’s buyers.

Today’s Customer Buying Journey is Changing Everything in Customer Acquisition

While well-defined, well-executed sales processes provide more consistency and predictability into sales forecasts, the internet democratization of information access, along with several socio-economic -demographic changes, have fundamentally changed how B2C and B2B buyers buy. We need no further proof than to see what sales and marketing professionals experience every day, the associated changes in customer buying behavior and decreased customer acquisition efficacy we continue to experience.

The data on how the buying process has changed is everywhere ranging from:

• 67% of the buying journey is done digitally (Sirius Decisions)
• 57%- 90% of the buying process is completed before a sales resource is engaged (CEB, Google, Gartner, CSO Insights) 
• 44% of buyers identify specific solutions before reaching out to a sales resource (CSO Insights)

The number of people involved in the buying process continues to increase, regardless of which data point you subscribe to. Harvard Business Review reports the number of buyers has increased from 5.4 to 6.8 over the past two years. TOPO, an advisory services firm in the technology industry, reports that 8 – 22 people (yes, 22 in one case) can be involved in the buying process.  

Per a recent Gartner B2B Buyer Survey, only 17% of a Customer’s Buying Journey is spent speaking directly with the vendor's sales organization. This suggests only 5% of the buying journey time is spent with any single vendor to evaluate their solution Why, then, are we spending so much time and money on training our sales organization on how to primarily impact 5% of the buying journey, versus investing the majority of our time to understand and influence the other 95% of the buying journey?  

The Gartner B2B Buyer Survey also highlighted that 77% of buyers found their latest B2B purchase to be complex or difficult. The charts are included below:

                      1,100 B2B Buyers in 2019 - Source Gartner B2B Buyer Survey

Another key factor impacting the buying journey is the changing profile of the buyers. TrustRadius reports that over 45% of B2B technology buyers are 25 to 34 years old, making them the single largest demographic; followed by 30% in the 35 to 44-year-old age group. With software and technology being a larger part of every product, coupled with the changing nature of the workforce, it is only natural that new dynamics and buyer persona(s) are fundamentally changing how buyers buy. The question is – how have marketing and sales organizations adapted? Many are using techniques, processes, and assumptions that have been around for 20 - 50 years. 

Many companies are painfully aware of the changing buying journey dynamics over the last decade. Most marketing and sales technology vendors have provided their version of a “Simplified” Buying Journey that includes some element of the following six stages: 1) Awareness; 2) Interest; 3) Consideration; 4) Decision; 5) Purchase; 6) Re-purchase to help customers align the software functionality into the buying process.

Unfortunately, the majority of “Buying Journey” mapping initiatives are conducted around the vendor’s conference room table. The typical wide array of perspectives and insights are provided by marketing, sales, customer success, services, and product. During the mapping process, the vendor’s executives will weigh in and their perspectives carry more weight and ultimately drive the final “Buyer Journey” mapping deliverable. 

The result is more about what the vendor imagines, or hopes, the buyer is doing versus the reality of what really happens in the Customer’s Buying Journey.

More mature and enlightened companies will also engage existing customers who bought the product, but these discussions center more around the criteria (feature/function) for the purchase and the value (ROI) used to help justify the purchase. These companies are much more confident that they truly understand why buyers buy and will enhance their marketing materials, campaigns, and sales process that factor in these Buyer Journey datapoints.

Before you stop reading and start planning how you can champion a “Buyer Journey Mapping” project in your company, we have found from conducting over 500 Customer Buying Journey Mapping programs, which included over 2,000 Win/Loss assessments, that the majority of assumptions made by companies on their target customers’ buying journey were incomplete and often misleading due to information not being gathered directly from prospects who both purchased and did not purchase their solution. The most common missing element was the presence of a complete win and loss assessment process that included multiple buyer personas (s) at prospect accounts that were both won and lost. In fairness to those that try, it’s difficult for the vendor to truly get behind the scenes and understand the complexity of today’s buying journeys, especially for “lost deal” situations. To gain detailed insights into the customer’s decision-making process, and what impacted their buying journey, requires a level of expertise and experience that most companies do not possess internally.

Win and Loss Assessments Must Include these Datapoints:

How many times have you heard from sales that a loss came down to one of these four key reasons: 1) Price; 2) Product Functionality; 3) Other Vendor had a previous relationship; 4) Decision Postponed. In fact, across over 2,000 win/loss assessments, we have found a much more complete list of variables that impacted the buyer’s decision. Since research suggests that up to 50% of sales pursuits end up in “No Decision”, our assessments highlight additional reasons deals are lost or just quietly die.

Common No Purchase Decision Factors:

• No decision-making process
• No funding
• Sales process out of alignment with the buying process
• Missing information/knowledge
• Fear of the change that would be required by moving forward with a purchase decision
• No compelling reason to invest
• No reason to invest now
• Higher priorities set by company executives
• Unclear benefits
• Other implications associated with the purchase decision 
• No unique value offered
• The solution does not fit perceived needs
• Lack of organizational support
• Lack of executive support or sponsorship
• Conflicting priorities across department and/or departments
• Changing requirements

Win and Loss Assessments Insights – Some Examples:

Using a more robust and systemic win/loss assessment process often uncovers that business value and Return on Investment are not the key critical factors to making the purchase that so many vendor’s ROI models primarily focus on.  

As an example, one company was confident that their business value was so strong, that any potential buyer would be foolish not to invest. The Loss Assessment uncovered that their product did, indeed, show great ROI on paper, but in practice their existing back-office systems were not able to track the return of “refreshed” products into usable inventory, thus not resulting in savings, but resulted in increased costs due to the refreshed products remaining unused on the shelf as they did not show up as available inventory, while procurement continued to buy new products. The insights gained from the loss assessment was the catalyst for developing a new consulting service that included process modification and a partnership with an Inventory Management vendor that provided a more holistic solution.

Another example was a loss assessment that was conducted to understand why the win rate had decreased dramatically over the previous 12 - 24 months. The loss assessment identified a recurring theme that the perceived value of the required add-on “training and professional services” was a key factor working against the company. Training delivered as an on-site professional service was traditionally considered a unique value add specific to one vendor. That same service was now viewed as a commodity that multiple independent contractors could provide at a much lower cost and did not need to be purchased from the product vendor. The maturity of the market had reached a point where the bundled solution was only valued by about 25% of the potential buyers. Without the benefit of feedback from multiple loss assessments, the existing packaging and value-based sales process would have continued to result in reduced win rates.

The final example is a company that was the leading provider of a Digital Marketing Platform that led to multiple high six-figure and even seven-figure deals in the early stages of market evolution. 

What seemed like overnight, the competitors were winning more deals, and pricing leverage appeared to disappear for the perceived early market leader. An outside sales process vendor was brought in to analyze why the loss rates were increasing and the average price point was being reduced, but no win or loss assessments were done directly with buyers. After 18 months, two new sales executives, two new marketing executives, a new sales process resulting in reduced average contract value, reduced enterprise win rates, and sales turnover over 50%, an Outside-In Assessment was done with both existing customers and lost deals.  

The Loss Assessment identified that most existing customers were not aware of key features/functions that, if known about, would have been criteria for customers not to churn to a competitive solution. Besides, the market had matured to a point that basic enterprise-level functionality, which was once was considered as not required, had become a standard feature offered by most other vendors and viewed as a standard requirement by the majority of buyers. This requirement was not understood or historically prioritized by the product team who had helped create the market five years earlier. After adding the key reporting features required, and actively promoting this across marketing and sales, increased win rates climbed back to industry-standard levels.

Win and Loss Assessments – A Holistic approach is required to Understand the Whole Buying Journey

Win and Loss Assessments are critical to identifying the multiple variables that result in not only higher win rates, but serve multiple stakeholders across the company including marketing, product management, services, and customer support.

Win and Loss Assessments are typically more effective when conducted by an experienced win/loss assessment resource outside of the vendor. 

Customers, and more importantly companies that chose not to become customers, are often hesitant to share information directly with the non-selected vendor that makes the vendor’s product or sales resources look unfavorable. Also, many internally developed Win/Loss assessments do not include all the requisite information to truly understand the real “Buying Journey”. If you do decide to conduct your own Win/Loss Assessments, here are some critical areas to include:

• What information and sources did they use to determine vendors to be evaluated?
• When did they first engage with the sales organization?
• Determine what solution, if any, the customer selected
• Understand why the customer went with that decision – including a “no purchase” decision
• Why didn’t the customer select the proposed solution?
• Comparative analysis to what they did select
• When, in the process, did their decision that lead towards the selected vendor begin to materialize?
• Who was involved and what roles did they play in the decision process?
• When did each role get involved in the decision process?
• What were the overall concerns and anxieties across the buying journey, and if they changed, across the buying journey?
• What were the most important value drivers the customer was looking for, and if they changed, during the buying journey?

Win and Loss Assessments alone are extremely valuable, but only when conducted as part of a broader Buyer Journey mapping to move to an “Outside-In” customer acquisition process will the optimal benefits be realized. Going to the next step of moving from a “Sales Process” to a “Customer Buying Journey” being documented and instrumented in every component of the Marketing and Sales Technology stack is critical to mapping your Sales Process to the Customer Buying Journey.  

Today’s Customer Buying Journey is Complex and ever-changing. Consider Beginning to Understand by Conducting Win and Loss Assessments on a Regular Cadence

Information, metrics, and industry statistics are coming at us faster than ever before, and from an increasing number of sources all with different angles. 

To convert your Customer Acquisition Process to an “Outside-In” model that starts and ends with the potential Customer’s Buying Process, Win and Loss Assessments are critical to moving from an assumptive Inside-Out orientation. 

If everyone across all market-facing functions including Marketing, Product Management, Product Marketing, Sales, and Customer Success cannot quickly highlight the most important steps in the Customer Buying Journey, it may be time to start conducting at least 3 - 5 Win/Loss Assessments with the actual buyers using an external, objective resource quarterly. It may be time to move to a “Customer Buying Journey” centric process and re-allocate some of that $20B we spend on sales training every year to have the buyer inform us of WHY and HOW they did or did not buy!!!