Where Do Your Lost Sales Go?
In my coaching sessions with clients, two related trends come up frequently. The first is the surprising fact that few salespeople ever find out what happens to people who do not buy from them. The second is an exaggerated belief in how loyal customers are, and a belief that potential customers will call back at a later date. When a salesperson stops trying to close a deal today because they believe they will get it in the future, it ends up costing untold amounts in lost sales.
To convince you of the point I want to make, I am going to ask four questions that have nothing to do with your business:
- Who is healthier: a married man or a single man?
- How much does it cost to print a $5 bill?
- How many people are bitten by other humans in New York City (NYC) each year?
The respective answers to these burning questions are:
- Married—the average married man lives 10 years longer than a single man;
- The cost to print a $5 bill is four cents; and
- In NYC, 1,600 people a year report being bitten by other humans.
It’s Not Always What You Think
The reason I ask these questions is to show that statistics are surprisingly different than what we might guess. Unless you actually measure things such as what happens to people who do not end up buying from you, you may guess wrong and make a serious mistake in sales and management.
In order to get more sales and profits, you need to know the actual—not guessed—answers to at least the following:
- How many demos are performed each week?
- What percentage of sales appointments actually have a full demo performed?
- What is the percentage of sales appointments in which the savings offered by our equipment is actually calculated by the customer?
These statistics are important to know; however, it is also important to know what happens to the people who do not end up buying from you. For instance:
- How many end up buying from a competitor instead?
- How many buy from a big-box store?
- How many do not buy anything?
- How many buy from another dealer within your same brand of equipment?
- What was their reasoning for not buying from you?
This information is important to the decisions you will make about the brand you carry, your sales staff, prices and market approach; all of which are worth investing in to get accurate answers.
It may be worthwhile to have a person at your company assigned to finding these answers. They could call everyone who does not end up buying from you and ask them for their reasoning. A free bag of salt could even be offered to obtain this information.
The employee obtaining this market intelligence should not be a salesperson because salespeople may not want certain statistics to be revealed.
In addition to calling, you could send follow-up mailings after three, six or 12 months to find out if these lost customers are happy with the decision they made.
Large companies invest plenty of resources in this kind of market research, but you can get this critical information for very little money with just a few phone calls and postcards.
Stop the Guessing Game
It is impossible to guess these statistics without actually obtaining information. You may feel that you know the answer, but are you really correct? Are your prices too high? Maybe they are actually too low. Do you really lose many sales to big-box stores? Which competitors are taking business away from you and why?
The answers and actions that will increase sales and profits are there for the asking. Make an effort to inexpensively collect these statistics, analyze the results without prejudice and make the changes needed to dramatically increase your control over your company as well as your sales and profits.