|Home - Industry Article - Jun 05 Issue
Why Did We Lose the Big Deal? 5 Questions Every CEO Should Ask
By Steve Martin, Author,
When we’re closing business life’s great! When we’re on the losing side of a deal, it is easy to feel like
Our entire world has fallen apart. Losing is a subject that most salespeople and sales managers don’t like to talk about. Therefore, the CEO plays an important role in understanding why we lost the big deal because unless we truly understand why we lose, we will most assuredly lose again.
While losing to competitors is painful, losing to the dreaded “no decision” is even worse. We spent all the time, effort, and resources on an account that couldn’t even make a decision. Whether losing to competitors or “no decision,” true analysis of the loss starts by asking five fundamental questions that are inherent to every software sale.
Question #1 – Did we sell to the bully with the juice?
Some people are natural-born leaders. They have an aura that can motivate and instill confidence. They command respect and people naturally follow their lead. That person is called the “bully who has the juice”. In every software deal, there is only one person who is the bully with the juice and the sole decision-maker. Being a bully is not necessarily a negative term, nor is it necessarily the highest-ranking person involved in an evaluation. Instead, the bully who has the juice is the person who single-handedly makes the selection and can override the product selection made by other decision makers.
People will argue that some purchases are truly made by a committee. While a committee does put more “fingerprints of accountability” on the product selection, behind every committee is a bully who has the juice and the committee’s decision will reflect this.
Obviously, if the bully with the juice is backing another vendor you’ve already lost. When there isn’t a bully with the juice in an account, you should be prepared for no decision to be made. Conversely, if a bully with the juice does exist but you aren’t able to identify the person, be prepared to lose the deal because you are in a position of extreme risk.
Question #2 –Did we sell logically or psychologically?
Unfortunately, we have been trained to think of customers and ourselves solely as rational decision makers who use logic and reason exclusively. However, every software purchase decision can be traced to one of four psychological roots.
When you sell solely based upon logic you are destined to lose since the logical reasons people give for buying products are only rationalizations that mentally enable them to justify the expenditure. The successful influencer is the one who appeals to the four psychological motivators.
- Survival. The will to survive is one of our strongest desires. We are wired to maintain our health physically, mentally, and emotionally. Buyers want to keep their jobs and for their companies to prosper.
- Pain Avoidance. When something is hurting you badly, the desire to eliminate the source of pain is all consuming. Nothing else really matters. Buyers want to solve their most painful problems immediately and completely.
- Self-preservation. We naturally seek the approval of others. While we want to be recognized for our unique talents, we still want to be part of a group. Buyers want to be respected and liked by their colleagues and peers.
- Self-gratification. Everyone’s got a selfish ego, and we’ll go to great lengths to purchase something that makes us feel better about ourselves and superior to others. Egos drive the business world and someone’s ego is the driving force behind the major projects and the grand initiatives that result in the purchase of your software. Buyers want to make their mark on the world.
Question #3 – Did we know the decision maker’s fantasy?
All software sales involve selling a fantasy. The fantasy is that somehow the software you are selling is going to make the customer’s life easier, save the customer money, or enable the customer to make more money. The feature set of your product validates the fantasy elements of your “story” and promotes the customer’s fantasy. During the sales cycle, your goal is to communicate how you can turn your customers’ fantasies into a reality, but only when your product is selected.
Evaluation team members also have a “personal” fantasy. Maybe they want to master new software to enrich their resumes. Maybe they want to earn bonuses for cutting costs or increasing revenue. Maybe they want to be perceived as heroes within the company or to spend more time at home and less at work. Everyone has a personal fantasy that is associated with the procurement of a product. Heavy Hitters (truly great salespeople) understand and align their strategy with personal fantasies. They don’t just recite product features, benefits, and specifications.