Sales lesson #3! Stay in YOUR freaking lane!
Many of you have heard of the Pareto principle. This principle states that 80% of the output comes from 20% of the input. This means a majority of the sales you close will come from very few of the organizations you engage with. The goal here is to help you identify the characteristics of optimal companies to target so you don’t waste time chasing deals that won’t close.
It’s all about staying in your lane of traffic.
• Traffic Lane 1: Prospects who are too small
• Traffic Lane 2: Prospects who are too big
• Traffic Lane 3: Your Lane
• Traffic Lane 4: Prospects who are in the wrong vertical
What’s your lane? It’s determined by a set of criteria you can use to know whether or not a company is an ideal target to focus on. Don’t stress we have some tips here too.
One thing to be aware of is that most people think too broadly when it comes to this. They want to include everyone who might benefit from their product. It’s easy to do because if you’re like me your product can be used by almost anyone. This is a bad approach though and will lead to a lot of wasted effort and time. Companies outside of your ideal lane will still take a meeting, watch a sales preso, and even enter negotiations, but they will ultimately close at a far lower rate than your target buyers, which results in a ton of wasted effort.
For example, targeting a company with at least $20MM in annual revenue is probably not a very accurate description of your target market. Your product probably doesn’t provide the same degree of benefit to a $20MM coal mining operation as it does to a $20MM hospitality network.
Remember, on average only 20% of your sales effort is going to create 80% of your sales output! Don’t try to be all things to all companies. You can’t be everything to everyone. It waters you down!
Here’s a simple list of characteristics to help define your lane:
• Size: this could include locations, employees, and/or revenue.
• Geography: This is important if you’re on a team that divides territories or if your product is only sold in one region.
• Budget: Includes budget or current dollars being spent.
• News: This includes any changes or events that indicate a mandate or ability to purchase.
• Industry: Be as specific as is reasonable (Wireless Communications vs Communications Equipment).
• Related Technologies: Either technical requirement or buying signal.
If you don’t know all of the answers to these characteristics, that’s okay. Look at your current customers and find qualities that the best accounts share, then use those as your guideline. If you don’t have customers yet, make an educated guess regarding who you want. Just be prepared to adjust as you learn.
One mistake to avoid is a negative aspect of desperation. The more desperate you are to hit your quota, the more likely you are to target the wrong prospects. In fact, you shouldn’t even call them prospects. They’re more like victims. But this effort is ultimately wasted (remember the Pareto principle?). If you stay in your lane, the results will come.
Sales is a science! It takes years of study and practice to be great. For many companies it’s too painful and lengthy of a process to take on. If that’s the case doesn’t forget to make the smartest business decision available and outsource your vital sales functions to experts. The time saved and ROI could make all the difference in your world. For more information on how outsourcing can help you grow your business via sales CLICK HERE.