By Steve W. Martin
Why does a salesperson lose a sale? To identify the factors that help close a sale, we surveyed more than 230 buyers. Here are our six main findings:
1. Some customers want to be challenged. Forty percent of study participants prefer a salesperson who listens, understands and then matches a solution to a specific problem; 30 percent prefer a salesperson whom they trust to take care of their long-term needs; and another 30 percent want a salesperson who challenges their perceptions and proposes a solution they may not have known about.
2. It’s really a committee of one. Whenever a purchase decision involves a team, one person tends to dominate, according to 90 percent of study participants. Moreover, this person prevails almost every time. Therefore, a salesperson doesn’t have to win over the entire selection committee, only the dominant individual.
3. Market leaders have an edge. In most industries, a single company controls the market. For salespeople who have to compete against these industry giants, life can be very intimidating indeed. However, buyers aren’t necessarily fixated on that market leader. The fashion and finance verticals had the highest propensity to select the top-of-the-line product, while manufacturing and health care had the lowest.
4. Some buyers are “price immune”. For “price conscious” buyers, price is the deciding factor. For “price sensitive” buyers, price isn’t as important as functionality and vendor capability. For “price immune” buyers, price becomes an issue only when the solution is far costlier than the alternatives. Engineering is seen as price immune; marketing and sales as price sensitive; and manufacturing, information technology (IT), human resources (HR) and accounting as price conscious.
5. It’s possible to cut through bureaucracy. The salesperson’s worst enemy today isn’t his rivals; it’s buyers’ indecision. Is it easier to close a sale in some departments? Sales, IT and engineering seem to have more internal clout to push through their projects as opposed to accounting, HR and marketing.
6. Charisma sells. Many salespeople behave as if buyers are rational. But many factors—some rational, some not—affect any given decision. Ultimately, it’s mastery of the intangible human element of the sales process that separates the winners from the losers.
Steve W. Martin teaches sales strategy at the University of Southern California Marshall School of Business.