Ask any sales expert about the sales cycle, and they’ll testify to its importance. To succeed in sales, experts say, you must master the critical stages of the cycle — and they’re all critical. But what are these stages? Fifty experts might give you 50 different answers, but here’s a seven-step cycle that covers all the important stuff.
Prospect for Leads
To sell customers, you first must find customers. That means prospecting. Prospecting means doing things like:
- Cold calling
- Cold emailing
- Attending trade shows
- Buying lists of warm leads
Each method has pros and cons. Targeted advertising, for instance, can be very effective. It can also be very expensive. Cold calling costs nothing, but it’s not for everyone. It takes a lot of "no"s to get to each "yes." But if you have thick skin and perseverance, cold calling can bear fruit. It might take trying several methods to hit on the best one for you. That’s okay. The important thing is to keep prospecting, keep talking to people, keep looking for customers.
Consider the successful Canadian company TD Bank. One of its lines of businesses is mortgages. To sell home loans, its loan officers must find borrowers. To do this, the bank advertises a lot, and that helps. But their loan officers also take other initiatives, including forming relationships with real estate agents and joining networking groups, which are forms of prospecting.
Once you’ve prospected and found leads, you need to get those leads in the door. You’re not trying to sell at this point. You’re setting the stage so you can eventually sell.
To set appointments, you might make more phone calls. Maybe you have to call 100 leads to set five appointments. But that’s five more than you had before you started calling.
You prospected and found a lead, set an appointment, and they showed up. Now it’s time to qualify the prospect by making sure this person is a legitimate buyer. The idea is to determine if the prospect is in need of your services and able to buy. The prospect might not think they need your services. As a salesperson or business owner, it is your job to uncover that need, if it indeed exists, and bring it to light.
Qualifying also keeps you from wasting time on prospects who can’t buy. Think about TD Bank again. The loan officer first needs to determine if the prospect even qualifies for a mortgage. If the prospect has no job and no credit history, the loan officer’s time is best spent moving to the next prospect.
Make the Presentation
Once you’ve qualified the prospect, it’s showtime. Every stage of the sales process is critical, but your presentation is a make or break moment. You must impress the prospect here if you want to close the sale. That means doing several things right. Number one, be relaxed and be confident.
Two, and this is crucial, you must understand the borrower’s needs and their "pain points," addressing your presentation to solving those needs.
Lastly, remember you’re selling yourself as much as your product or service. Appearance and comportment matter, as does trust. Your relationship with the prospect matters more than any stat sheet or product specs.
If a TD Bank loan officer earns a borrower’s trust, the borrower probably signs with them even if the bank down the street is offering an eighth of a point lower.
You’ve finished your presentation. You feel like you nailed it. What happens now? The prospect whips out their checkbook and frantically writes out a check for your full asking price, right? It does happen. More often, though, you still have some work to do to close the sale.
Chances are, the prospect has objections, or at least a few questions. Don’t be discouraged. Objections mean the prospect was paying attention and signal at least some degree of interest. Otherwise, the prospect would simply thank you for your time and leave.
Your job is to respond to the prospect’s objections, systematically knocking them out one by one. You do this by keeping in mind their pain and their need. As you address each objection, bring it back around to how you can solve their problems.
Close the Sale
As Alec Baldwin famously said in Glengarry Glen Ross, you should always be closing. Every step of the sales cycle is part of your close. This step, though, is the actual close, the "hard close." This is where you ask for the business. Look across the table, tell the prospect you want their business, then ask for it. It’s shocking how many salespeople can’t bring themselves to do this. And they lose many sales because of it. To close sales consistently, you must ask for the sale.
Ask for Referrals
Want a shortcut to get you through sales cycle steps one through three in future sales? Ask the person you just sold for referrals. More often than not, they’ll happily give them to you.
When you call these referrals, you already have an in, and you often know they’re legitimate buyers, based on what your customer told you. This lets you fast-forward the prospecting, appointment setting, and qualifying stages.
Mastering the sales cycle is crucial, even if experts can’t agree on what the sales cycle is. They can agree on one thing, though: If you talk to a lot of prospects, set a lot of appointments, give lots of presentations, and meet the prospects’ needs in those presentations, you are going to succeed.