In a nutshell, Sales Cycle Management refers to the act of optimizing your sales cycle. In this guide, we’ll run you through the different stages of a sales cycle, and share several tips and best practices that you can use to improve your sales process.
A sales cycle is a process that your company undertakes when selling a product or service to a customer. Think of this as a series of steps that leads you up to a sale.
If you haven’t already done so, it’s important to identify the stages of your sales cycle, and come up with key metrics that you can use to measure your team’s performance at each stage.
Why is this so? First, having a well-defined sales cycle makes it easy for you to train new sales reps. You’ll be able to provide these reps with a structured roadmap, which lets them familiarize themselves with your process.
On top of that, having a better understanding of your sales cycle also empowers you to structure your team more effectively. Say you’ve analyzed your sales cycle, and you’ve realized there’s a bottleneck when it comes to following up with leads. Naturally, you’ll want to re-assign roles to your team to ensure that enough is being done at this step.
Last but not least, keeping track of your sales cycle also helps you to better evaluate your team’s performance. If the average length of your sales cycle is decreasing month-on-month, this means that your team is effectively closing their leads in a shorter period of time, which is great news. It’s also worthwhile to benchmark the length of your sales cycle against that of your competitors, so you can see how you’re stacking up.
As you might expect, sales cycles vary from company to company. The industry you’re in, the market share you have, the type of product you’re selling, and plenty of other factors play a part in affecting the stages of your sales cycle. That said, most sales cycles involve some or all of these seven steps:
The sales process begins when your sales development reps sit down and start prospecting for leads. In this step, they look at their ideal customer profiles, identify the potential clients they’d like to reach out to, and decide how to approach these folks.
Here’s a question that we get a lot: what’s the difference between sales prospecting and lead generation? Some marketers use these terms interchangeably, but there is a difference between the two activities. With lead generation, you’re merely collecting contact information from your leads; with sales prospecting, you’re actually reaching out to these leads and establishing that they’re interested in your product.
Once your leads start trickling in, it’s time to make contact with them. Before deciding how you want to reach out, you’ll have to assess your leads and determine which stage of the Buyer’s Journey they’re at.
Say your lead has given you their contact information in exchange for an ebook download. At this point in time, they’re only gathering more information about the solution to their problem, and they’re probably not ready to make a purchase yet. As such, you might want to reach out to your leads via email, and nurture them before you set up a phone or in-person meeting.
If your lead has filled up a form on your website and contacted you for a quote or a product demo? That’s a clear indication that they’re ready (or almost ready) to make a purchase. Bearing this in mind, it makes sense to give them a call right away.
If you are calling your leads, make sure you do it in a timely manner. Consider this: 75% of leads end up doing business with the first company that they hear from. And just for the record, getting back to your lead within 24 hours simply won’t cut it. To have the best chances of converting this lead into a paying customer, you should call them back within a single minute of getting their information.
What happens if you call your lead, and they don’t answer? According to statistics, it takes an average of 8 to 12 attempts to reach a lead on the phone - so keep trying, and don’t give up. While we know that the best times to contact leads are Wednesdays and Thursdays between 4 and 6 pm, try and switch your timings up as well. If your lead has their Wednesday afternoons dedicated to weekly strategy meetings, regardless of how many times you try, you won’t get through to them.
After you’ve made contact with your lead, the next step is to qualify them. Now, you might have already done some pre-qualifying earlier in the sales cycle. Perhaps there was a field on your form asking your lead how large their company is, or how much they do in annual revenue. If you’re certain that your lead is qualified and capable of making a purchase, then it’s okay to skip this step and move on to nurturing them.
If not, you’ll want to ask your lead a series of questions that helps you assess how well they fit into your typical buyer profile. Many companies will use the BANT methodology; this stands for Budget, Authority, Need, and Time. Appropriate questions to ask may include:
How large is your lead’s budget?
What is your lead’s job title? Do they have the authority to make a purchase, or are they simply conducting research on someone’s behalf?
What are your lead’s pain points and needs? Does your product address all these needs?
How urgently does your lead need your product?
Getting an idea of your lead’s budget is particularly important for companies whose products or services are priced at a premium. You wouldn’t want to spend three months nurturing your lead, only to realize that they don’t have the budget to engage your company.
Assuming that your lead isn’t ready to buy right away, this is where you start nurturing them and moving them down your funnel. Now, most marketers and business owners automatically associate lead nurturing with drip campaigns created via a CRM tool.
On top of putting your lead through email campaigns, for example, you can also retarget them with Google or Facebook ads. If your lead is active on social media, it’s also possible to nurture them using chatbots.
Once your lead starts looking at your pricing page or signing up for trials and demos, this demonstrates that they’re ready to make a purchase. At this point in time, go ahead and make a relevant, targeted offer to your lead.
Once you’ve made your offer, the ball is in your lead’s court. There’s a high chance that they’ll push back, and surface one or several objections to you. Your job is to handle these objections, and convince them that choosing your company is the best solution for them.
If your lead says that the price of your product is on the high side, do the math and tell them how much ROI your product will bring them (or how much costs it’ll save). If they’re worried about getting their team to adopt new technology, tell them about what your company can do in terms of set-up and training, and talk about your easy-to-use support channels. You get the idea.
After handling your lead’s objections, it’s now time to close the sale. Make sure you’ve prepared all the paperwork and forms, and go ahead and ask your lead a closing question. How aggressive your approach should be depends on the temperament of your lead. You should have a good read on this person by now; this helps you anticipate whether you’ll have more success with an aggressive approach, or vice versa.
What happens after you’ve successfully closed your lead? Sales development reps might be so relieved to get the sale that they end the meeting and leave as soon as possible, to avoid the possibility of their lead changing their mind. That said, you shouldn’t cut short your meeting abruptly - make sure you give your lead the chance to ask any follow-up questions that they may have and walk them through what are the next steps.
Right before you leave, do also give your lead your business card, and ask them to refer their friends to you if possible.
Regardless of whether your team is already hitting its revenue targets, or they still have a long way to go, they should continuously fine-tune their sales techniques and improve their sales cycle. Here are a few tips to keep in mind.
The average sales rep spends just 36% of their time selling, with the rest of their time being eaten up by low-value work such as administrative and service tasks.
If you want to improve your sales cycle, an easy way is to allow your reps to outsource their administrative tasks, so that they can focus on selling. A CRM system is designed to do this. It consolidates your customer data from multiple touch points—phone, email, chat, website, etc., and maintains records without any manual intervention.
We previously discussed the difficulty of making that first contact with a lead, but that’s only a small part of the puzzle. While successfully making contact is a victory, you’ll still have to work on following up with your lead; unfortunately, this can be a pretty long drawn out process.
Interestingly enough, while 80% of sales require five follow-ups before a deal is made, 44% of sales reps give up after just one follow up. Moral of the story? Your sales reps will have to develop thick hides and persevere with their follow-ups. Make use of CRM software for follow-up reminders or even automate follow-up emails.
Ever heard of the foot in the door technique? With this technique, you’re asking a lead for a small favor. And then another. And another. The more requests your lead accedes to, the more rapport you develop, and when you go in for the close at the end, it doesn’t seem like such a huge ask anymore.
The key with these small commitments (some call them “incremental closes”) is to start small and make it easy for your lead to say yes. For instance, upon your first contact with a lead, you might ask for their phone number so that you can get in touch more easily. After you’ve gone through a product demo, you might ask them to introduce you to the budget authority, or their procurement team.
“I love sending multiple back-and-forth emails to schedule a meeting,” said no lead ever. Trying (and failing) to schedule a meeting is both inefficient and frustrating for both sales reps and leads. In order to streamline your workflow, and reduce the friction associated with the sales cycle, use a tool that makes it easier for you to schedule your meetings.
Not sure where to get started? CRM system can integrate with meeting applications, and automatically add scheduled events to customer records.
You might have amassed several case studies, but you shouldn’t just stick these on your website and call it a day. Case studies are great for building social proof, so get your reps to actively share these with their leads, and nudge them that bit closer to making a purchase.
Bringing up case studies is also a great way of handling any objections that your lead might have. If a lead is feeling apprehensive about whether there will be a steep learning curve involved with your product, for example, show them case studies of other customers who were up and running within a short period of installing your tool.
We’ve covered several best practices that SDRs can use to increase their sales effectiveness. Now, this last tip deals with how sales managers and directors can help their team improve by ensuring that their reps get sufficient training.
If you haven’t already done so, be sure to come up with sales decks, sales kits, and other documents to guide your team through the sales process. On top of that, keep a close eye on each team member’s metrics. CRM software provides reports you can use to analyze the performance of your sales team—lead response time, activities, deals closed, etc. You might find that certain reps are struggling at specific stages of the sales cycle. If this is the case, be sure to offer them additional resources and support, and have them shadow and learn from high-performing sales reps if possible.
If you’re still relying on manual, old-school methods of tracking and managing your sales cycle, then you’re doing it wrong. Here’s how switching to a sales cycle management software or a CRM software can help you improve upon your process.
Most sales cycle management software come with automated lead scoring and profile enrichment features. Each lead that enters your system is scored based on their likelihood of converting; on top of that, their profile information is automatically updated in the system as well. To further streamline your sales process, you can also get your sales cycle management software to assign the hottest leads to your sales reps automatically.
Bottom line? With a CRM system, your sales reps will spend less time researching leads and inputting data, and more time on selling. This translates into more meetings, more sales, and more money in the bank!
Can you imagine tracking the status of your leads (and when you’ll have to follow up with each of them) in a spreadsheet? If you ask us, this is a disaster waiting to happen.
Luckily, sales cycle management software allows you to have a bird’s eye view of your sales pipeline. You can quickly sort and filter deals to locate specific deals in each stage of your pipeline, and you’ll also be able to identify how many deals are currently under review with a single glance.
If you need to follow up with a lead, make a note within your sales cycle management software, and you’ll get a reminder when it’s time to get in touch. Plus, you don’t need to access a separate app or tool to make calls or send emails to your leads; you can do this without ever leaving your dashboard.
Using a sales cycle management software will also make analyzing your team’s performance a breeze. You’ll get access to all the numbers and reports you need, including sales cycle reports that tell you how long your team is taking to convert their leads into paying customers.
Want to do a deep-dive on your team’s performance? Your phone activity reports will help you track how many outgoing calls each rep makes across a time period, and your sales activity reports allow you to tie your sales figures back to specific activities (emails sent, calls made, appointments scheduled, and more).
Last but not least, sales cycle management software also help team leaders provide the proper support and training for their team. These software and CRM systems automatically log all incoming and outgoing calls, which can be used as training material for your team.
Freshsales CRM is a sales management software that’s built to help sales teams skyrocket their effectiveness. This CRM system comes with all the features that you need, including built-in phone and email integration, reports and automations, lead scoring, profile enrichment and auto lead assignment functions, and much more.
With Freshsales CRM, you get free, 24x5 support over phone and email, regardless of whether you’re a free user or a paying customer. Want to explore the magic of sales cycle management software? Click the button below to secure your free 21-day trial.
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