Sales isn’t just about closing deals.
One of the most valuable skills a salesperson can learn is to say no to a deal.
Salespeople are regularly tempted with the opportunity to close deals with people who aren’t really qualified to buy from their company. While some more unscrupulous organizations and salespeople might give in to that temptation, the best salespeople recognize this is dangerously shortsighted.
Not only do unfit customers have a much higher risk of being unsuccessful and canceling, but they also are more likely to waste internal resources and give your company a bad reputation.
This is why the best salespeople ask difficult questions right from the start. They know that a major time-waster is engaging with people who aren’t truly ready to buy. Instead of trying to push a deal, they just identify these individuals as unqualified and move on.
This isn’t because these salespeople are lazy or impatient, either. Rather, they recognize there are plenty of fish in the sea for them to sell to, and that there’s an “opportunity cost” to spending their time talking to the wrong people instead of those eager and ready to buy from them.
This is the way the best salespeople do it:
1. Define who can (and cannot) buy from you
You can’t effectively disqualify buyers if you don’t know what makes someone qualified to buy from you or not. The best way to start is by mapping out your “best customers” using qualitative and quantitative analysis.
One way to do this is by looking at your CRM data to analyze the “top 20 percent” of your customers, whether that’s defined by account size, lifetime value, or other things, like customer satisfaction. You could even create a report that lets you see which deals had the greatest “velocity,” meaning which ones closed the most revenue the fastest. Do you notice any patterns in terms of company size, who the decision makers were, or other relevant indicators you could use to predict which companies are most likely to be your best customers?
Customer success expert Lincoln Murphy, of Sixteen Ventures, actually recommends starting a list of bad-fit characteristics first, because it’s often easier to spot customers who don’t have a potential for success.
2. Discover who you’re selling to
Where does the person you’re talking to stand within their organization? Are they just gathering research for their boss, or do they have decision-making power? Some helpful questions are: “Who would have to sign off on this in order for us to move forward?” or “How does decision making work at [company x]? Can you walk me through it?”
If you find out you’re not speaking to a decision maker, you should ask for an introduction to one. And if the person you’re talking to won’t give you one, at least attempt to gather enough information about the decision-making process to approach the influencer on your own.
However, sales expert Alice Heiman also adds, “An uncooperative buyer can stall the deal. If they are really interested in moving forward, they will help you understand how their company buys. Being prevented from talking to those who are involved in the decision can be an important sign that things aren’t going to move forward.”
3. Uncover their deeper motivations
You also need to think about what their incentives are for talking with you. Does it seem like they genuinely want to work with you, or are they just gathering information to check off boxes to make procurement happy?
The more you try to dig deeper into their pain points and motivations, the more you will understand what really makes them tick.
If they tell you, “We need to close more deals,” you can probe deeper by responding with questions like, “What are your current numbers, and what have you been doing so far?” or “Why do you think what you’ve been doing so far hasn’t been achieving the results you want?”
4. Probe at their budget and plans
While literally asking a prospective customer how much money they have to spend with you might be a bit crass, there are plenty of ways to figure out their budget without directly asking them. My favorite way to probe at their budget is to ask questions about other topics that would indicate whether funds are tight or ample.
For example, if you’re selling sales software, you can ask them about the size of their sales team, if they’re planning to hire more people in the near future, or other tools they might be using or thinking about using. Answers to any of these questions will give you clues about their budget, along with their overall business health and priorities.
You can always just ask, “Do you have budget for something like this right now?” but I usually won’t do that until I’ve gathered enough information to already know the answer to that question.
5. Play “devil’s advocate”
Sometimes telling people why they should not be doing business with you is actually the best sales strategy. This will help you remove people who are actually not qualified to be your customers, and such honesty can also help build trust and proactively combat potential objections.
While signing customers that are the wrong fit will definitely hurt everyone in your company who has to deal with these customers post-sale, it also hurts your credibility as a salesperson with that customer and their network. It also hurts your customers who trusted you. The best salespeople understand that their reputation is everything, and that their customers are a source of future business and references, even as they move from company to company.
As Lincoln Murphy says: “Saying ‘no’ today doesn’t mean you won’t ever do business with these people, since their potential for a successful business outcome with your company can change over time. Maybe your company will change their offering, or the customer will add the needed resources and expertise to their team in six months, which would actually be a better time to do business with you.”
Being upfront with these people from the start puts you in a position of trust and credibility, so that when they are ready to do business, they’ll choose you as their vendor.