As most SaaS sales leaders know, the rule of thumb conversion rate to take a deal from “Opportunity” to “Closed Won” hovers between 20 and 25 percent. Our customer, Datanyze, has increased their win rate by up to 30 percent. And, the company is moving opportunities forward a full 50 percent faster than it used to. We won’t share specifics as they’re in a competitive market, but some parts of his secret sauce can be generalized for everyone’s benefit.
TL;DR - Increase your win rate and decrease your sales cycle through well defined sales stages and consistently executed Next Steps. Set a higher bar for what constitutes an Opportunity so you focus on the fewer deals that matter. Shorten your sales cycle by treating Next Steps as an agenda item and giving it the time it deserves.
Stacking the Odds to Game Sales Win Rate in Your Favor
Datanyze, which enables technology companies to sell and market more effectively using technology usage data and other buying signals of prospects, has honed its sales management process through observation as well as closely measured trial and error. Their sales team succeeded in pushing up the rate of success while compressing the time to close.
Highlights of this approach include:
- Focusing on Target Accounts: Pre-qualifying accounts ensures every conversation gets qualified according to specific criteria. This approach reduces internal friction and the need to ask qualifying questions.
- Defining Concrete Opportunity Stages: From a process perspective, they define concrete stages tied to verifiable actions. For example, to advance from Stage 1 (Sales Accepted) to Stage 2 (Data File) the customer must have completed a second conversation that included reviewing a data sample they had to provide.
- Treating Next Steps a Critical Agenda Item: In tactical terms, advancing the stage requires verifiable actions by the future customer. Datanyze AEs treat Next Steps as a "real" agenda item and dedicate 5-10 minutes of real conversation to it in each meeting.
Datanyze does things a bit differently from other companies. Here is a rundown of how their distinctive sales process achieves a higher win rate while cutting the time to close:
- Tying Opportunity Stages to Objective, Verifiable criteria. Many companies tie opportunity stages to subjective assessments like “Pain identified”. This is critical but open to interpretation. Something concrete like “Template completed” or “Success Criteria document verified” is unambiguous and requires the prospect’s buy in.
- Requiring “Skin in the Game.” This is the role the Data File plays. If the prospect agrees to complete a short information template or invite a specific person to the next meeting, for example they are putting skin in the game beyond simply taking another meeting with you.
- Creating a Feedback Loop. A prospect not willing to take an Action Item is telling you a great deal about the true status of the opportunity. By not agreeing to a concrete action, they’re indicating that 1) Your product/solution is not a priority 2) They don’t see how it addresses their pain/issues 3) They aren’t where you think they are in the buying process. For the AE, this situation should prompt the following very important question: Should you commit more time to this opportunity or move on? The prospect’s inaction gives the AE feedback in the meeting that whatever happened in the meeting did not do enough to move the buyer forward.
- Treating Next Steps as an Agenda item. In many sales meetings, next steps are an afterthought left to the last two minutes of a conversation, e.g. “I’ll send through some information by email.” When you need buy-in for a specific meeting to cover specific topics with specific pre-work, it’s a conversation that requires the prospect to agree to doing something tangible by a specific time. Reviewing a Mutual Close Plan serves part of this need, but this approach applies as early as a Discovery conversation.
The flip side is that fewer opportunities advance, but those that do are more likely to close - and close faster.
Putting The High Win Process into Practice
You can move from theory to practice with a few small steps:
- Agree on objective, measurable advancement criteria by Stage that meaningfully weed out unqualified prospects early in the funnel.
- Measure your baseline advancement rate and sales cycle to understand your current state. A product like InsightSquared or Aviso can help with this.
- Expect a decrease in Opportunity advancement rate at the beginning
- Refine the approach based on feedback.
AI Insights from Over Half a Million Sales Meetings
We have analyzed almost one million meetings across our customers with our AI platform, Chorus.ai. We work with customers to surface actionable insights unique to their sales processes because every sales process is unique. What’s true for one customer does not necessarily hold true for others.
Chorus records, transcribes and analyzes meetings in real-time. Our AI automatically maps the conversation to the appropriate Lead/Account/Opportunity in your CRM. With both the transcripts and metadata from conversations, Chorus surfaces patterns in advanced, won and lost deals.
We look at conversations as a collection of moments. This enables us to recognize patterns in conversations. For every moment we combine metadata (e.g. sales outcomes from the CRM) with insights on the conversation. We think of it as the ‘What’, ‘Who’, ‘When’ and ‘How’ of a moment in a conversation.
To detect Next Steps, our AI has learned thousands of ways to identify things like follow-ups, scheduling or sharing collateral. We focused on Next Steps mentioned in the last 10 minutes of a meeting (ignoring, for example, Next Steps being raised as part of the Agenda at the start of the meeting.) Chorus allows us to analyze things like “When in the conversation did a ‘prospect’ engage in setting next steps? How engaged were they at that point and what was the exact framing?”
Actionable Takeaways from the Data
- Don’t forget next steps. This is obvious but worth highlighting. More than 20 percent of meetings did not have a single next step or action item.
- Summarize and repeat next steps. The data suggests meetings with more next steps drive up win rates by 13 to 20 percent. Does that mean account executives are setting more next steps? Not necessarily. They typically repeat them to ensure buy-in from prospects.
- Don’t leave Next Steps (just) to the end of the meeting. Overall, 48 percent of Next Steps are mentioned in the last 5 minutes of the call. The chart below shows the cumulative frequency of when Next Steps come up in conversation for “Closed Won” and “Closed Lost” deals. Won deals discuss “Next Steps” much earlier in meetings, suggesting reps are surfacing opportunities to follow-up, send through collateral or involve further decision makers. Lost deals cover the majority of their “Next Steps” in the last few minutes of the conversation - almost like they’re being squeezed in.
- If a prospect talks about an action item, win rates increase by 6 percent. Only 40 to 45 percent of meetings have the prospect involved in discussing / setting ‘Next steps’, but when they do, the likelihood of a deal advancing is much higher. It sounds obvious, but when a prospect says what they’re going to do, it’s a good sign they’re bought into the process.
It is possible to increase your sales win rate without stretching out your sales cycle. Getting there involves some work, part of which takes being realistic and pragmatic about how your prospects actually signal purchase intent. As the Datanyze example shows, being more focused on Next Steps is arguably the most important part of the process.