At a basic level, our friends at Sales Hacker define a complex sale as:
Interchangeably used with Enterprise Sales, a complex sale is typically a long sales cycle deal (sometimes longer than 12 months) that requires an RFP (request for proposal) and then winning that proposal against a sea of competitive sellers. Complex sales have large contract values and contain multiple decision makers and stake holders.
That said, there are many flaws with the boiler plate definition of a complex sale.
We all talk about complex sales, but how do we universally define it?
After asking around, I discovered that nobody really agrees on a unified definition.
One thing that makes a definition difficult is that complexity lies on a scale. At one end are pure transactional sales that operate in the thousands or millions per minute, such as day trading stocks. At the other end are massively complex sales that take years to develop, such as major government contracts for region-wide telecom infrastructure.
In the middle is a wide spectrum of sales types. Where on this spectrum, exactly, is the line between simple and complex? Some sources will tell you that a sale crosses into “complex” territory the moment it involves more than one decision maker. I find this definition to be rather extreme. After all, it’s not unusual for a buyer to inquire with their spouse prior to making a purchase on Amazon, but that is hardly a complex sale.
So what, exactly, does define a complex sale?
How do you define a complex sale?
I define complex sales based on three key factors:
- Number of decision makers
- Length of sales cycle
- Buyer’s perceived risk
A complex sale involves multiple stakeholders, a longer sales cycle, and a high degree of perceived risk on the part of the buyer.
A complex sale can involve a number of other features that are often included in the definition, such as being business-to-business (b2b) and/or involving a high dollar amount. But these features do not have to be present for the sale to be complex.
A consumer (B2C) sale can be complex
It generally takes a minimum of one month (if the buyer makes a decision right away), but more often several months to complete the sale. And the buyer generally perceives their risk as high. As a result, the seller must engage in a somewhat complex sales process to guide the buyer to and through the purchase.
For a full rundown, we’ve also built a full comparison of differences between the SMB vs Enterprise Sales Process.
A low dollar amount sale can be complex
For instance, the per-user cost of a CRM system isn’t huge, but the impact of its implementation on the organization can be great. As a result, the buyer usually takes a long time to make a decision (long sales cycle), involves multiple decision makers and influencers, and perceives their risk as high.
It’s important to note that within the category of “complex sales,” there are additional levels of complexity, such as cultural differences and corporate politics.
Like complex versus simple, these distinctions lie on a spectrum, and they depend on the same three criteria, in greater degree:
- An even larger group of buying decision makers
- An even longer sales cycle
- Even greater perceived buying risk
Thus, these three criteria can be used to place almost any selling environment in its position along the simple to complex to extremely complex sale spectrum.
What is the impact of complex sales on the sales organization?
The complexity of your sales environment has far-reaching consequences for how your organization should be structured and operated. Those consequences touch everything, from your people to your processes.
Impact on people
Salespeople must be skilled in detecting and reducing perceived risk, for everyone involved in the decision.
A complex sales environment requires a different type of salesperson and a different type of sales manager.
- Due to the number of stakeholders, salespeople must navigate multiple relationships, and have the people-skills for building and maintaining trust.
- Because of the length of the sales cycle, salespeople must demonstrate patience and skill in moving through the sales process, not miss important milestones or take shortcuts that jeopardize the deal or the account.
- Because of the perceived risk to the buyer, salespeople must be skilled in detecting and reducing perceived risk, for everyone involved in the decision.
Additionally, salespeople in a complex environment often need to:
- Have solid business acumen to understand and communicate value
- Navigate both external as well as internal stakeholders and politics
- Possess or be willing to learn consensus-building skills
- Understand and communicate across a variety of cultures and belief systems
- Be collaborative and team-oriented
- Focus on quality rather than quantity
Sales managers must possess these same skills and characteristics, plus:
- Measure salespeople based on ability to build relationships, communicate (differentiated) value and progress through the sales process
- Continually coach the salespeople and improve the sales process with best practices
- Be willing to help salespeople build the right sort of skills
- Master sales technology and how to measure the right leading indicators to ensure that everyone on the team will reach their targets
- Create incentives and corrections appropriate to the complex sales environment
Impact on sales processes and methodologies
A complex sale calls for a more granular sales process than a few stages that came pre-populated in your CRM’s drop-down list. The more complex the sales environment, the more critical the sales process – and the methodology to progress through it – becomes.
Complexity also requires:
- Different KPIs to focus on progress, not just activity
- Different skill sets, more business acumen and consensus creation
- Different methodologies to master the above
- Processes and methodologies that empower salespeople
For a complex sales team to be truly effective, their entire process and way of working must be approached as a system, and optimized for continuous improvement across the organization – very similar to how medicine and other professional fields are evolving. More structured teamwork, less individual heroism.
If you’re a CEO, sales leader or sales consultant, feel free to reach out to discuss how to drive successful sales behaviors using Membrain – the world’s first Sales Effectiveness Platform specifically tailored to make it easier to execute a sales strategy to consistently reach targets in complex sales. Because HOW you sell matters!
This article was initially published on Membrain’s blog.
The post What is a Complex Sale? (The Answer, Ironically, is Complex) appeared first on Sales Hacker.