What rules your sales team – order or chaos?
Do your reps follow a consistent and repeatable process that makes it easy to predict quarterly sales? Or are they flying by the seat of their pants, following their own playbooks, and sending your metrics all over the place?
There’s no shame if your team aligns more with the latter than the former. Some of the best sales teams start that way. But you need to take steps to change it.
It can be easily done by building a simple and repeatable sales cycle. A well-defined sales cycle is the bread and butter of a consistent sales team. It helps them close deals faster and project sales pipelines more accurately.
In this guide, we’ll help you follow in the footsteps of the successful sales rep described above. You’ll learn what the sales cycle looks like, how to manage it, and how to shorten it.
What is a sales cycle?
A sales cycle is a series of well-defined events, from when a salesperson engages a prospect until they make the sale.
Sales cycles are often confused with sales processes. While the terms sound identical and related, the concepts are different. The sales cycle refers to the steps a team goes through to close a deal, while the sales process refers to how salespeople carry out those steps. To avoid confusion, think of the sales cycle as the noun and the sales process as the verb.
Why is a sales cycle important?
Sales managers must spend time defining the sales cycle.
Clarifying the separate stages of a deal makes it much easier to assess their sales pipeline at a glance and see at which stage deals are getting stuck. That, in turn, makes it easier to improve your sales process and shorten the sales cycle, leading to more sales each quarter.
Building a sales cycle also makes predicting future sales easier and determining how many sales each of your reps should close in the following month or quarter.
Finally, a well-defined sales cycle is your blueprint for success. It makes onboarding and training new reps easier.
Armed with an accurate diagram of your sales cycle, you can help reps visualize how their sale should progress, how long the average deal will take, what conversations to have, with which stakeholders and in what order. It can also help you highlight the differences between your sales process and the one in their former company.
What are the 7 stages of the sales cycle?
We can break the sales cycle into the following seven stages:
1. Prospect buyers
Identifying potential leads will be the first step in most sales cycles. Different companies have different methods of finding prospective buyers. Some may have a list of potential targets or marketing qualified leads (MQL) they aren’t allowed to stray from. Others will have more freedom to browse LinkedIn, Crunchbase, and other sales intelligence solutions looking for potential targets.
Often, companies will have an Ideal Customer Profile (ICP) to aid their prospecting. An ICP is a topline summary of what a perfect buyer looks like, including their job title, company turnover, industry, and budget.
Most sales methodologies will also encourage reps to devote time to researching prospects before moving on to the next stage and making contact. You don’t want your representatives to spend hours researching a prospect, but anything they can find to confirm their prospect’s potential interest and help you personalize your outreach will help.
2. Contact prospects
After arming themselves with the list of names and research, your sales reps need to start cold contacting their prospects. Cold calling, emailing, and LinkedIn messages – all of these outreach methods will do the work. So encourage your team to use several of them to discover what works best.
Our data shows that honesty is the best policy if you’re cold calling. Stating the reasoning for your call early in the conversation can increase your success by 2.1x.
Also, make sure your reps are personalizing their outreach wherever possible. A good sales email will be just as personalized as a cold call.
However, this isn’t the stage for your reps to go all-in and try to pitch your product. Cold calling is the very early stage of the relationship. It’s all about building rapport and seeing if the prospect is interested in learning more. If they are, your reps can start to qualify them.
3. Qualify buyers
Not every prospect your team speaks to will be in a position to purchase. That’s why your reps need to spend time qualifying potential buyers before making their pitch.
Open-ended questions are key here. Your reps will want to understand things including:
- The buyer’s pain points
- Previous solutions they’ve tried
- Stakeholders involved in the decision-making process
- Available budgets
But don’t ask too many questions, though. Our research shows that asking too many questions can decrease your win rate. If your reps are asking more than 10 questions, you want to consider asking them to slow down.
Here’s a list of sales qualifying questions to get you started.
4. Pitch your solution
Once your reps have found a qualified potential buyer, it’s time to pitch them. Most companies will have a standard pitch deck that agents can adapt to each buyer’s unique pain points.
Reps mustn’t focus on your product’s features but instead make clear how those features can solve the prospect’s problems. Focusing on value rather than features drives the next steps more frequently than features alone.
Your reps should also be reiterating the prospect’s pain points at the start of their pitch and doing their best to keep it short and get to the point. There’s nothing worse than turning off an otherwise great prospect with a long and boring pitch.
In many cases, this sales cycle stage may repeat a few times. Where multiple decision-makers are involved, reps may need to pitch and follow up with several stakeholders one after the other. To build an accurate sales cycle, understanding how common this is in your industry is essential.
5. Overcome objections
Even the best sales reps in the world will face objections after their pitch. They must see these objections as positive, however. Objections show the prospect is interested, after all. They just need a little reassurance.
The secret to overcoming objections is following them up with questions so that your reps better understand the objection. Sales data collected by Gong shows that over half of top performers counter objections with questions compared to just 31% of average performers.
6. Close the sale
Closing the deal should happen naturally if your reps have done their job well. As any proponent of Sandler Selling will say, closing the sales is simple if you fulfill your promise to the prospect.
That doesn’t mean the deal will happen instantly, however. Depending on the product you are selling, the companies you sell into, and the number of stakeholders involved in the process, it can be months between the sales pitch and signing the deal.
The more questions your prospect asks, the more likely they are to close the deal, however. Our research shows prospects show concern about making the right buying decision 81% more on winning closing calls than they do on losing closing calls. In other words, if they start asking about your SLA, take it as a green light.
7. Follow up
Your team’s efforts shouldn’t stop after the deal has closed. It’s their job as much as your customer success team’s to maintain good working relationships with buyers.
There’s always the chance that your buyer can change their minds, regardless of how good your reps’ pitch was. Following up with them several times after the deal has closed, continuing to offer value, and getting them excited to use your solution can overcome this.
Creating a sales cycle with a follow-up process allows reps to upsell to existing customers — and isn’t that much easier? In many cases, prospects may have further evaluated their needs and be ready to pay for a premium feature or service they initially turned down. Or they may have an additional issue they think your reps can help with. Either way, encouraging your sales agents to follow up opens the door to additional revenue.
How do you customize your sales cycle?
You can use the stages above to define your team’s sales cycle. But you’ll get the best results if you customize that template in the following ways.
Replicate the best practices of your top sellers
There’s a reason your best-sellers are your top performers; they are doing things that your less successful reps are not. Find out what those things are and add them to your sales cycle.
For example, maybe you use Gong’s revenue intelligence platform to identify the kind of messaging that is working on the pitch or see that your best performers are pitching multiple times before closing the deal. Encourage the rest of your team to try that approach and if everyone sees success, then update your sales cycle.
Modify to your buyers’ needs
Your buyers may have different needs compared to the average B2B buyer. If so, your sales cycle should reflect that. For instance, your enterprise product may require a security review before or after the deal has closed. Failing to pass that security review will end the deal, even if your sales rep does a great job during the pitch. In other words, it’s not their fault, which should reflect in the sales cycle.
Your product may also influence the sales cycle. For instance, there could be a demo or trial period during which the prospect can cancel the deal. Once again, this should be treated as a separate part of the sales cycle so that you can better understand why deals fall through. Failure during the demo stage may mean your rep has oversold your product, but it’s more likely a problem with the product rather than your rep.
Calculate your average sales cycle length
Because every sales team can have very different sales cycle lengths, it’s imperative you calculate your own.
Luckily, it’s a fairly easy exercise. Simply take the total number of days for every deal your team has closed and divide that by the total number of deals. This will give you an average sales cycle length for your entire sales team.
But calculating the average sales cycle length isn’t always the best strategy. After all, you’re muddying the data by combining the deals of your top performers and your worst performers. That means you’re probably not getting an accurate average of how long each deal should take.
Instead, use only deals completed by your top performers to provide a more accurate average sales cycle length and provide a goal for the rest of your team to hit.
Track sales metrics
Sales cycle management is a key part of customizing your own sales cycle and adjusting it to the needs of your team and your prospective buyers. You’ll want to track a series of critical KPIs in particular, including:
- Average deal size
- Conversion rate
- Sales velocity
- Time spent selling
How can you shorten your sales cycle?
An easy way to get your team to close more deals is to shorten your sales cycle. While that seems like a tough ask at first, there are several strategies you can use to make more sales in less time.
Use automation to reduce non-sales activities
As a sales manager, you’ll know better than most how much time is wasted with busy work. You’ll never be able to eliminate non-selling activities altogether, but you can use automation tools like a sales engagement platform or revenue intelligence tool to streamline your processes.
Align sales and marketing
The more closely aligned sales and marketing teams are, the quicker and easier it will be for reps to prospect potential buyers. Share your ICPs and provide feedback on MQLs so marketers can do better in the future.
Follow up more and discuss the next steps
The longest part of the sales cycle is usually the gap between overcoming objections and closing the sale. Discuss next steps early and often to shorten the delay as much as possible. Our data shows close rates decline by a whopping 71% when the next steps are not discussed on the first call. The longer your reps wait to discuss them, the more they drag out the sales cycle.
Onboard and train your team faster
It’s fairly obvious that the quicker you can have new reps getting started with prospecting, the faster your team’s average sales cycle will become, right? The sooner they stop training and start working, the shorter will be your pipeline length.
What isn’t so obvious, is the difference in the revenue generated, by shaving off just one or two months in your onboarding time. You can add tens of thousands of dollars to your pipeline in the first year.
Draft your sales cycle today and watch your sales team improve
A clearly defined sales cycle makes your job as a sales manager so much easier. Your reps are able to perform better, it’s easier to identify areas to improve and you can predict future revenue much more accurately.
But a sales cycle is just the beginning. Combine it with a revenue intelligence platform like Gong and you can seriously transform your sales team. Get even greater insight into your sales pipeline and identify problematic deals before issues occur, forecast future revenue with even more accuracy, and track your team’s activity to see where they need to improve.
Request a demo today to see how Gong’s revenue intelligence software can supercharge your sales cycle.