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Speed Drives Sales, Time to Step on the Gas!

February 6, 2019

Garth Hoff / Principal Pricing Solution Engineer

Pricefx

Garth Hoff, Principal Pricing Solution Engineer, Pricefx, is a 15-year veteran of the pricing industry. He has real-world practitioner experience as a Director of Pricing Strategy, and also pricing software and services leadership experience leading solutions, strategy, sales, product management, and marketing teams. His experience encompasses products, services, B2B, B2C, and e-commerce functions at Ascend Performance Materials, IHS Markit, PROS Revenue Management, Orbitz.com, United Airlines, and General Motors – Delphi Automotive Systems. In his current role at Pricefx, Garth focuses on providing companies a future vision of what is possible with pricing software while also helping them to make the best possible decision when investing in software.

Key Takeaways:

  • Lengthy sales cycles lead to lost deals
  • Prospective buyers have often already performed 57% of the buying cycle before contacting you
  • Having the ability to align your pricing globally leads to more successful deal closing

The longer a lead lingers, the more likely it’s lost. Ask any salesperson, not being able to react to opportunities in a timely fashion, with informed pricing, will leave you out in the competitive wilderness. So, if you are not leveraging a fast, dynamic price management solution into your sales process, you are setting yourself up for a financial fall. Time to take action, define those processes and bring your sales cycles up to speed.

He Who Hesitates Is Lost

For years, I’ve heard sales reps say things like, “Time kills deals” (or TKD). There is an obsession with being the first to an opportunity, the last to present and, of course, the fastest to respond to any proposal. The short lifespan of sales leads is where Pricefx enters into the pricing conversation. Every organization needs to align its pricing processes globally and improve the decision-making processes for its prospective customers.

The Short Life of a Sales Lead – An Introduction

James B. Oldroyd is an academic researcher and professor currently at BYU. He is perhaps best known for completing a series of research studies on lead-response management while earning his PhD at The Kellogg School of Management at Northwestern – studies later updated while he was a faculty fellow at MIT. The studies focus on a number of sales factors including how, when and how fast subjects responded to quote requests.

As it turns out, Wednesdays and Thursdays are the best days to call, and between 4 and 6 PM the best times. Most importantly, he discovered that the odds of making a successful call to a lead decreased by over 10x after the first hour. After 20 hours, every additional call attempt your salespeople make actually hurts your ability to turn that contact into a qualified lead.

The Short Life of Online Sales Leads

24% took more than 24 hours — and 23% of the companies never responded at all

These findings boil down to one or two important points:

  1. The immediacy of your response is far more important than other factors (e.g., time of day…).
  2. When you wait too long to make contact and then try calling, it actually makes things worse.

Customer Engagement During the Sales Cycle

In a different study, researchers found that prospective customers spend more than half of their research time allotted to product selection before they ever contact a sales rep. It may come as no surprise to experienced sales professionals that many companies prefer to complete as much of the consideration process as possible before contacting a sales rep. This short-listing phase is a relevant part of the sales funnel, as it involves matching the fit of your offering to the needs of the buyer. As they moved swiftly towards the bottom of the sales funnel, timely and effective nurturing is required to close the deal.

The Sale Is Already 57% Complete Before You’re Engaged

Degree of Progress Through the Purchase Process Before Engaging Sales

The bottom line? Speed wins deals.

Going back to Dr. Oldroyd, we find that not only is speed of response important to gaining engagement, but it’s even more significant than that. A plurality of buyers will select the vendor that responds to their request first, and the odds of entering the sales process increase  dramatically when you respond quickly.

“50% of buyers choose the vendor that responds first.”

“the odds of the lead entering the sales process… are 21 times greater when contacted within 5 minutes versus 30 minutes after the lead was submitted.” – Lead Resource Management

Simply put, staying ahead of the curve is crucial. Sloppiness in following up on leads is inexcusable and every organization needs the tools necessary to stay competitive. Losing out due to pricing complacency is an uncomfortable lesson to learn from. Without accurate and reliable real-time pricing info, you limit your sales team’s ability to harness the data that closes the deal.

Salesforce Enablement Reduces Costs, Increases Productivity, and Wins More Deals – A Case in Point

In this case study, Pricefx was able to our client better align pricing processes globally and improve their decision making. Of course, the best strategy is useless without universal adoption by the sales force. This is why integration with SFDC for more than 1,000 sales reps worldwide was a critical factor in the success of this implementation. Speed of quoting is critical for customers who want to reduce their sales costs and improve the time utilization of their sales executives. More importantly, a fast response to a pricing request, with margin-optimized pricing, can by itself dramatically improve the chances of winning a deal.

change management is always a challenge the Pricefx leadership, development, and engineering teams provided us with the best customer solution in a timely manner

The combination of Pricefx and our integrations with Salesforce, SAP and more mean that our solution is really fast, really flexible and really effective. Basically, everything you want in a pricing solution.

Summary

In summary ,speed is increasingly critical to business success, and in the context of pricing, it’s becoming a competitive differentiator. Completing a quote that is fast, in combination with good product mix and margin optimized pricing, is a game changer for companies in highly-competitive markets. It will be those companies that implement fast, flexible and smart pricing that will succeed in a modern market driven by shrinking sales lead cycles.

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