This is the eleventh in a series of posts on Practical Product Management Rules from Pragmatic Marketing.
Pragmatic Marketing Rule #11: Don't expect your sales channel to conduct win/loss analysis.
If I had a dollar for every pipeline review meeting at which we knocked a few of last month's hot prospects into the "L" column, at which point someone (more than likely me) ask "Why'd we lose?"...
Well, I might not be rich, but I would definitely have enough money to buy a very good raincoat.
And I wouldn't know any more about why we lost a deal than if I hadn't opened my mouth and asked the question.
After all, there's only so much you can learn from "our price was too high," "our product sucks," and "they went with somebody else." The reasons I've heard salespeople give for their losses is right up there with the list of sins we used to confess in grammar school: I fought with my sister, I talked back to my mother.
Asking them why we won doesn't tend to yield all that much fresh information, either.
If this were one of the questions asked on Family Feud, the number one answer would surely be - Ding! Ding! Ding! - SUPERIOR SALESMANSHIP!
It's just not in the nature of most sales people to get all analytical about why something did or did not happen.
That's what you're here for. (Many years ago, I attended a sales kick-off during which they gave us some type of short-form Myers-Briggs test, and categorized us as Red, Orange, Green, or Blue. 99% of the sales folks were Reds - Extraverts, in Myers-Briggs parlance. The home office folks were about evenly split among the other colors, with the analytically minded introverts (including all the product managers) clustered in the Blue and Green groups.)
So the first reason you don't want your sales guys doing W-L analysis is because most of them probably won't be all that good at it. Just like a product managers/product marketers probably wouldn't be all that good at sales.
You also want and need your sales people to look forward, not backward. Obviously, you want your sales folks to learn from their mistakes, your mistakes, and everyone else's, but you also need them to be optimistic and positive. Okay, they really won't be very good salespeople if they are blinder-wearing Pollyanna's, but you definitely want your sales folks to be running on half-full, not half-empty.
Further, if you rely on your sales people for Win-Loss analysis, you're also going to miss out on the opportunity to find out whether there are aspects of your sales process that need work. (Guaranteed that no sales person is ever going to tell you "I got outsold".)
How do I like to go about Win-Loss analysis?
All kidding aside, I do like to have a mini-debrief with the salesperson and (more important) the sales engineer on what they think went right or wrong. Getting an initial impression by those closest to the sale (or loss) may yield a useful avenue for questioning the new customer (or prospect that got away).
I like to have a list of questions - about product, pricing, process - that I will run through. If there's a complex sales process, with many steps and multiple people involved - influencers, decision makers - I like to talk to a couple of folks. Realistically, this isn't always feasible - especially if you're talking about a Loss. (Just like salespeople, customers want to look forward, too.) Sometimes, the best you can hope for is a good, candid conversation with the person who was your prime sponsor or contact person during the sales cycle.
In addition to specific questions on aspects of our product, pricing, and process, I also like to ask flat out - in the case of a loss - what we could have done better, what would it have taken to win, where the competition outshone us. And, in the case of a winning situation, I like to ask those same questions about the competitor.
Win-Loss conversations - which should be kept to about 10-15 minutes (or, second best, an e-mail exchange) - should occur within a week or two after the decision is made. This is especially true when it's a loss we're talking about, but you want to get to the winners when the why's and wherefores are still fresh in their minds as well.
It goes without saying that the information should be kept in some sort of a system - not on your person hard disk, let alone in paper files (or, heaven forbid, in your head). And that you should really try to make some sense of it as a whole and not just look at disaggregate information points. This is not all that easy to do when you're looking at a data containing a large element of subjective matter, but there's no point in collecting Win-Loss data unless you're planning on drawing some general inferences from it.
What can your Win-Loss analysis help you with?
- Determining what features you need to add to your product
- Refining your pricing
- Shaping your marketing message
- Homing in on a more sharply defined target market
- Improving your sales and marketing processes
Yes, lots of good things can and will come from it.
Just don't ask your sales folks to do the heavy lifting for you.
Note: This goes for both direct and indirect sales channels, of course. For indirect, in spades.