You don’t want to close 100% of your sales pipeline. As a sales guy it hurts me to write this. But the fact is, many people who could buy your services won’t. And in some cases, the best thing that could happen is for them to encumber your competitor’s time and attention.
A lot of business owners assume they’re playing a winner take all game where they’ll eventually own the market. This is imaginary thinking to believe close rates can always get better, revenue can always get higher, and losing a sale to a competitor is always a bad thing.
If we’re being honest, we will not and cannot win 100% of the market. There are certain customers you don’t want for yourself – you’ll gladly pass them on to your worthy competitors. Some customers are like kelp in the surf. They drag you under and drown your productivity and moral. So, how can we think about our customers and competitors in a more constructive way?
In this blog we explore:
- They’re Not All Worth Catching
- You Can’t Catch Them All Anyway
- Controlling Can Be Better Than Owning
They’re Not All Worth Catching
We tend to spend a lot of time talking about ways to bring in more leads and close more sales. But, the fact that your business is likely better off not working with every prospect often gets missed. Everyone’s dealt with problem customers who eat up time, money, and the most finite resource of all: your mental health.
Often you can identify these prospects during the sales process. Some early indicators are a lack of respect for your time, lack of value for your skills, or an unnecessarily negative outlook on other vendors in your space. It’s a good bet that prospects who make life hard when they’re in your sales pipeline will act the same way when they become clients.
Building processes to highlight problematic prospects early in the buyer’s journey gives you the freedom to choose whether or not you want to do business with them. You get the freedom to choose which sales NOT to win.
You Can’t Catch Them All Anyway
As business owners, we have this tendency to get fixated in a mindset I call “greedy salesperson syndrome” where we think we can, and should, close every sales opportunity that walks through the door. Deep down, we all know that’s almost impossible. Unless you’re closing in on a monopoly (unlikely) there will always be a certain percentage of sales you can’t close.
Unfortunately, “greedy salesperson syndrome” sends lots of leaders into unhealthy patterns, which then creates unrealistic expectations for their team. When we’re stuck in a mindset of scarcity while striving for an impossible monopoly we’re blinded to other possibilities.
Breaking out of this greed-based mindset is freeing. Your sales team can start finding and focusing on closing only the highest value sales opportunities. Your customer support team will be able to focus more effort on serving good customers. And you get to control your competitor’s businesses.
Controlling Can Be Better Than Owning
Owning money isn’t actually that important in finance. The important thing is controlling money. Banks make money because they control the capital. When you make a deposit, those funds don’t just sit in a vault gathering dust. Instead, the bank manages the funds under its control to make a profit. They let you share of some of that profit in the form of interest, but the bank takes the lions share.
As business owners we can do something similar with our universe of prospects and customers.
Remember, ownership is less important than control. Like we discussed earlier in this post there is a percentage of customers who will be expensive for you to serve. These are costly customer relationships that you don’t necessarily want to own yourself. However, just because you don’t want them as clients, doesn’t mean you can’t garner value from them.
Back in the 90s, in the Land Mobile Radio business, Ericsson’s biggest competitor was Motorola. They were dominant and always on the edge of becoming a monopoly. The rumor was, that each year the Motorola executives would sit down with their legal team and review all upcoming contracts. They’d pick out the least desirable contracts, and deliberately loose the deal to Ericsson or some other competitor.
They couldn’t legally own all the contracts, so instead they controlled their competitors access to customers.
You don’t need to be closing in as a monopoly to use this strategy. It just takes a sales process that’s designed to highlight costly customers early and a willingness to refer those prospects, and the headaches that go with them, to your worthy competitors.
I don’t know if Motorola actually had a nefarious whiteboard where they decided the fate of the market. But it’s a powerful example that we can all model to make our businesses stronger, and our competitors weaker.
It’s impossible and illegal for you to own the whole market, so why would you waste effort acting like you can? There isn’t any need to own your market when you can control your market.
[…] talked about these prospects at length in our blog post titled “You Can’t Catch Them All”. To make a long story short, if your goal is to build a stable healthy business, then it’s […]