What Is A Sales Cycle? 7 Steps You Must Know
Most of the companies have a defined sales process that they rarely change. The reason being that, defining a sales process doesn’t happen overnight. It takes a lot of strategies, efforts, and time. So once you have a personalized process, you don’t want to deflect from it.
A defined sales process in any organization will make it easy for the sales teams to sell. For eg, you won’t jump directly into a relationship, right? First, you will get to know the other person and check their likes and dislikes. Then you talk with them, go out on a date, and finally, you fall into a relationship.
Now if you understand the above example, congratulations, you know the basics of the sales cycle. But to understand this in a more technical way, I would suggest you to keep reading.
What Is the Sales Cycle?
Sales cycle is a process of strategies and events that an organization takes to sell its product/service. The process begins when you get a contact from your outbound or inbound inquiry. To close the deal, the prospect will be communicated over a period of time. All these events are what we call the sales cycle.
What Are The Benefits Of The Sales Cycle?
Without having a defined sales cycle, all your communication is going to go aimless and then will be lost over a period of time. There are many ways a sales cycle will help you but the most important are below.
1. Defines the next steps for you
The sales process is uncertain. It depends on a lot of factors and events. Who knew that the entire world is going to work from home and it was so important to build a remote sales team. So in such a situation when the sales process isn’t set and you get stuck, a sales cycle acts as a map for the sales team and then guides them on the next steps.
2. Measures your productivity
A lot of deals get trapped in the sales pipeline but that does not mean that they will be leaked. When your buyer is tagged in any of the sales stages, it becomes easier to check their progress with the sales cycle. Now when you can track your progress, it will help you improve your sales process and measure productivity.
3. Scales your sales
The basic function of any sales team is to increase revenue. Using an optimized sales cycle, you know where you are stuck. This will help you to take action and then ultimately scale the sales of your organization.
Well, now we know that the sales cycle is important for every organization, let’s explore the different stages of the sales cycle.
Stages of the Sales Cycle
The following stages are involved in a moderately long Sales Cycle, Ideal for selling both medium and big-ticket products and services.
The first step of any sales journey starts with prospecting. It is the process of finding an early-stage lead that will start your sales process. Sales prospecting can be done by researching on professional networks like LinkedIn. Also, events and conferences are a great place for the sales team to find prospects. The benefit of sales prospecting is, it will mark as the first step of your sales cycle.
When you have identified your prospect, your next step should be connecting with them on the discovery call. You don’t want to keep that person waiting for a long time, so acting quickly will be an advantage.
In this stage, you do not pitch your product/service directly. The interaction during this stage is too early to sell. Sending them educational content in the form of videos and blogs will make it clear about their intention of purchasing or not.
You can connect with your prospects by giving them a call directly or sending out a cold email to them. If the prospect has reached out to you from social media then you can cold email them or else a cold call works too.
When you have connected with the lead its time to check whether they are worth your time or not. This is one of the most critical stages. If you qualify a lead that is not your ideal customer, every stage after this will crash. From this step, you start selling your product/service.
The qualification process will help you to prioritize the prospects.
For example, for an email marketing tool, the ideal customer is a sales representative, who sends a lot of cold email campaigns. But say a recruiter who wants to send email campaigns to consultants, also happens to use the tool.
Now during such situations, if you have a defined lead qualification process, you will know that sales reps are your priority and you will give them more time. In this way, qualification plays a major role.
To make it easy. You can ask the below questions for qualification.
“What is your role?”
“What problem are you trying to solve?”
“Why is this a priority for your business?”
“What other solutions are you evaluating?”
Now since you have qualified your lead in the above process, it’s time to “sell”.
You need to schedule a demo of your product and make them understand that the product/service is specifically for their business. Demo call is like giving them a tour of what you are selling them. It will make them trust you with your product/service.
In this stage, you have to include the decision-maker of the organization. Your entire focus here should be to convince them that you are aligned with their interests. The sales pitch should be targeted towards the organizational goals and not individual goals. Or else it will look like a bribe. The best way here is to talk about numbers. Tell them how your product/service will impact and scale their business X times.
When you have presented your product/service, it’s time for the prospect to think about. Often after the present stage, the process passes through some blockages.
There can be situations where they feel the price is too high for them, they don’t have a budget for now, etc.
Ask them what is stopping them from buying your solution. Is it because of some bad experiences in the past? Listen to the prospects and understand their side of the story. Don’t hesitate to ask them the context of the issue they have addressed.
After you have listened to them, you might want to restructure your sales pitch depending on the current situation. For eg, if the issue is still about pricing, break the price for them into days and not months. $100 per month solution can be sold by selling it for $3 per day which is less than a coffee at Starbucks,
After you are able to pass through the objections stage,, it’s now time to close. It may look easy but it’s not. Your prospects may have some new questions and if they are not solved, it might extend the sales cycle and make it longer.
It is very important to move this stage carefully and delicately after you receive a confirmation from the other side. You might want to involve other departments like accounting, logistics, etc. in this closing stage. Might be possible that the other side has their own cycles and processes which you would want to clear out before closing the deal.
Many deals drop out at this stage and it might not be in your control. So act carefully and then delegate the task to the marketing teams to nurture if needed.
If you think you have done your job and it is an end of your task, well, not actually. To bring in more business and achieve your sales quota, you have to ask for referrals. The new customer that you just made, is really excited and would love to share recommendations with you.
Sales referrals are that low hanging fruits that most of the sales reps do not touch.
A happy customer has high potential to bring more people to your table. But all of it is possible if the customer is happy and satisfied with your service.
Creating a sales cycle may look complicated, but if followed properly it is simple. The entire sales cycle depends on how the sales conversation is carried out. With the help of conversation intelligence tools like Convin, you can identify the types of sales conversations that happen and understand what success looks like in each of those conversations. It will also equip your reps to execute. If you know how to tackle every type of sales conversation, the sales cycle becomes easy.