Unless you’ve been living under a rock for the last two years, you’ve heard about “Big Data”. However, most Big Data examples concern large B2C companies. These companies are harvesting vast amounts of internet activity and point of sale data. Many of the B2B sales leaders simply dismiss the Big Data revolution. They say, “I’ll never have that kind of data, why should I bother?” This is the wrong approach. Within the next three years, the best B2B sales organizations will use “Big Data”. It will answer two key questions their sales leader wants to know:
What is the probability of this individual deal closing?
Will I make the number this year?
First, if you want to answer these questions, you have to start collecting the right data. Too often we see CRM systems completely misused by Sales Organizations. Opportunities are entered at the last minute. Customer information is out of date. The insight you get is only as good as the data entered. However, some are doing it correctly. Here are two Sales Leaders that are already getting valuable insight:
Will I Win This Deal?
Right now, most sales organizations predict deal closure probability in two ways:
Sales Stage: Each stage has fixed probability assigned to it. When a Sales Opportunity moves forward in the sales cycle, the probability increases. There is truth to this forecasting method, but it ignores all other opportunity information. For example, consider receiving an RFP. All RFP requests begin in the same stage. However, there is a huge increase in closure probability if you’ve helped write it. This is unaccounted for in a simple Sales Stage forecast projection. You need to capture data that indicates a preference for your (or the compeition's) solution.
Rep “Gut” Feel: We all know the pitfalls of “Gut Feel”. But actually it’s more accurate than a simple stage calculation. Still, it’s completely subjective. Some reps are confident on every deal. Some won’t commit to pipeline until they receive the PO. This creates a huge headache for every sales manager.
One sales leader we know named Phil took a different approach. He threw out the simple stage percentages. Instead, he embedded a “Buyer Behavior” sheet on the opportunity within the CRM system. Reps had to complete and update it based on customer-specific actions. When compared to historical deals, an accurate opportunity forecast was applied following each interaction. Deal forecast accuracy increased tremendously. Here’s a generic Buyer Behavior sheet we use. This Buyer Behavior sheet extended throughout Phil’s department. His managers steered reps away from small dollar, low probability deals. This was not a static document. His reps uncovered more buyer indications to add to the list. They removed outdated indications that proved irrelevant. This prediction capability did not require huge spreadsheets or social media feeds. It just required the right data.
Will I Make The Number This Year?
Sales Leaders are frantically looking in the rearview mirror. They want to know whether they will hit their number. Every month and quarter is scrutinized. Unfortunately, by the time a clear trend emerges, it’s often too late.
Steve, a recently hired sales leader, wanted to stay on top of every deal. He had to solve two problems.
Reps were previously compensated on Win Rate. They weren’t entering their deals until they felt confident.
There was a lack of communication within the organization on customer trends. All knowledge was tribal.
Steve instituted a change: All opportunities were entered by Sales reps, regardless of probability or deal size. He removed incentives based on win rate. He also installed a CRM app that tracked all opportunities and alerted him to anomalies.
One day, he sat down and opened up his browser. There was an alert. A key vertical had 50% less in the pipeline than the historical average. A quick meeting with Sales Reps and Managers revealed the industry was in turmoil due to government regulations. Steve had marketing create specific messaging and materials to combat it. He introduced a SPIFF to drive increase demand. These actions stimulated enough opportunities into the funnel to save the quarter. Because of new emphasis on data integrity and an investment in Big Data, Steve got his bonus. He wouldn’t have seen the early industry drop-off if he hadn’t purchased the app.
Big Data is a topical buzzword, but it can yield real results. Think back to the investment you made in your CRM system. Are you drawing all the information you want from it? It’s time to start reaping the full benefit of what it can provide. Download our Buyer Behavior tool and start tracking opportunities. You will learn which deals will truly close. It could be the difference between a year-end bonus, and a long explanation.