What is closing rate and why is it important to your business?
Closing rate is the number of deals you close compared to the number of sales pitch you make. Say, for instance, you made 10 pitch last month and closed two sales as a result, you have closed 2/10ths, or 20 percent, of your potential sales. Your closing rate is then, 20 percent. Every organization wants to increase the sales of the company and close sales faster. Increasing your sales close rate is a good place to start.
The first question is to ask yourself is, “Do you know your current sales close rate?”. This is one of several key metrics you want to measure and track in your business to help see the impact of changes to your sales process. If you do not know this, start tracking it because as a business, if it is not making any sales then you are not making any money. That is why it is imperative that you learn to improve your sales closing rate.
Taken alone, a closing rate, it provides a lot information about the effectiveness of your sales strategies. The close rate is a key element to judge a salesperson’s efficiency. Through closing rate, we can tell how many leads has the salesperson converted to actual sales. Though, it can be misleading to rely exclusively on a single figure, you should keep a close eye on your closing rates at all times. Also, allow you to adapt and compete in the always the changing market, industry trends, and other conditions that may affect sales. Close rate also allows you to determine lost sales, which are a more accurate measurement for evaluating sales performance and identifying opportunities for improvement.
But then, why aren’t people buying your sales and how to solve this?
This is the very most common rejection you can get from any prospect. When prospects say they have no time, they sometimes do mean it, the are probably honestly busy. But the mean by they are is busy is, they are saying working on other things and meeting with other people is more important than meeting with you or buying from you. If you can’t get prospects to give you a second of their time you won’t ever be able to sell to them anything.
- Solution: Create or refine your “Pre Selling” system.
Pre selling is not the time to sell your product or solution, but to see if both you and your prospect are a match. A good salesperson never sells instead they match make, ensuring both the company and the prospect are a match in every step of the way. A good pre-game helps to establish perfect fit between your company and your prospect. Once the fit is there you can then work on the needs, solutions and urgencies. A early planning can step up the decision making process and also gains commitment. With all that you can then only work on well qualified opportunities which can ultimately improve your close rate and efficiency.
No interest can be seen in many different forms. For example, conversations with the prospect is not engaged and is acting closed, no return calls or reply the emails, the prospect acts bored or distracted when you meet with them, or prospects that are very abrupt in their responses to you. No interest can also be the reason the decision maker procrastinates or defers the decision. If someone differs a decision that means they are not excited about making a decision.
- Solution: Gain commitment at every stage in the sales process.
Confirming commitment is a way to ensure your prospect is leaning into you at the same rate you are leaning into them. If your prospect asks something of you, ask something of similar value in return. If you get push back on your ask, you do not have true commitment and you should not move forward. Additional discovery on what will make them comfortable with granting your request is most often the opportunity to get things back on track.
This is a very common problem in sales and is simply when the prospect sees no difference between your product and the competitors or they actually prefer the competitors. The extra frustrating part is you may actually have something that is truly different than the competitor, but if your prospect does not see this and perceives things incorrectly in a way that they think there is no difference, you will still have the same problem. Having something different and better than the competitor is not enough, your prospects have to think you are different. When there is nothing that makes you better than the competitor, why would anyone buy from you? If you have this challenge you will only make sales when people are unaware another alternative exists. You want your offering to stick out like a sore thumb as being different when compared against your competitor.
- Solution: Disclose your sales process to your client once qualified.
Your prospect is not the expert on your product or service, but you are. Taking the lead in the process and letting your prospect know what that journey will be often sets the stage to truly bring value to your future customer. Give them the road map of a typical buying cycle for your product or service. Share what you will be expecting of them at each stage in the process. Seek agreement that they have the time and the urgency to go through this process with you. Believe it or not, this will instill confidence in your prospect – you know what you are doing and both their and your time has value.
Make your solution different than anything your prospect has ever heard of. If it can be anything that will stand out from the rest. Focus on pointing out your product or company’s strengths, choosing ones that none of your competitors have. An idea to even improve this further would be to offer a profit protection guarantee of some sort, that protects prospects financially. This would create trust and lead to investment.
If you are not getting a decision from your prospect it could be because they are just being polite but they have no belief. There are times though where the prospect has belief but they just don’t make a decision. This can happen because they are just not in the buying mode yet, they are still in the gathering information stage. In many businesses, buyers are required to gather a bunch of information before they make a purchase. Therefore if they don’t have all the information they need, they won’t make a decision. They could even have all the information they need from you and not make a decision because they are waiting on more information from another potential supplier. The other reason this could happen is because the project is being led by a subordinate and not a superior, which means if the superior is not ready to buy or not interested to buy, there will be no purchase in the near term. Finally the other option is that they have not made a decision because you have not asked them to make a decision or have not asked for the business. This is one of the most common sales mistakes.
- Solution: Provide information about your product or service
It is tempting to move right into hardcore sale-mode but you have to be very purposeful about what you share and the depth you share it at each stage of your sales process.
If they are in the gathering information stage one option to speed up the decision is to create a sense of urgency and scarcity. This could be by offering a special discount if a purchase is made before a certain date, or stating that the price is only valid until a certain date. Make the offer of buying now instead of later. Another tactic is to mention that there are limited quantities and update them. If there are advantages to the client of purchasing earlier, such as better service or easier installation then this information is very useful to communicate as well. If the project is being led by a subordinate, change your focus to the superior and work on making him ready and eager to buy, following the same process that worked to get the subordinate eager to buy. You need to ask for the business to get the sale, always ask for either a next step or a sale, never not ask for something.
5.No Easy Way To Buy
If people want to buy from you and become frustrated during the process they will abort the buying process before they complete it. Similarly if they don’t know where to go to buy, they will eventually give up trying to find out where to buy and buy from someone that it easily accessible. Finally, if the buying process takes too long to complete or too long for the product or service to be delivered, the prospect will go to someone that is faster.
- Solution: Go slow to go fast.
Go at your prospect’s pace, but work your sales process. You know how your product is bought, so stay with that process, do not cut corners, and deliver on your commitments in a timely manner. Hold your prospect accountable for their commitments and circle back, if need be, to ensure they are leaning in at the right rate. Do not be afraid to confirm whether the impact your prospect were seeking early in the sales process is still viable.
You can also survey your existing customers and previous prospects to find out what are the frustrating things about your buying process. If you can do this, you will be able to dramatically improve your results. To avoid not being able to be found ensure there are multiple ways you can be found for example social media platforms like Facebook, Linkedin, and etc. Make your contact information very easy to be found. A great way to do this is to include it on all your corporate materials like your company’s presentations, invoices, receipts, emails etc. Finally ensure the speed in which you can deliver your product or services matches or beats that of your competition. If your competition can do it faster, there is probably a way you can do it faster as well. Analyze how they do it fast and see what you can learn from them.
Here are 10 quick tips on how to increase your closing rate significantly:
1.Improve your sales scripting.
2.Set and hold your prospect and you accountable to an upfront agreement.
3.Optimize your offer.
4.Create a fear of losing to competitor to spark a call for action.
5.Give them a significant pricing incentive to take immediate action .
6.Use stronger risk reversal with clearer and more powerful words.
7.Be confident that your product or service can guarantee certain results.
8.Put yourself on the line of the customer.
9.Get better sales training for your team.
10.Shape your behaviors to be calm under pressure despite relentless over time.
If you want to further learn on effective strategies to increase your sales, do attend our MASTERCLASS BUILD TRUST FAST THROUGH NEUROSCIENCE . It is a masterclass which uses the triangulation of neuroscience, psychology and selling skills to increase conversion rate.Scientific research proof, neuroscience can increase your closing rate to 20% which gives you are steadier lead than the competitors.
Apart from that, this masterclass will also discuss real world, practical advice and techniques to tap into the buyer’s brain so that you can understand the science of neuroscience selling and how to best adapt your approach and as a result you will win more business. It will also take you through the step-by-step process for selling. Describes the types of people you’ll encounter in your sales and demonstrate Ninja-style effective techniques to get the results you need.
Act now before your competition does! This is a masterclass to be experienced, not just attended. Sign up. Take a deep dive into deep learning. Apply it. Your business and your life will be better for it.