The Real Selling Begins AFTER You've Been Chosen as a Vendor
So many salespeople seem to wonder, "Now that we have been selected, why hasn't our deal been signed already?" This remains one of the delusions within deal cycles, as there is clearly a difference between the selling cycle and the signing cycle. This difference is even more pronounced upmarket (early majority). Let's consider this issue:
Let's start with the idea that the sale is completed when the customer tells us we have won the deal. This is one of the great falsehoods within the sales process, as selection does NOT guarantee that a deal is imminent. In fact, being selected merely serves as the starting point for the signing process, which likely (within the enterprise space) involves different people within the company including procurement and legal representatives (vs business and IT), most of whom are apathetic to the problem your software is addressing. the procurement/supply chain people are often incented/bonused, based on their success in driving our price downward.
The next challenge is timing; every enterprise level company has a certain rhythm that they exercise when making major software purchases. This is where having a strong business case already agreed upon with the business executive sponsor and having identified the compelling event (with financial consequences for delay) driving the timing of this deal come into play (again). Without those critical elements in place, your deal will lack urgency within legal and/or procurement. In fact, without these elements, your leverage is gone and you will likely receive pressure to reduce the software price (or other terms) in trade for accelerated timing.
Getting hammered on software pricing at this stage demonstrates the weakness in your sales process, as your already-vetted business case and identified compelling event (i.e., why now and what happens if you don’t?) should be utilized to thwart this late game pricing threat. This is accomplished by keeping your executive sponsor engaged and helping to drive the process, since he/she stands to benefit most by a timely close.
As already noted, timing is often determined in the enterprise space by existing processes; therefore, it is critical to understand the signing process for previous (but similar) deals. Having a true compelling event and strong business case can short circuit existing deal stalling processes, which makes having them all the more important.
Ultimately, being selected should not seduce you into thinking that closure is a sure thing or happening quickly. Not understanding the customer’s internal processes will cause your deal to slip out of the quarter and, possibly, into oblivion. You will need to continue to drive the business owner to stay engaged in the signing process, even if he/she underestimates the potential obstacles (which he/she often does), and continuing to remind him/her of the business value and reason (their reason, not your quarter end reason) for the desired timing. Driving an unnatural decision timeline based on your arbitrary deadlines drives down your price for this and future deals with the customer.
Being selected is an important point in the sales cycle, but it launches a new process that can either accelerate the closing of your deal or extend it, potentially for a very long time. If you need help driving the signing process, please free to ask VirtualDave for help or email me at dave@moicpartners.com.
