Lost Sales - "How to Avoid Them"

by Phil Nasser

Win Some, Lose Some

The good news is that no one individual, project team or company wins all their proposals. Very few win even 75% of them. Most are in the 25-50% range. That doesn't mean you have to be happy with that range, it is just a fact. Lost sales do however represent a unique opportunity to learn important things about your product or service.

"We liked your proposal, but..." When a prospect starts the discussion this way your spirit naturally sinks. You know what is coming next and would rather not hear it. This is especially hard if you thought you would win the contract (or worse, had forecasted the sale).

If the decision to use another firm is final there's still a wealth of valuable market intelligence buried in that decision. To improve your odds of winning in the future, listen well to the message from your prospect.

There is no need to guess

When a prospect calls to inform you of their decision to go with another proposal, there's one way to find out what you need to know: ASK. Resist the temptation to assume you know why a contract went to someone else and use the situation as a learning opportunity.

Listen to why the client chose another solution. But also request a short follow-up meeting so you can learn what not to do in the future. Most clients are willing to help and will agree to a meeting. Take a few minutes to absorb the news and then draft a handful of questions that will identify ideas for improvement.

Perception is Reality

Most deals are lost for one of two reasons. The first has to do with youand it's this: you did not fully understand the prospect's needs and therefore, did not present a compelling enough value proposition to cause the prospect to change the way they are doing things now. Possibly you didn't do enough preparation, were superficial in your analysis, didn't talk to the right people in the prospect's organization, were in a hurry, etc. This heightens the importance of effective and thorough discovery during your meetings with the prospect. Your ability to deliver value, in a manner the prospect wants, depends on your grasp of the prospect's problems and objectives. Even slightly misinterpreting something can leave you with a flawed and losing proposal. If after listening to their reasoning you still believe you could have performed the necessary services and satisfied the prospect, you have learned it is necessary to improve your methods of discovery and presentation.

The second and more common reason deals are lost has more to do with the prospect's "perception" than with your capabilities. Their perception is their reality. Their perception for whatever reason was that either you were not able to understand their issues or were not able to perform them. Perhaps their perception of the value you proposed just didn't measure up to their expectations. This is closely aligned to the first reason deals are lost but is different in one key respect. The most important factor in a proposal is what the prospect believestheir perceptions. It doesn't matter what you believe. It only matters if the prospect has been convinced, perceives, believes you can solve his problems. Your job is to build up the images, concepts, solutions and picture of value in the prospect's mind.

Important question: "Did I miss anything?" "Is there anything else?"

To avoid the "misperception" reason above, it is vital to verify with the prospect your understanding of the needs and issues before you make any recommendations. Ask these important questions: Did you miss anything? Is there anything else? Encourage the prospect to challenge your summarization of their needs and issues. Test everything you know about the prospect including objectives, ideal outcomes, must-haves, timing and executive sponsorship. You may discover weaknesses in your fact-gathering that can be corrected immediately, on the spot. Or you may learn that you correctly diagnosed the problem, but some other element in your fact-gathering was off.

Asking those questions accomplishes several things. The prospect is given a chance to correct or supplement your understanding of any of the facts surrounding their situation. If the prospect believes you have missed one or more important points, this is their opportunity to tell you. And the prospect now knows you are being thorough. It builds his confidence in your professionalism and in your understanding of his needs. It can also prevent him from saying at a later date that you forgot to include something because he will remember that you asked the question "is there anything else?"

Will you get straight answers? Maybe!

It can be uncomfortable for prospects and for you to discuss why one solution was chosen over another. Some prospects will sidestep the issues and end the meeting as soon as possible. Others will be forthright and tell you the reasons for their decision. In either case, the investment of time and effort is worth the discomfort because you will glean at least one or two areas you can improve upon in your next proposal.

Today's loss can turn into tomorrow's win with the knowledge gained from a lost prospect.

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