Prospect Pipeline
Reality Check
Your prospect pipeline could be hiding the reasons why
you’re not hitting your targets.
Try this reality check and get a sales pipeline that is real, effective, and can genuinely be converted into new customers.
When you’re not hitting your target a quick reality check on your pipeline and how you qualify sales leads could be the answer.
I’ve done this exercise with many sales teams that I’ve trained and managed and the results have been eye-opening.
Follow a few simple steps and you’ll quickly see if there’s a problem, and what to do about it, here’s how:
Define a Potential Customer
You prospect, door knock, cold call, research, or whatever else it is that you do to find sales leads that may be added to your prospect pipeline.
Then you take some of them through the selling process to become paying customers.
At some point in the process you will want to qualify your cold prospects.
See if they have the potential to become a paying customer.
Then you can add them to your pipeline.
In many organisations the process of qualifying cold prospects is not effective and little thought or effort has gone into this action. This leads to pipelines that are unreal.
They have plenty of prospects but a large number can never become a customer and never generate any revenue.
One Reason Why This Happens
One reason for this is that managers and directors put pressure on sales people to build a pipeline of a certain size or revenue value, it may even be a Key Performance Indicator (KPI).
So the focus of the sales person is on adding new prospects to their prospect pipeline.
Because that’s what they’re being measured on with the KPIs.
What I hardly ever see managers or directors checking on is the quality of the qualified sales leads that are added to the pipelines.
Perhaps this is because it is more difficult to assess the quality of a prospect than it is to run a report to measure a single figure like the number of prospects on the pipeline or the forecasted revenue of them.
The misguided trend of trying to manage sales teams, using spreadsheets, dashboards, and KPIs, and moving away from having sales managers that spend time interacting with their teams, means all focus is on the numbers and not the details behind them. Bean counters have their place in a business but it isn’t running sales teams.
So it’s up to you to go against the trend and do a reality check of your prospect pipeline, or of your team’s pipelines.
The first step in your action to make your pipeline a real, working list of potential new customers is...
Qualify a Sales Lead as a Prospect
Write a list of all the features a cold, unqualified, prospect must have to qualify as a potential customer.
Start with: They must have a need for your products or services now, or there is evidence that says they will have a need in the future.
Decide how you will define, ‘Have a need,’ and put time frames on, ‘The future.’ How will you know a prospect has a need for what you sell, and how definite does that need have to be.
The definitions will vary for different products and service and across industries and markets, but don’t leave anything undefined. What you are looking for is a way to define a potential customer as someone that could buy from you now or within a specified time frame.
There is then a long list of things that could go on your list and it’s up to you decide which ones are relevant to your potential customers. Remember these are must haves, not nice to haves. Your list could include:
A credit rating, able to buy a certain size order, within a geographical area, meets certain environmental or legislative accreditations, existing contract restrictions, company buying process, location of decision makers, and I’m sure you can think of many more must haves.
Check Your Definition
Run through your list and look at each of the features and double check if they are a definite sales stopper.
If a prospect doesn’t have the must have feature on your list could you still do business with them?
If the answer’s no you couldn’t sell to them without them having that feature then it stays on the list.
If you could sell to them even though they don’t have the feature then it comes off the list.
You now have definitive list of what a prospect must have for you to do business with them.
This is your qualifying criteria, and only the cold sales leads that meet your new qualifying criteria can be classed as qualified and go on to your prospect pipeline.
This ensures that every prospect you enter on to your pipeline is a potential new customer. It doesn’t mean they will buy from you, it means they can buy from you. Whether they do buy from you is now up to you and your sales skills.
Reality Check Your Prospect Pipeline
Now do a reality check on your existing sales pipeline by assessing it against your new qualifying criteria.
You can be ruthless and throw out any prospects that don’t meet all the must have features on your list, because you have a definitive picture of what your prospects need to have in order for you to sell to them.
When I’ve done this with sales teams I’ve seen high percentages, sometimes 60% plus, of prospects removed from pipelines. That means seller s had a pipeline that in reality was only 40% of what they thought they had.
When you’ve done your reality check and discarded the non-qualifiers you will see why you weren’t achieving your sales targets.
You’ll also see why the same prospects were on the pipeline month after month because they could never be closed as they didn’t meet the qualifying criteria, you couldn’t sell to them no matter how good your sales skills are.
You’ll see why the orders you forecasted you would sign didn’t happen, because the prospect didn’t meet one or more of your qualifiers and you were wasting your time.
What You Now Have
If you’ve followed the steps above you have a refined sales prospect pipeline that only has real potential customers on it.
You know exactly how many prospects are on your pipeline, or how much revenue, or how many of whatever unit your sales are measured in. So it will be clear if your pipeline needs increasing and you need to focus on prospecting actions.
You’ve got a way to qualify new cold leads to see if they are true potential customers that should go on to your pipeline. That also means only true potential customers will make it to your pipeline.
Your refined prospect pipeline may not be as big as your manager wants it to be, so you may need to discuss your actions with them before cutting away the non-qualifiers. I don’t want you getting into any trouble. But the potential customers you have on your list are all real, and that gives you a big advantage.
Moving Forward and Achieving Sales Targets
Now you’re ready to go out and prospect professionally if required, and hit your target using your new definition of a true potential customer, so where do you start?
In most selling processes qualification of a cold lead takes place on a cold call where you do two actions. You qualify the lead as a potential customer, as we have discussed above, and once qualified you arrange an appointment to meet the buyer.
On this call the qualifying is usually done at the Questioning Stage of the call, after you have completed the Introduction Stage. You can see the free online sales training, which I use when training sales teams, on this website by clicking to Questions to Qualify Prospects