By now I'm sure your sales team is good at uncovering the pain points and challenges your prospects face. But are they digging to get the negative financial impact those pain points are having on the prospect’s organization? Are they able to calculate what the cost to the company is for not solving the issue? Are they able to calculate the positive revenue or negative cost impact that purchasing your product or service can have on their business and bottom line? Finding pain puts the prospect in the pipeline, understanding impact leads to more closed/won deals.
I find that Sales Leaders and Sales Reps. are underestimating just how important quantifying impact is to closing business. It’s an area that new and experienced reps. alike are struggling. This is a critical step in the Discovery (DISCO) process. Without this knowledge, it will be hard for your reps. to help their prospect build a business case for your product or service. Impact of pain = Lost $$$$, lost productivity, employee or client turnover, and other financial negatives.
Let's take a look at an example based around customer churn. Here is a sample pain point and the questions your reps. need to ask to be able to monetize the impact those pains are having on the company and what that is costing the prospect and the organization.
Pain Point: Your prospect has a 15% customer churn rate
Impact Question: What's causing the churn rate to be 15%?
Answer: The customer support team is struggling to get to a 1-call resolution. 25% of calls that come into support are being escalated and are taking 3 days to resolve. Customers are stating this as a reason they are leaving.
Question: How many customers do you have?
Question: What is the ave. customer worth to the company?
Question: What would your company like the churn rate to be (this is the key question)
Ok- grab your calculator! Here's the financial impact of the churn rate being 5% higher than the company would like it to be.
At a 15% churn rate, the company is losing 48 customers x $12,000 = $576,000.
If they reduce their churn rate by 5% that will save the company $192,000 per year.
If your product or service can help them save $192,000 and if it costs less than $192,000......grab a contract and hand them a pen.
There are a lot of ways to get to the financial impact of pain. I like to use the question on a question method. This is just asking questions based on the answers the prospects give you as you continue to dig deeper into the problem at hand.
Here are some impact questions that your team can ask to increase pain and find impact as they are in the Discovery process:
- What is the effect [insert pain point] having on the organization?
- How much is not fixing it costing you?
- What's kept the company from addressing the issue?
- What is the impact that the issue is having in terms of lost revenue?
- What other areas are being impacted by this issue outside of your department/locations/division
As sales leaders, we spend plenty of time making sure our sales reps. are finding prospects that have pain our product or service can solve. There are a lot of companies out there that have issues you can solve, the ones that will actually BUY from you are the ones who understand the financial impact of NOT solving that pain is having on the organization.