Posted by Mike Carroll ● Fri, Jun 19, 2009 @ 10:06 AM

Qualifying Prospects

This week I've asked several discussion forums a few basic questions about how they qualify prospects. The responses have been terrific and I've included many of the stronger answers below ( I've also summarized the main points).

In our sales force development consulting practice, we see lots of sales people get stuck at the qualification stage of their sales process. They can book lots of first meetings and can identify several compelling reasons to move forward during those initial meetings, but instead of asking the key qualifying questions, they immediately go to the proposal stage and get shot down at the close.

To fully qualify a prospect, we recommend slowing down to make sure you understand the following issues at a minimum:

•Budget and terms
•Timeline and delivery method
•How they're going to make a decision (who decides, based on what criteria, etc.)
•And most importantly, agreement to make a decision


This last bullet is really important. We coach our clients to never prepare a formal proposal unless the prospect has made a commitment to give them a yes or no answer once they receive the proposal.

Other areas to qualify include:

•Dissatisfaction with their current provider and their willingness to leave them
•Willingness to pay for value rather than just taking the lowest price
•Where you stand versus the competition, including the status quo or the other priorities competing for their attention
•Your ability to satisfy their wish list and acceptance of anything you cannot provide
•Their criteria for doing business with you and your company
•Whether or not they are a good fit for your business - if they're really difficult to work with during the sales process, why would you expect them to change after the sale?
That's my point of view on qualifying prospects. Here are a few of the great answers generated from our discussion forums this week.

What do you do when a prospect says they don't have a budget for what you're proposing?

 

If you do an effective job of finding compelling reasons for them to change what they are currently doing, budget should not be a concern. Understanding the consequences (missed revenue opportunities, direct expenses, inefficient use of resources, etc.) and having the client estimate the financial impact is critical. If you can find consequences that are at least double the investment required to implement your product or service, serious prospects will find the money.

•If you get this objection you haven't solved the most basic problem you must solve to make a sale -- making your stack of benefits far larger than their stack of money. (Flynn Penoyer)

•Before you spent your time working on a proposal, you should have asked "Assuming that we can do x, y and z, is there any reason we wouldn't be able to move forward when we next meet?" If the answer is, "Well, it needs to meet our budget", then you need to establish roughly what that budget is. There's absolutely no point is spending your time writing a proposal for the deluxe super-duper model if they only have the money for the bare-bones model. Or maybe no money for anything you have to offer. (Daniel Jatovsky)

Many times a prospect will use the budget excuse when there is another impediment to moving forward. Could be they don't have the time to chat/be sold or they might simply not understand or recognize the value your offering brings. That's where some additional probing is required. (Kevin McMahon)

•You need to check at the beginning of the process whether there is the possibility of diverting budget if the case is proved and the budget is not allocated for such an activity. If not, look for other opprtunities. (George Petri) •How much pain do they have? If there is not enough pain, budget will always be an obstacle. (Michael Looby) How do you handle stalling prospects? "We want to buy, but not until September...."

Again it goes back to finding compelling reasons to change and creating urgency around those reasons. If a prospect wants to wait until September I like to ask "What's going to change between now and September? And based on the issues we've just discussed, can you afford to wait that long?"

•This involves activie listening skills where the salesperson needs to get to the source of the real objection...often called "peeling the onion." Perhaps the salesperson did not do an adequate job off communicating the value and ROI of purchasing now. (Scott S. Seroka)

•I may also offer a little bonus to get the prospect to make a commitment sooner. I also try to question further to see if it is truly a "stall" or they are just not going to have the funding in place until that particulal month. (David Thompson)


•Ask the prospect what might be the cost of NOT using your service now and delaying until September. If there is none, you're toast. Move on. (Robert Grede)

•During the initial interviews the salesperson should be picking up on the buying motivations, budget, those who are involved with the buying decision, the timeline and how the selection process is going to take place. (Brent Henschel)

•I have found the best response is some sort of incentive. For example, I will ask them if I can get my company to agree to give you free access, service, etc. until September 1st, is there anything else preventing you from signing agreements today. (Spencer Bewer)

What questions do you ask to understand how a prospect will make a decision to buy from you?

I like to ask a lot of questions about how they're going to make a decision. Who will be involved, what are their criteria, how long will it take, etc. My favorite question to start this conversation is "The last time you made a $20,000 investment in your business (or whatever the right number is), how did you decide to move forward?"

•Open ended questions. Tell me about your business. What do you do? What are your plans when you retire or what do you want to do with your business if you should pass away? This way I can find out information while the customer is sharing what they are proud of. (Debra Umlauft)

• I had plenty of very good competition who offered competitive options. I asked as many questions as possible to insure I knew exactly what the client needed. (Rick Hood)

At what point in your sales process do you give a prospect references?

I don't like to give references because I don't like to waste my clients' valuable time. I prefer testimonials, but if pressed I will provide a serious prospect references. But only once they have reviewed the proposal and agreed to say yes after they speak with my happy clients. If there are any outstanding issues or objections, I'll address those first and then go for the agreement to say yes once they've talked to my clients. Usually by this point they already know they're going to sign, but it makes them feel better to say "I checked their references."

•I usually try and do a 2 appoinment setting. The first is the get to know each other and fact finding. It is at this appointment that I provide references for them to check out between our next appointment. For references I use my LinkedIn site and encourage them to come here, read, and learn about me and my agency. (Paul Olmstead)


Topics: Prospecting, pipeline, lead generation, sales process, qualifying

Comments