How to Land Bigger Sales Deals
You might assume that sales reps working on commission would gravitate towards bigger opportunities that increase their take-home pay, but this doesn’t happen in practice. Most sales professionals prefer to chase smaller deals they perceive as easier to convert. Which is a problem because companies aspiring to grow revenue in a sustainable way, need to increase deal size.
A ground-breaking research paper in this area - ‘Why Salespeople Avoid Big-Whale Sales Opportunities’ - was published online by the Journal of Marketing in July. The study combines theories of decision-making and conservation-of-resources to create a framework for prospecting.
The international effort included analysis of CRM data for 173 salespeople working at a global lighting supplier and was co-authored by Grace XU at NEOMA Business School in France, Michel van der Borgh at the Copenhagen Business School in Denmark, Ed Nijssen at the Eindhoven University of Technology in the Netherlands and Son K. Lam at the University of Georgia Terry College of Business in the United States.
This team found that when a new lead arrives, what matters most is the seller’s initial perception of the deal size and the certainty of closing it. Key considerations include the effort needed to close it, what resources they have at their fingertips and which other deals they might have to let go in order to land it. Time and materials are finite and chasing a bigger deal might also mean giving up on a number of smaller and medium-sized deals.
These factors all contribute to the level of risk salespeople assign to each deal, and its cost-benefit analysis. Bigger deals are considered riskier and when there isn’t enough support provided by their peers and managers, salespeople tend to shy away from them. One situation where sellers do go for bigger deals is when they’ve been performing poorly and feel they need to prove themselves.
To motivate your salespeople to land bigger deals you can’t just rely on bigger commissions. Instead, change the risk profile and cost-benefit analysis of deals by implementing these three strategies:
1 - Provide them with better resources
Ensure that the resources you have are available 24x7 and easy to access on any device. Interrogate reporting numbers and question sellers to understand which are the most valuable resources and which are in need of improvement. Further empower your salespeople through deal coaching, microlearning, content support (buyer enablement), market insights and performance data.
2 - Pair them up with someone more experienced
Experienced sellers have better access to resources and more contacts within the company. The goodwill they’ve built up internally, and greater number of connections, enable them to convert riskier deals more quickly and smoothly. Less experienced sellers can benefit from collaborating with, and learning from, more experienced colleagues.
3 - Reduce their administrative tasks
Harness the power of technology - and digital transformation - to give your sales team a competitive edge. Productivity can be increased by using the intelligence and scalability sales tech platforms. The biggest efficiency gains will be enjoyed by those investing in automation and AI.
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