Defining sales stages probably sounds about as boring as any sales advice could be, right? Well, the result of this is very exciting. Organizations can increase their sales success by 20 to 30 percent simply by going through the exercise of clearly defining their sales stages!
Why defining sales stages is really useful
Defining your sales stages isn’t just engaging in some tired old pipeline visualization exercise. What you’re doing is creating a shared understanding of the ideal sales process. You set up a series of “valves” in the pipeline that one by one lead to a signed deal.
If, for example, your stages are to make first contact, identify the prospect’s needs and then send them a quote, you don’t want people jumping the gun and sending out quotes before they even know what the prospect needs. You can’t jump from stage 1 to stage 3 and expect a good result.
Defining the stages of a sale is defining how you do things in your organization. It saves time and gets everyone in sync. Defining sales stages also helps you set more specific activity goals.
How to establish your sales stages
You can segment your pipeline into whatever stages you want, but to help you along, here are some examples of typical sales stages:
Create a lead idea
Make initial contact with a potential customer
Find out what it is they want or need
Make them an offer that meets their needs or wants
Offer is accepted and a new customer emerges
Of course, your particular industry and business will influence exactly what stages you create as the segments in your pipeline. Your sales procedures, products or services offered, how your prospects make decisions and other factors all come into play. Just as in plumbing, no single pipeline design fits all situations… thankfully.
Okay, but how can I define sales stages that actually fit my business?
As part of your homework, we’ll walk you through how to specifically define and optimize your own sales stages.
To begin, start by thinking about the decision making and buying processes of your customers. How do they think, how do they approach a purchase and what drives these decisions?
Write down the matching sales stages associated with your customers’ “buying stages”. It really shouldn’t take you longer than 10 minutes or so.
Discuss your sales stages with your entire sales team and get everyone’s input.
Go through all of your typical sales scenarios and make sure that the sales stages you’ve defined match with each of them. If this is going to be a group activity, it’s better in a smaller group.
Review the sales stages with your team. It’s vital that they not only understand the stages, but why they’re so important. Also, make sure everyone agrees on measuring activity at each stage or pipeline segment.
In a month or two, revise the stages once you’ve got more hard information to work with. If any of the stages are confusing, rename, remove or add new stages to accurately reflect what is really happening with your sales pipeline.
Even now, you have the tools necessary to see huge increases in your closing rate and results.