Nearly everyone in sales and marketing is familiar with the moment in the sales cycle when a deal stalls out due to customer inertia — otherwise known as the dreaded “no decision.”
In fact this phenomenon is so common that it is a main focus of the CSO Insights research report, “Proper Prioritization: Optimizing Revenue in 2013.” In the report, CSO Insights managing partners Jim Dickie and Barry Trailer relay a number of interesting findings related to “no decision.” For purposes of the study, only forecasted deals — not pipeline deals — were taken into account. The first finding is that sales teams close only about 46 percent of their forecasted deals. Among deals that were lost, 26 percent were attributed to “no decision.”
Clearly, something is wrong in the world of selling when deals are not lost to competitors but to the customer’s decision to not make a purchase. While this seems bleak, I would actually argue that the “no decision” described In the CSO Insights study is a step up from the passive “no decision” where the customer doesn’t choose to not move forward, but instead never makes a decision. In the words of Rush, “If you choose not to decide, you still have made a choice.” This often occurs when the customer cannot financially justify the solution and just keeps asking for more information.
Even so, losing 26 percent of deals to “no decision” is nothing to celebrate. However, as the CSO Insights report mentions, when you know you’re losing deals to customer inertia, you can formulate a plan to mitigate that impact on you. One of the solutions is better segmentation and data analysis to determine which among your prospects are most likely to lead to closed deals, and simply prioritize those opportunities over all others.
In the end, losing a deal is frustrating. But the reason you lost the sale is informative and can be used to build a framework for future success. Even more important though is learning to walk away from deals that will get stuck in the passive “no decision” cycle.
What’s the biggest reason you lose forecasted deals? Is “no decision” a major problem for your company? How do you get past a “no-decision” scenario? Share your thoughts in the comments section.