What is a Sales Cycle & its 7 stages?
Those of us who work in sales are quite familiar with the term “ Sales Cycle”. It is, in essence, the process of bringing a new customer or a client onboard. This process of bringing a client is broken up into different stages such as “prospecting”, “approach”, “pitch” etc.
An ideal sales cycle is divided into 7 stages for better understanding of each process involved in making a sale to a customer. I will do a detailed article on every stage of the Sales Cycle separately but for now lets get a broader understanding of what these 7 stages are and how are they relevant.
Why do we need a Sales Cycle?
Having a sales cycle gives a thorough roadmap and common reference points to ensure the sales team understands what they are intended to do and avoid any confusion. Cohesion is important to a sales team.
A sales cycle helps in objective evaluation of progress made towards the completion of a deal.Studying the different stages of the sales cycle and analyzing them can help a sales team deduce its best practices and pitfalls.Thereby, offering a sales bible for the team to follow.
A sales cycle also sets up a framework for the sales team to prioritize different stages of the process and understand how far along prospects are in their buyer journey. If the sales team can identify where they are in the context of a sales cycle, they can analyze & deduce a way to overcome the obstacles facing them.
The 7 Stages
- PROSPECTING
Prospect is essentially a potential buyer of your product.Building target customer profiles, identifying potential stakeholders for contact, and considering the best way to approach them falls under this stage of the sales cycle.
Companies start prospecting by formulating an Ideal Customer Profile. An ICP is a summary of the perfect client for a company’s product/service. It focuses on the sales and marketing teams and helps gain important insight such as customer needs.
After the creation of ideal buyer persona, generating a database of potential leads who match that profile via popular social media platforms like LinkedIn.
2. APPROACH
After you have identified your prospects, the next stage is to initiate contact. There are multiple ways to approach your prospect,i.e via
- Cold calling
- Cold Emailing
- Introduction through Mutual Contacts
- Social media via LinkedIn and Twitter
3. QUALIFY
Qualifying is like filtering.Thereby, removing all the uncertain and non interested prospects at this stage and carrying the conversation forward with only those prospects who are willing to understand more about your product/service. You’ll want to find out if your contact person is a decision maker and,whether your prospect is in a position to make decisions or purchase.Once a prospect moves through this stage, we define them as qualified leads.
4. PITCH
Presenting the product or service is the most important stage in a sales cycle. Once you have identified, contacted, and qualified the prospects. Now you pitch your product.You should aim to present your goods or services in a way that solves an issue the customer is facing.
Be ready to demonstrate how your product will improve day-to-day operations for your customer and how your company achieves this better than anyone else.
5. HANDLE OBJECTIONS
Every customer has a hesitation before purchasing a product/service. Therefore, it is very important to anticipate objections from your probable buyer regarding the price, the terms of contract, the tenure of the contract etc.
Below are the few tips which come handy while handling objections:
- Take time to listen and understand what exactly may be giving them doubts.
- Ask questions. It helps focus on the matter, helping you find a solution quicker.
- Be ready with responses to your prospect’s objections. Even so, remain polite and courteous with your answers
6. CLOSE THE DEAL
This stage seems like the final step of the process but it isn’t.Closing the sale is easier said than done.You should never feel the need to “push” your prospect into buying, even a perfect prospect may require a little time before making their decision. Allowing time for your prospects to discuss the details of the product/service before signing up is quintessential and should be encouraged in order to boost your buyer’s confidence in you.
Offering deal sweeteners or early closure discounts can often be an important tool towards sealing the deal without further delaying the process and steering away from the competition.
7. CLOSE THE SALES CYCLE
The sales cycle doesn’t end with landing a deal. After you close, you have to work to delight your customers, keep them on board, and leverage them to generate new business. Do everything in your power to serve your customers as best you can through exemplary customer service and followup.
It’s important to remember that each sales process is unique, and no two sales cycles are the same. The sales cycle stages can be as short as a few minutes or last as long as a couple months, but in general, every sales cycle follows a form of the seven stages above.
Going through the 7 stages repeatedly will only refine your techniques and processes further.Thereby, boosting sales & multiplying business growth.
