Tracking lost sales can actually help you generate more revenue. How you say? Only by understanding why deals are lost, can you continue to improve your sales processes, products and sales team’s performance. I am personally addicted to data and as a former salesperson, I always tracked my sales, both won and lost. By having data, you can see trends and analyze your wins and losses. Only through improvement can you generate sustained revenue growth.
As a consultant however, I rarely found companies that would take the steps necessary to track the data and I needed to understand why. I recently started a discussion in two LinkedIn groups to try to gain some insight into why a company wouldn't track the reasons for lost sales. The title of the discussion was "Do you track the reason for lost sales? Why?"
I got some great responses as to why you would track the reasons for lost sales, but no one would actually admit to not tracking their lost sales. What a disconnect! In most of my 10 years of consulting, it was rare that a company actually took the steps necessary to track a lost sale.
What I have heard over the years is simply that it takes too long. Really? Let me share the steps to tracking lost sales. Let's assume that your CRM is setup for now. When a sales person is closing an opportunity, on most of the top CRM applications, there is a pull-down list of reasons in the same box. Select the reason and that's it. So, to track the reason for lost sales in a CRM it requires adding two, possibly three, clicks. I don't believe that three extra clicks are over-burdensome. Click here to see more on Best Business Practices for Tracking Lost Sales in CRM.
What you will find is that sales people that really want to excel will want to track both their won and lost sales. Here are some great quotes from the LinkedIn discussion:
"I've learned over the years that I've never ‘Won’ a deal, I just ‘Lose’ very few of them because all deals are ours to lose." What a novel concept!
"... Great insight can be gained from understanding losses, competitive insight, process deficiencies/inefficiencies, relationship issues, pricing and general funnel management. But it is also important is to understand why and how you won as well. It’s the full 360 view of your customer engagement that provides healthy balanced corrective actions. "
"Sales people should always learn and adapt to improve their skills; feedback from their prospects or existing clients is one of the best ways to do that, as these are the targets of our sales actions and the sources, indicators of the success or failure of our actions."
"The ability to learn from a past failure can help a salesperson improve his/her skills and compensate with future closed deals - but this if and only if the salesperson in question adapts and really learns and implements the knowledge from the mistake."
So now that I've made you feel guilty, go set-up your list and start the process.
For your research, here is a great white paper that goes into win/loss analysis in-depth.
Why Companies Should Implement a Win/Loss Program
Join the LinkedIn Discussions
Do you track the reason for lost sales? Why? - LinkedIn Sales Management Association Group
Do you track the reason for lost sales? Why? - LinkedIn Sales/Marketing VP's Group