Sales cycle length is indicative of the effectiveness of your sales process. Suppose it takes a long time to convert a prospect into a paying customer. Your business might be failing at prospecting and lead generation, lead qualification, effective negotiation, or deal closing.
Regardless, the consequences are the same: Fewer lead opportunities, a decrease in sales, and a drop in revenue. Moreover, a long sales cycle can negatively affect your sales team and discourage them from giving it a 100%, resulting in a decline in team productivity.
Whatever. We've got the secrets to faster sales velocity and shorter sales cycles.
Stay tuned to find out what a sales cycle is, why you need to keep it short, and how to minimise the length of each stage of the sales cycle using a CRM system.
What is a sales cycle?
A sales cycle is a potential customer’s journey from realising a need for a product all the way to purchase. It also refers to the company’s sales processes and activities to guide the potential customer through this journey, from the first contact to the final payment and after-sales care. The sales cycle traditionally comprises the same or similar stages.
Image source: Recruitee
Officially, the sales cycle ends after the ‘Closing the sale stage’, as soon as your lead purchases and becomes a customer. Nonetheless, for many SaaS and B2B companies, it extends into an eighth stage - ‘Retaining customers and obtaining referrals’.
Suppose you want your business to grow a base of loyal brand advocates and generate more high-quality leads. In that case, you need to focus on maintaining healthy and trusting relationships even after you receive the payment. After all, referrals help generate the fastest-converting leads and, therefore, shorten the average sales cycle.
The average length of sales cycle is a key business metric that measures the number of days, on average, it takes for a prospect to turn into a lead and then into a paying customer. The benchmark sales cycle length for B2B companies is 102 days, but this figure completely depends on the nature of your product, service, and industry.
Why should you shorten a sales cycle?
- It allows companies to reach more customers.
- It generates a larger volume of sales.
- It brings higher revenues.
- It motivates sales reps to work harder.
Strategies to shorten the sales cycle
Lead prospecting and generation
A famous Slavic saying goes, “A good year beginning makes the whole year good”. Prospecting and lead generation are the January 1st of your sales cycle. It’s essential to optimise them for the whole thing to go well. Luckily, there are quite a few CRM strategies to shorten the lead prospecting and generation stages of your sales cycle.
Develop an Ideal Customer Profile (ICP)
According to research conducted by Ruler Analytics, 36.3% of sales leaders complain that approaching the wrong audience is their top reason for a long sales cycle. To access a pool of potential clients you want to target for lead generation, you need first to find out who they are. Create a detailed outline of your ideal customer.
- Make a list of your ‘best customers. Customers with the largest deal sizes, the longest lifetime value, the fastest to convert, or any other metrics relevant to your business.
- Understand what your ‘best’ customers have in common. Some things you should know about your ideal customers include the industry they’re in, their geographic location, their business size and model, and their growth rate.
- Identify their opportunities and challenges. Reflect on your ‘best’ customers and try to understand why they chose you. What problem does your product solve for them? What opportunities can they approach with it?
Ensure clean, extensive and reliable data
It’s essential to take care of the data you collect. It saves sales reps from wasting their time on administrative tasks and lets them focus on the actions that drive tangible progress and it provides your businesses with a cleaner set of data that is easier to process. The most popular ways to automate data entry include automated record creation from incoming emails and web forms.
You can automate both those processes in NetHunt CRM.👇
To create new records from incoming emails, simply click on the NetHunt icon next to the sender’s email address. The system will suggest you auto-create contact and company records that will be saved in relevant folders. It’ll automatically enrich the newly created record with the sender's contact details (first name, last name, and email address) along with the saved profile picture if it was available initially.
To automatically pull data from a web form into your CRM, you should configure the appropriate workflow. Start with the trigger: ‘Webform submitted’. Then, create and share the web form you’ll use and, finally add the ‘Create a new record’ action to have the information submitted by the lead pop up in our CRM in the form of a new contact. Here, you can tell the system where you'd like all this further information to go.
Make a list of required fields
If you decide to continue adding records manually (for example, collecting contacts at an in-person event), you have to double down on keeping data clean and complete. To minimise the chances of mishap due to human error, standardise the data entry process.
Add an array of required fields for each new record card, making it impossible to create a card without filling them out. That way, all your records contain the same information and won’t miss crucial details, mandatory for quicker and smoother deal progression down the sales funnel. Besides, you can promptly pass deals from one sales rep to another with a standardised data set, if necessary.
Create duplicate prevention rules
Speed up the sales process and avoid contacting the same people several times by creating a duplicate prevention rule in CRM. That’ll weed out duplicates upon record creation, either manually or via data import. You need to decide on a specific unique field that would act as a criterion for the check. In the majority of cases, it can be the email address.
Generate leads on LinkedIn
LinkedIn brings businesses the highest-quality leads that are easy to convert. It allows salespeople to prospect the decision-makers of companies specifically. We’ve written lots of attention-worthy content on how to use LinkedIn for sales, how to prospect on this professional social media like a pro, and even how to write prospecting LinkedIn messages. You should check it out!
Then, use a CRM that integrates with LinkedIn to enrich your customer database with LinkedIn profile information in a couple of clicks.
Successful sales are more than just having a sales pipeline jam-packed with leads. It’s not about the size of the boat; it’s about the motion of the ocean. Unless your leads are going to convert quickly, you can blow a short sales cycle goodbye. Remove sales bottlenecks with these CRM strategies.
Develop a robust lead scoring system
One of the most significant advantages of using a CRM for lead qualification is that it can help you streamline lead segmentation, making it easier to understand how likely your newly acquired leads are to convert into paying customers.
Audience segmentation also helps distribute incoming leads among the sales managers considering their expertise. For instance, if a sales rep specialises in a particular industry or geolocation. Finally, it allows for prioritising the most attention-worthy leads to reach out to them faster and, as a result, shortening the sales cycle.
To identify the quality of the lead entering your sales pipeline, put a numerical value on them. To do that, you need to decide on the factors telling of a high-quality lead for your specific business and develop a matrix containing all those criteria. Some of the most common lead characteristics to account for include the lead source, their digital behaviour, firmographic details within an account (Account-Based), and demographic information about the lead.
Align the marketing and sales departments
Once your lead is recognised as sales-ready, marketing should promptly pass them to the sales department. This is only possible when both the sales and marketing departments are aligned. If the two share the same goals, have access to a single database filled with the details of all the previous interactions with the lead, and have an established communication channel, the likelihood of closing the deal quickly rises exponentially.
We can achieve alignment between the two teams with the help of a CRM solution.
- Share common goals and build reports in CRM to see the same numbers.
- Communication, notifications, and @mentions across departments.
- Look at the same pipeline to gain insights on different processes.
- Automate moving leads from one stage to another.
Once you’ve understood a key goal for lead nurturing, you need to build an appropriate strategy that quickly propels high-quality leads further down the sales funnel. The negotiation section of your sales cycle is important, because it's make-or-break whether a lead moves into that next, closed stage.
Track your lead’s behaviour
You need to know when stalling occurs so you can step in. To identify the leads that aren’t progressing towards making a purchase fast enough, set custom views in your CRM that highlight the leads that have been stuck in one stage or haven’t been responsive altogether for a certain amount of time. Here’s how to do it in NetHunt CRM.
In the first scenario, when a lead has been engaging with your sales reps yet still hasn’t moved into the next stage, you might want to review your lead nurturing activities and find an alternative approach to the lead. If the lead has been inactive for some time and hasn’t engaged with your business at all, it could mean that they aren’t qualified enough. Review your lead qualification strategy.
No matter how potent a sales and email marketing automation feature is, it’s essential not to over-automate the process. When nurturing leads, you need to be a real person first, and only then a salesperson. We cannot replace the human touch.
It’s also important to give before you ask. Even if it feels like jumping to a ‘buy now’ CTA is much quicker, it can scare a lead away and make your sales cycle significantly longer. Nurture them with valuable content, spiced up with ‘micro-asks’ before you’ve given them enough to increase the commitment.
Be notified whenever something happens in the pipeline
If you want to shorten the sales cycle, you need to minimise the time it takes your sales reps to react to the changes in the sales pipeline. The easiest way to achieve that is to set up automated alerts sent out to sales reps via email, Google Chat, Slack, or whatever else. For example, these alerts could be set for when a lead moves their deal stage, responds to the nurturing efforts, requires help, or requests additional information.
Potential clients want to be confident that you have the required expertise and have proven experience dealing with similar cases. They want real-life examples of how your product has helped businesses with their profile to succeed. People trust people. Sometimes, a timely and relevant bit of social proof is just the ticket to nudge them towards making a purchase.
However, you can’t just throw random success stories at potential customers and hope it does the trick. The social proof you share with leads must be sent promptly upon request and contain what the lead expects to see. It’s impossible to remember all the details of past successful deals accurately and dig for them in a matter of seconds without having all your sales organised in a neat database.
Use a CRM solution to...
- Bring organisation to customer records.
- Visualise a history of your communication between business and client.
- Have all the necessary details at your fingertips all the time.
- Quickly search the database for the relevant deals using a set of filters.
Closing the deal is the most crucial stage of the sales cycle. It’s also the longest.
Use a CRM system to handle objections
It’s significantly easier to overcome sales objections when you personalise your approach. A vague ‘No, trust me, your business will prosper with our [product]!’ isn’t going to do the trick. But a ‘Yes, I understand your concern, but I’ve researched your business, and I believe that [product feature 1] can help you achieve [their goal] by eradicating [a specific problem]’ might.
Automate the whole process
Avoid stalling the deal closing process by automating quotas, contracts, approvals, and all those other boring, tedious, forgettable processes. We could stop here, but since we aim for the best results and sales cycle optimisation, let’s also tap into the question of how to use a CRM system to retain customers better and get them to refer your business to their network.
The main customer retention areas you can improve with CRM are relationship maintenance and improvement of customer support. To foster even stronger relationships with customers, you need to maintain an interest in their success and congratulate them on reaching their milestones.
Why not configure an automated email sequence that sends emails after so many days since the purchase? On top of that, you could set up a workflow to wish them happy holidays every holiday season. A greeting card goes a long way to plant your business name in a client’s mind, even if it’s digital.
For enhanced customer support, you can benefit from automatic CRM functionality...
- CRM ticketing system to keep track of all the records.
- Automatic conversation logging so you can pick up from where you left off.
- Task creation and mentions to solve problems faster.
You’re now armed to shorten your sales cycle. But remember, don’t do it at the expense of building rapport with your customers - relationship marketing goes a long way.
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