Here is a somewhat ethereal concept I have been encountering in this present economy.  It starts with this – return on investment (ROI).  ROI has been the backbone of sales since time immortal.  This is the basis of sales in that customers pay the money to receive the solution.  As long as the customer views the return on their investment as greater than the investment, they will make the purchase (generally speaking).

The top-performing salespeople possess this motivation pattern (called Utilitarian).  They view prospects in terms of ROI – how much return ($) will I receive if I invest time to close them.  This principle has changed in the present economy.

Salespeople know that spending is tight – deals are difficult to close.  I am seeing a change in the salesperson’s approach:  they are measuring prospects based on Return On Effort (ROE).  This approach is akin to taking the long road and it is a wise strategy in these recessionary times.

Salespeople are realizing that extended sales cycles are the norm so they have to focus their effort in the most strategic prospects.  Yes, you could argue the effort is their investment and that would be accurate.  However, I talk to more salespeople who speak in specific terms of their effort to close the prospect.  Is it the deal worth it?

I think this approach is born out of the lack of deals closing.  What I mean is this – salespeople are working on qualifying and closing deals, but deals are closing slowly (if at all).  So now the salesperson is stuck with fewer closes.  Instead, they have to keep their effort level elevated even though they are not receiving the return/reward they are accustomed to receiving (a sale).  The salesperson must change the metric and focus on their effort and what they will receive for it.

As a sales manager, it is important to keep the salesperson focused on keeping their effort level elevated.  A bad economy has a way of derailing salespeople, even good ones.  There will be a payoff in the long term for their effort.  Do not let the discouragement of extended sales cycles affect their Utilitarian motivation.

Leave a Reply

Your email address will not be published.

Time limit is exhausted. Please reload CAPTCHA.