How to Lose Better in Sales

Neil Patel Winning Quote

Like most salespeople, I made a lot of mistakes early in my career.  But I was taught an axiom rather soon – “70% of all deals should be winnable.”

By learning to mark deals lost earlier in the sales process and of my own accord helped me spend more time on deals that were winnable and less on those that weren’t. Consequently, I felt that the deals I spent time on were genuinely at least 70% winnable, keeping my sales pipeline clean and my sales velocity high.

Three key things to learn about losing in sales:

  1. Turn reactive losing into proactive losing, based on your judgment of whether they fit into the 70% winnable category. This means shifting most of the losing from the end of the sales cycle toward the beginning.
  2. Codify, standardize and review your reasons, and make your criteria rock-solid. Every week, review all open deals as well as the lost deals from the previous week. Understand your losing and winning categories (on price, on product features, in a specific industry, or other) and fine-tune your tactics on a weekly basis by learning from this knowledge.
  3. Know your ideal customer profile, and figure out how to get as many prospects who fit the profile into your pipeline. The ideal customer is one with whom you have the best possible strategic fit across the board – you have great product/need fit, buyer/seller behavior and cycle time fit, and budget/price fit.

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A more thorough overview of the important things in losing:

1. Mark your deals lost early – lose fast

Everyone of us has what I like to call a CPU (central processing unit). It’s your brain. Having deals with less than 70% likelihood of winning in your pipeline takes up a lot of CPU computing power. Even if you aren’t spending a lot of time on these deals – deals that I like to call undead – they are still somewhere in the back of your mind, glimmering false hope of cash flow and profit.

The key factor to sales success is pipeline velocity – the speed at which you’re able to move deals from your first contact with a prospect to a successful close. Having lots of undead deals sitting in your pipeline means your pipeline velocity considerably slows. They take up screen space in your pipeline, and they make you think about them every day while never moving closer to a close.

Often what you get when you speak to this kind of prospects are empty promises, such as they’re going to review the purchase opportunity next month and get back to you, or that they are waiting on a budget decision that should arrive soon. The reasons vary, but one aspect stays the same – these deals take up a lot of your attention and time, and they’re unlikely to end up as won.

So what should you do?

You should be open and clear with your prospect by proactively asking straightforward questions. One of your questions should be, “Based on the need you told me about, and the solution we discussed here, do you see yourself buying anytime soon, like in May or June?” You can use it in different sales stages in a slightly modified way.

If the answer is “we’re not sure,” or “I can tell you in a couple of weeks” or anything similar, you should politely end the sales conversation. It’s valuable to learn what’s behind the “we’re not sure” responses, but if evidence of not moving forward exists, you should stop exploring this particular opportunity. Lose the deal, get it out of your pipeline and start focusing on the deals you can win.

2. Sales managers, know your reasons for winning and losing

How you should manage your reasons for winning and losing as a sales manager is about codification and standardization. You need to agree first on how to mark your deals lost – what you include in the description is important, as it will help you analyze the categories you are losing in, the behaviors that are inhibiting your salespeople from winning and so forth, giving you the insight into fine-tuning your sales machine for better results in the future.

Reactively marking a deal lost in Pipedrive

Reactively marking a deal lost

Marking a deal lost reactively vs. marking a deal lost proactively

Proactively marking a deal lost in Pipedrive

Proactively marking a deal lost

At your weekly sales meeting, always talk through the open deals your team has, as you’ll understand the potential pitfalls and brakes and address them.

It’s just as important to talk through the lost deals from the previous week, as you’ll be able to see what went wrong. A key aspect here is the standardization of lost reasons. Over time, you should have an overview of the categories you lose in the most and the reasons why. Standardize these reasons, so that you could start getting statistical insight into your team’s behavior. You as a sales manager should encourage as much detail as possible to be included in the comments section of each lost reason, as this will provide valuable context.

By collecting the lost reasons and reviewing them on a weekly basis with your team, you’ll be able to understand the different ways your salespeople stuck. As you collectively go through the lost reasons, other salespeople can suggest how they deal in similarly problematic situations, how they overcame a specific objection or how they drove a similar deal faster. You may discover that different salespeople get different reasons for losing from potential customers. And that’s worth studying.

Tactically, this will give an immense return.

It gives rise to continuing training, using the strengths of your team to address the weaknesses of your team, driving the consistency of your team’s overall quality.

Just as importantly, it could give you insight into improving your product or the whole sales process.

I’ll give you an example how you could perform a category analysis using data from Pipedrive. For understanding the aforementioned trends, losing categories and losing reasons, you’d use the “Deal Lost” feature. First, make sure that everyone in your team uses the lost reason and additional comments boxes, so you could go back to the data.

To filter lost deals, add a new filter in the list view and include the following:

  • Deals – Status – is – Lost
  • Deals – Lost Time – is – last week (or other time frame)
    Lost deals filter in Pipedrive

    Example filter

Now, simply include the lost reason column to your list view, and hit the export button below. Once you’ve taken these steps, you can offer a meaningful statistical analysis on your team’s performance – weekly, quarterly and yearly. Standardizing lost reasons means you can always go back to the data, analyze it and improve your sales activities accordingly.

Filtered results in Pipedrive for deals lost last week

Filter out lost deals from last week

3. How understanding your ideal customer profile will let you lose better

Understanding your ideal customer will make it easier to mark deals as lost since you’ll have a better overview of whom you should and shouldn’t be working with. There are a few simple questions you should ask yourself, when looking into whether a prospect fits your ideal customer profile:

  • What needs are you most successfully addressing with your product/service? Which companies have the best product/need fit?
  • What people are you most successful at selling to? Are they managers and specialists looking after their departments? CEOs and owners addressing the pain points in their company? Someone else?
  • Are the decisions made by a committee or a single head of department/company? Are the decisions based on return on investment or internal conviction? Are budget decisions central or business-unit based?

Find out if your prospect fits your ideal customer profile; if the prospect doesn’t, consider marking the deal lost sooner rather than later. Losing early thanks to good qualification gives you the opportunity to focus on the deals that you are more likely to win.

Moreover, focus on the wider picture. How can you get more “ideal customers” into your pipeline? For this, analyze the customers who fit the archetype and work your way back to how and where you found the prospect, and which activities you undertook to win them over.

Once you get there, you can start marking deals lost even before you’ve made heavy investments in winning the deal, and marking a deal “lost” will start moving from the end of the sales cycle toward the start of the sales cycle.

The biggest struggle in marking deals lost proactively is having the courage to turn away the non-ideal types – especially so if they look appealing by having large purchasing budgets.

However, people will appreciate your ending the conversation and not wasting their time.

What’s more, when people don’t feel pressured, they might even flip a bit and wonder about what they might be missing. The earlier you’re able to make your intentions and expectations clear, the better for both parties as you’ll manage to establish honest communication. You’ll start hearing a lot of “cheers, thank you” but also some “wait, wait, wait, I still think we have one specific need we should talk about.” That’s because you’ve created a buying atmosphere with this openness.

Execute and don’t deviate

Much of this blog post has been about being proactive, not reactive. The most important part of any sales plan is execution: Can you and your team follow the plan that you’ve set?

If you have the courage and persistence to execute the proactive losing plan, while constantly analyzing your lost reasons, you’ll start improving your hit-miss ratio immensely. Work only on deals that are 70% winnable, and get everyone else to do the same.

Epilogue

In a previous life when I was selling training courses to companies, I hired a young and bright new salesman – smart and hard-working, well-prepared for presentations, and so on. But more importantly, his pipeline looked absolutely fantastic at the beginning of each month, making it seem as if all upcoming months were about to be great for sales.

After a while, however, we realized he was having challenges. He would begin a month with 10 great leads, but by the end of that month most of them wouldn’t have moved one bit along his pipeline. So what was the problem? We discovered that he was getting the“we’re still thinking about it” treatment. When our new hire changed his tactics and asked his prospects whether they were ready to place an order that month, he found that only one was willing to purchase.

Moral of the story? Had he been better at losing, he would have been far better at winning.

Luckily, he learned.

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Timo Rein

CEO and Co-Founder of Pipedrive

  • Mark

    So if the lost reason should be standardized why is it an open text field? It would definitively make more sense to have a dropdown/combox control.

    • Hi Mark,

      We agree. And we have a feature in beta already that enables the admin to set up a list of lost reasons that the sales people can choose from. It will surely be made publicly available and maybe also default in the near future.

      For now support can enable it on your account if you’re interested. Please simply reach out and they’ll switch it on for you.

      • Mark

        Excellent! Very quick followup!

      • Varun Mayya

        This is some really good followup. You definitely earned yourself a new user.

      • Felipe Grau Zabala

        Please enable my company account the beta combo box so that only the admin can list the lost reasons !
        My email account is felipe@papinotas.com and the company is “Papinotas Ltda”

        • Hi Felipe,

          We’ve enabled it on your account now. You can set up the reasons from this page here https://app.pipedrive.com/settings/company_settings#lost_reasons

          • Felipe Grau Zabala

            Thx 😉

          • Max Pardo

            Hi could we also get this set up?

          • Martin Henk

            Hi Max,
            Unfortunately I can’t find you based on your name. Can you please contact support through the Help & Feedback box in the app and request the predefined lost reason feature to be enabled? They will be happy to help

          • Melvin Hines

            Hi Can you enable this for my account as well. The account is melvin@upswing.io. Thanks!

          • Hi,
            Sure. I’ve enabled it for your account now. Please look at Settings, Company settings to set up the reasons

          • Helene Carrer

            Hi! Can you enable this for my account? helene@salvopelogongo.com.
            Thanks!

      • Dorothea Utzt

        Can you also enable the beta feature for Streetspotr GmbH please? Thanks 🙂

        • Hi,
          Sure. I’ve enabled it and you can set the reasons from Settings, Company settings.

          • me too please jay[at]sumhr.com

          • Done 🙂

          • basa71

            Could you please add this for us too? domain is TenderOne. Cheers!

          • Martin Henk

            Hi,
            Done.

  • This should be required reading for every sales organization. Everybody likes to hope that, somehow, this inert laggard will somehow turn into a deal. Everybody’s afraid to cut them loose.

    • Hey Mike, I’m glad you liked it!

      I just remembered a case where I learnt the hard way about “cutting them loose”. In 2000, I was in a door-to-door sales program during the summer, and early on I really struggled to trust non-buying signals and hoped that somehow being with it will end up in a sale. So, instead of wrapping things up, and moving on after there was no clear interest signal, I stayed with a prospect for twice as long I would normally do. I mean, she was very polite, actually kind of liked what I was selling, and I’d say we had a very nice conversation.

      However, I had no experience to tell the difference between a nice conversation and the one with a potential of closing quite yet. In fact, I relied on the hope that at one moment she would say “Ok, I’ll buy it”. (It’s easier to realize now that I failed to be clear enough in my questions about whether she actually would consider buying, and I was waiting her to tell me that at some point – very deadly approach but I hadn’t experienced that yet).

      Well, she did wrap it up at one point, saying “Hey, I gotta go now and pick my kids up from soccer practice, but it was very nice to talk to you!”, and gone she was. I was so disappointed, and angry that I had lost valuable time to meet other potential customers. At first, I was angry at her for “leading me on” (!). The truth is – she just talked with a stranger, and didn’t literally have to do anything. It took me days to fully understand that it was all my fault. But once I did, I started to check the interest to buy from thereon, trust the answers I got to those, and only continued the conversation when there were clear signals of buying.

      Just thought I’d share as a proof that we learn better with a painful experience along the way.

      • Oh, man, you just triggered a flashback to my first sales job, in retail jewelry, just out of college. The store manager had to leave for a couple hours. A suspect got really interested in a multi-stone ring for about $1500, which was a big sale in those days. He said, “I’ll be back for it.” The manager returned and asked how I’d done in his absence. I said, “I sold a $1500 ring.” He looked at the sales slips and asked where that one was. I said, “Oh, he’ll be back.” The manager said, “Uh huh.” A little later he asked, “Mike, where’s your guy?” And again after another hour or so. A bit after that he exclaimed, “Mike, I see your guy!” I said, “Where?” He said, “Over there, by that pole, laughing at you.”

        That’s the day I learned that, when you see someone’s shoulder blades, that’s the last thing you’ll see. “Yes” comes right away; “no” takes forever.

        Here’s a blog post I wrote about it more recently, in a professional services context. http://www.rainmakervt.com/resultsmailvt/2014/6/10/yes-comes-fast-no-takes-forever?rq=no%20takes%20forever

  • Excellent read!! I have been a salesperson for many years now and this article is great in getting sales team to be productive. I use plenty of methods as well that help in increase your sales performance at my blog! thanks for sharing this

  • George Gonzalez-Rivas

    This is a very good piece with useful insight and actionable suggestions. It’s just too long! ;-(
    I put off reading it until “I had time” — that mythical empty space on my calendar. You might consider breaking these up into more/smaller nuggets?

    • George, thanks for the feedback! I hear you :). We’ll see how we could address that next time, I like your suggestion.

      • Lewis Clayton

        People that think they do not ‘have time’ to read this are probably busy chasing the ‘I’ll get back to you in a month’ deals!

        Timo, a great read and an approach I wish more of us (including myself) have the courage to undertake.

  • Varun Mayya

    Really insightful article. At Jobspire, marking lost sales early actually helped us identify our target segment much better. A little fine tuning to the messaging and we were able to improve our rejection rate down to less than 5%.

    • There you go, Varun! Thank you! Would you be willing and able to share what you did to tweak the messaging?

      • Varun Mayya

        All our failed sales leads were because we were pitching “features” instead of benefits. Companies started comparing us to existing solutions in terms of features and we ended up receiving rejections because of “you don’t have X feature” or “feature Y should’ve been here”. We realised this and stopped pitching features, instead telling people about the experience they could be giving their audience.

        Worked well for us.

        • Evan Serling

          This is exactly what Claude Hopkins teaches in his book, Scientific Advertising. Don’t sell your prospects on all the features of your product, don’t focus on the “bells and whistles” at all.

          Sell your prospects on how your product or service will make them feel. People want to know that they will enjoy the product and feel good about it. They want to know that their life will be better or easier after they purchase. So project that feeling of comfort and satisfaction they get by using your product and you will win every time.

          Like if a cruise ship was to advertise their next big trip to the Bahamas in a magazine ad.. You’re not going to see them focusing their copy on how many rooms are on board, how nice the plates and silverware are, or how many jacuzzis they have on deck.

          Instead they would tell you how their luxurious accommodations will transport you into the escape of a lifetime free of all worries and stress. How their professionally cooked meals will make you feel like you’re eating at a 5 star restaurant at any hour of the day. And how relaxing it will be to soak in one of the many deck side jacuzzis while you watch a beautiful sunset with your wife, floating across the ocean.

          Think about this the next time you open a magazine and look at all the ads you see. It’s easy to see which companies understand this concept, and which companies are stuck in the “feature comparison” mindset that gets them nowhere.

  • Leandro Valencia Vio

    Awesome! Thx a lot

  • Ben Philabaum

    Love this: “Lose the deal proactively, get it out of your pipeline and start focusing on the deals you can win.”

    I’ve noticed that 90% of the deals my agency wins close within 3-4 weeks of first contact. But the one’s that have been dragging along for months have been taking up the most mental space.

    • Ben, I feel the same way! Great observation – I think that it has led you to discover one attribute of an ideal customer for you (time to close).

      I remembered one more thing – there was one useful tactical approach that I used a lot in case the signals I got were unclear. I tried to get the prospects open up, and tell me if they wanted to move forward, or opt out. I said something like this: “So, I have seen that when I’ve talked to people, and we’ve gone through their current situation and needs, and they’ve seen what our solutions are, then they’ve got to the point where they know if they want to get it or not. How do you feel about it now – do you want to do it?”

      In most cases, I got quicker to yes or no (and out of pipeline), and in some cases, I heard about objections that I was eager to get to the bottom of, and see if there is a way to overcome these. I’ve loved this tactical piece quite a lot, in short.

  • Ramon

    Thanks, Timo!
    I am always afraid about losing sales opportunity by marking deals as lost before they make clear we will not close the deal. Anyways…I think it’s worth it.
    My question is… Even with the lost deals, I can schedule some activity. So, I use to schedule an activity like “Email this lead in 3 months to check another sales opportunity”. Do you think it is a good a idea? (Those activities are still coming so I cannot tell if it worked or not)

    Thanks!

    • Anthony

      I started a pipeline called stagnant, in which each stage refers to a different product category. This way it does not clutter my sales pipeline, but I have the suspects for each category at a single place. However I don’t schedule any activities for them, however they do get sent important developments of the products they are interested in.

    • When you mark them “Lost,” you’re really just transferring them out of your expensive one-to-one sales pipeline into your inexpensive one-to-many marketing funnel, which you can nurture with drip email campaigns.

  • The Ideal customers/client Profile/avatar (it goes by many names) is a big key to closing deals early…or better yet not even initiating in a conversation because they don’t fit initial basic criteria.

    With ansleyRDgroup we produce deliverables for our clients in addition to business development coaching/consulting. Last year we set out to differentiate ourselves in the web development and graphic design market place. We what found were two things.

    1. Those clients of ours whom we were already coaching/consulting, needed deliverables. Since we were already (intimately) involved in their businesses; it made the most sense for us to produce the deliverables as we already understood their business and audience.

    2. Those clients that were coming to us, starting their relationship, with a deliverable (ie a Logo) had little clue that graphic design is different based upon the ideal client avatars. So we began including specific modules and aspects of our coaching into the deliverable.

    Did this raise our prices? Yes. But it also communicates to our clients that we are not your average design firm. We dive deep to understand their business and only design/develop/recommend things that we ourselves would do for our company.

    This change resulted in several benefits:

    1. A new level of trust was built with our clients

    2. Client relationships are/will last even longer (we already have a very long track record)

    3. We are doing more of what we love the most in our business (coaching).

    4. Revenue/Profit per client increased.

    The Ideal Client Avatar is key!

    Jason Ansley
    ansleyRDgroupBusiness Development Concierge

  • Antony Quinn

    That’s great advice, however Pipedrive does not make this easy. There isn’t the ability to have a drop down for lost reason and the lost reason additional field doesn’t show on any reports. We’ve had to resort to issuing little bits of paper to stick to your monitor for the standardised lost reason (and then have to tidy up when people inevitably do it wrong) and had to add a custom field in order to show our additional lost reason

  • lucianocastro51 .

    Someone help me!!?
    I´ve read a lot about the Pipedrive tool, and i´m willing to use it soon.
    But i´m procrastinating this decision, because i´ve spent a lot of time building my spreadsheet… it´s working fine, but i spend much time managing it, since there´s a lot of data there.
    Anyone had the same concerns? How was the migration process?

    • Anthony

      You should just switch over to PipeDrive right away. Migration will be smooth but more importantly you will once again fall in love with the sales process.

  • Felipe Grau Zabala

    Timo, great article thx for sharing it. During this year I’ve been incentivating my sales people to strickly reduce the OPEN DEALS, because they have too many of them. They continually argue me “I have too much work because I’m opening too much prospects, and actually not wining deals !”. I urge them to focus only in winnable deals, incouraging them to mark LOST inmediately after a “interested product, but we need to think about buying it” sales meeting. It’s very difficult for them (scary) to press the red bottom at the early stages at PD, because the feel like “I’m loosing money I can maybe win” and also they feel they are bad sellers and that will disapoint me. The message I repeat to them is “a polite and fast GOOB BYE to the customers and an after red button pressing is the best way to increase your total sales”. And that’s real because I’ve analized why they loose deals that are supposed to be almost in the pocket. The reason is that they have so many not really winnable open deals and activities (garbage) that the real winnable deals activities are “forgot to be done at time” which finally can lead to a unspected LOST.

    As a summary, I share this new slogan:
    “Don’t be afraid to press the red buttom in order to clean your focus and increase your total sales”

    • Hey Felipe, thank you! I think that incentive is quite a clever one :).

      I’m in your team – I once thought that selling was about influencing people to buy, and it was extremely difficult for me to erase my chances of influencing people. So, I kept them alive. Later on, I realized that this job is about searching and finding prospects who are experiencing the problem I was solving. Then, it became a lot easier to let go of opportunities with prospects who did not have the problem. It was still not dead simple, but at least I knew how to tell a good opportunity (experience of the problem I was solving, logical interest in solutions -> good use of time) from a bad one (no experience of the problem, lots of discussions trying to convince to see the value of the solution -> waste of time).

      I still think human beings influence each other, but my clear favorite approach has been search and find, and then present the solutions you believe would make a difference. However, I love to enter the prospect’s life before they’ve become acutely aware of their problem, and listed solutions on their own :). I found these early descriptions of problems very helpful for determining whether to move forward with a prospect, or cross them off, and move on to other opportunities.

  • Kern Dodds

    Great article!! and I love the comments also! We are new to Pipedrive and need to get over a couple of hurdles. 1.What is a good way to help sales people get over the shock of needing to mark “deals” lost. I dont want to tell them, “Suck it up buttercup”, but that is all that comes to mine when the whine about it. 2.Users dont want to create deals for everything. They don’t see a cold call it as a deal yet.

    • Change “Deals” to “Investments.” They’d have great difficulty arguing that they weren’t investing time/money in their list of Suspects. Change “Lost” to “Disinvested.” That’s what Timo was urging; you opt out because your investigation revealed that you’re not going to win. If you’re not going to win, you disinvest.

      • Kern Dodds

        Thanks for your response Mike! I don’t know if it is possible to change the names, but I will find out! 😉 I have been calling them “Opportunities”, but all they see is “DEAL”

  • Steven Bell

    Yes, this is gold. As a sales manager, the biggest issue I find, is educating new sals people to go for ‘no’. It is logic lost on most. We inherently love to win, however being able to sort through the chaff to get to the next prospect is also lost on many sales/director of sales as they simply feel that on call reports, it’s better to show some activity vs. good sales management. Thank you for this.

  • Well written. I’ve followed the strategy to clean the pipeline every month so as to focus on the hot prospects and it definitely works.