The higher the risk, the longer the sales cycle…
For low risk, inexpensive purchases like a candy bar, buyers whip through all nine steps in a matter of seconds. When it comes to major purchases, the buying process often takes months and sometimes years. For example, think back to the time it took your own business to decide to put up—or even redo—your website…
Let’s walk through the buying process to begin to understand some of the circumstances that cause sales cycles to stretch out, beginning with the first row of the chart (although in practice the second or third row may happen first).
Only those that have a need will purchase
The first box is labeled HAVE NEED. That’s because no one will buy from you unless they need what you have to offer. Nevertheless, most businesses waste resources promoting solutions to unqualified prospects–those that don’t need what they have to offer and therefore will never buy. For example, my small business sometimes gets sales calls from companies that sell products and services that only make sense for much larger companies.
But first they must recognize that the need exists
The next box is labeled RECOGNIZE NEED. How many of you know of companies that would be much better off if they purchased from you—but they’re continuing to do business in the same way they’ve always done? Chances are if they stopped to consider the real costs of inertia, they’d behave differently–but in the meantime sales cycles stretch out.
Take for example, some of the taxpayers that use the post office to submit their taxes. Many are aware that they qualify for free filing and have computers—but they continue to post their returns via US mail.
Although some subset of these individuals has well thought out concerns about filing over the Internet, most have just never stopped to really examine the pros and cons. In fact, they probably would have filed their returns electronically if they had only learned of the option when they were less busy—or realized in advance just how long they would have to wait in line on April 15 to obtain proof that they had mailed their documents in on time. Nevertheless, they didn’t; so the IRS will have to wait at least another year to consummate the sale.
Then, it generally takes a sense of urgency to generate demand
The third box is labeled READY TO BUY. Many buyers not only need a particular solution; they are aware that they should take action. Nevertheless, they delay buying because the urgent takes precedence over the important. In fact, it’s not uncommon for other initiatives to continue to take priority until the need becomes truly pressing.
To sum up, getting the sale depends on finding prospective buyer that need what you have to offer. Nevertheless, need is a necessary but not sufficient condition. Prospective buyers must realize what they’re missing by delaying a purchase and develop a sense of urgency about filling the gap.
Next week, we’ll proceed to row two of the buying process chart and discuss three more factors that can cause sales cycles to stretch out.