“This all sounds very interesting. Can you send me a few references?” Words that every sales rep loves to hear. After all, people only ask for references when they are getting ready to buy, right?
Errr…maybe not. In a recent blog posting, we wrote about CRM data capture practices in which we encouraged sales ops leaders to fight the natural urge to request more fields of data than necessary to be captured by sales reps. As expected, a handful of clients requested feedback on which of their own fields could be jettisoned.
Since our models incorporate only those company-specific fields that show a correlation with the ultimate closing probability of their deals, we can certainly tell users which fields are not contributing to our opportunity predictions.
After discussing some counterintuitive results from one of our users who utilizes a check box system for reps to indicate when a prospect has requested references, we did a more formal examination.
We recently examined more than 2,000 opportunities in which a reference request was logged. In aggregate, we found reference requests in isolation to be a very weak indicator of the ultimate outcome – Close Win or Close Lose. There were, however, small pockets in the dataset (certain sales reps and certain teams) in which the reference request is a strong indicator of a likely win.
Absent any other information about the nature of these reference requests, we are left to conclude that at a very minimum a reference request alone should not leave a sales rep confident about a deal’s closing likelihood. If nothing else, it should compel sales reps to question the nature of the request:
Does the prospect really want more information? Or have buyers been conditioned to ask for references – regardless of their purchase intent.
Does the sales rep understand whether this is truly the final step in the evaluation process? It’s an easy question to ask. If there other impediments to moving forward, shouldn’t the sales rep address those before bothering his busy clients to help him make a sale?
Does the sales rep have a process to ensure that conversations actually take place? If he is going to go to the trouble of sending information, why not actually go one step further to ensure that those discussions after all take place? After all a happy and relevant client should be a very convincing source of information.
Does the sales rep have an established plan forward assuming positive discussions?
In coming weeks, we will survey our user base to see if there are companies who both track reference requests in their CRM systems and have processes in place to address these questions.