What’s your close rate? For example, if you sent 20 quotes this month, and 4 of those prospects converted, your close rate is 20%. Of course, these ratios vary widely by industry. For instance, biotech has an average of 15% while software closes at a rate of 22%. The finance industry has 19% which reflects a cross-industry average. All this data is courtesy of HubSpot which claims that close rates show a positive shift for 2023. Interestingly, HubSpot’s recent survey of 1,000 sales professionals revealed that 35% of respondents reported an increase in close rate. 53% said theirs was stagnant, while only 12% cited a decline. Obviously, you’re more likely to close a deal if you identify the factors that affect your close rate.
You need high-quality leads to close a deal
We’ve all suffered with lousy leads. We might follow a hunch or fail to ask the right questions, and this negatively affects our close rate. A prospect without budget, interest or priorities is just a waste of time. So, this begs another question: “How’s your alignment between marketing and sales?” Depending on the size of your company, you lean heavily on the marketing department to provide high-quality leads. HubSpot’s survey showed that 40.4% of respondents saw improved alignment in 2022. What’s more, 25.9% ranked this improved lead quality third behind increased revenue and improved customer service. Therefore, you’re more likely to close a deal when you and your marketing department are on the same page.
Close a deal with customer referrals
Two-thirds of the HubSpot study respondents cited customer referrals as the channel that produces the highest quality leads. Doubtless, there is great value in working your existing customer base for new business. Plus, SalesFuel Today offers many articles that establish how and why a referral framework can be your best shot at making quota. Leveraging your customer relations and those with strategic partners is a great way to lift your referrals. What’s more, you can share your referral goals with multiple departments within your company to help close a deal.
Focus on retention and upselling
Remember, not all new business has to come from new customers. In fact, it takes many times the resources to gain a new customer than it does to retain an existing one. That’s according to forbes.com which offers “14 Customer Retention Strategies That Work in 2023”. Coincidentally, if you feel like crunching more numbers, the article shows you how to calculate your customer retention rate (CRR). The article states that smaller businesses shoot for a CRR of at least 20%, while major companies expect to stay above 79%. Your results may vary. However, if you care to experiment, set a goal to increase your closing rate each month and your CRR within the calendar year. Those benchmarks will present a long-term strategy that challenges your spirit and assures greater success.
You need to know how to ask to close a deal
Finally, there remains the most difficult requirement of closing a deal — asking for the sale. Some sellers fear rejection. For others it may be reluctance to seem too aggressive. Regardless, suppliers are duty-bound to do the job they were hired to do. Colleen Francis offers help with six strategies to ask for the sale. In a concise manner she covers ways to overcome fear and build confidence. As a professional sales coach, she emphasizes the need to practice, the importance of preparation and encourages roleplaying. Also, she teaches the value of no and to welcome the unexpected. Of course, all these realizations help to build credibility and character while preparing you to close a deal in less time and without the fear of no.
Photo by Karolina Grabowska on pexels.com