The most mind boggling statistic in the sales industry has to be that 50% of sales reps are not making quota. With all the Sales 2.0 tools available and ease of finding info on the web the sales industry is still struggling to hit its goals. I want to know why. So I asked Trish Bertuzzi the founder and President of the Bridge Group and inside sales bona fide expert to give us the skinny on some troubling data.
9 Reasons Why 50% of Sales Reps are Missing Quota:
1.) We are lazy and our hiring decisions are based on gut as opposed to repeatable success
2.) We don’t invest in an effective on boarding process….we let reps sink or swim
3.) Reps don’t know who to call or what to say when they connect
4.) When they do connect they show up and throw up and it is all about them instead of the buyer
5.) Marketing develops content to fill the top of the funnel but neglects the content that would help sales move the process forward
6.) Reps think inbound marketing means “they will call me if they want something”
7.) We have no idea how to ask for referrals or mine our own customer base
8.) Sales management does not know the difference between urgent and important
9.) Quotas are top down and based on something the board hands down after they passed the peace pipe
These are some darn good reasons why so many reps are missing quota, but I also want to hear from you. Why do you think 50% of sales reps are missing quota? Is the stink on management, sales reps, or a bit of both? Please share your thoughts.
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I think you've hit the nail on the head, Chad. There isn't one reason for the problem but, as you point out, many reasons. Having made that observation, I believe that it's management's mess to clean up. Sometimes that may mean cleaning house at both the management and sales levels. Get some people who know what needs to be done and who have the ability to get it done.
When 50% of reps are missing their quotas, I think two things:
1. Does the sales person stink? and/or
2. Are the quotas reasonable?
Kristen, who posted a comment just in front of this one, is right
about both her comments, but the second one is most relevant:
"Quotas" are a joke, no matter who sets them. I do believe that
management should set a goal based on historical sales
production in a given territory, but aside from that, all the factors
could be different.
Different salesperson
Different economy
Different prospect companies
Different competition in region
Different product/service
Sales managers are frequently those people who were
promoted from being the best salesperson. If they expect
all the salespeople to perform at their level, they are
smoking something.
Great post Chad and Trish. I think the commenters above me have all added some great insight, too. The one that resonated most with me was the first one, "We are lazy and our hiring decisions are based on gut as opposed to repeatable success." I think I'd go on to add that not only are the hiring decision lazy, but the firing ones seem to be, too. I've seen countless numbers of inside folks stick around WAY longer than they should have, simply because replacing them was going to take too long. Or because they fit the culture. Or because they were really nice. Or because (you fill in the blank).
Kristen is spot on, though. If your reps are only hitting 50% of their goal, either they're the problem or the quota is the problem. Wait, though – could it be that the PRODUCT is the problem? The SERVICE? I think we need to add that into the mix, too, don't you think?
Yes, Chris one aspect of this doozie of a question falls onto how good the product or service is. But in most markets, the differentiation between products is minimal, and most are good enough to get the job done just fine. Even in the companies that have a wiz bang product or service there are reps that are not making the number… why? This questions fascinates me….
Keep the comments flowing… I will crowdsource all the answers to this question in an upcoming post!
No one group or factor is fully responsible. Chris Snell made a good point that sometimes it's the offering or something outside of the sales rep's control though the very top performers will find a way to hit their number regardless. I'll add these items to the discussion:
1. Waiting for the marketing silver bullet.
- expecting the key competitive differentiation that will make the prospect fall on their knees and demand the product immediately
- wanting the sweet spot precisely and boldly defined (good practice, we all should know it, however there are stages of market development and industries where this is not cast in stone and it takes some hunting and creativity- this is also related to hiring — hiring the right rep for the right situation)
- waiting for ads on every street corner, web site, and billboard
The top performers I've observed more often drive their own lead generation, differentiation statementsunique differentiation statements
2. Selling the how (technology, methodology, product) rather than the outcomes
Great topic.. I would group the causes for lack of quota achievement into 3 buckets:
1)The quotas: Were not set accurately or appropriately. Could be a top down issue- could be set with poor data, staff members who calculate them could make errors etc….
2)The people (sales staff): Don’t have the right skills, right approach, right leadership
3) The product: Poor quality, lack of value prop, not priced correctly
Before reacting to lack of quota achievement, it’s important to understand the root cause(s) first, to then take the appropriate actions for resolution.
Happy selling!
Marci Reynolds
The Sales Operations Blog
8.) Sales management does not know the difference between urgent and important
This is HUGE. Sales managers, experienced and non-experienced, have a hard time understanding urgent and important- they are two completely different mind-sets. I am not manager, and will never want to be one so I can understand their struggle. However, I think this comes down to timing. At the end of the month/quarter/year managers think everything is Urgent and Important at the same time and miss two things:
1) There is a next month, bucko- prepare yourself
2) Understand who is asking for help and understand your employees
I'll elaborate on #2 from my experiences- A self sufficient sales rep that generally does not need a lot of hand holding and is consistent needs to take priority over the "Sales Rep That always Cries Wolf". Missed opportunities can fall through the cracks when not prioritizing urgent and important.
The take-a-way should be: understand your employees, opportunities, and timing. All should be considered when determining what is urgent and what is important.
1.) We are lazy and our hiring decisions are based on gut as opposed to repeatable success
I would say this also goes with Sales People being generally lazy in their prospecting efforts. Building a pipeline so that when months/quarters/years end, they can show qualified activity.
3.) Reps don’t know who to call or what to say when they connect.
This comes down to the not pepared fly by the seat of the pants nature of some Sales Reps. Never confuse hard work with efficiency. I can rememeber when I first started I was so eager to show my manager how many hospitals I visited or called on, but often didn't do research prior so that I could build instant rapport.
7.) We have no idea how to ask for referrals or mine our own customer base
Referrals are the lifeline. Many Reps do not ask because simply because they don't know how. However, if great rapport was built with the sales relationship where they understand it was a win win situation, referrals are easy to obtain.
I'd be more interested in hearing the 9 reasons why 50% of sales reps are hitting quota.
Could it be we have too much focus on quantitative assessment of the sales process but virtally no qualitative assessment?
How can a rep tell how well they are selling within a specific opportunity? How can a mangement team make this assessment so they know how to coach and support reps? What qualitative assessments are applied to leads and opportunties in the pipeline.
If we don't have a way to measure quality of selling is it any wonder we don't achieve the deisred levels of outcome?
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I dont agree with this completely but it brings up some great points.
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