1. Probability Analysis: Will the Customer Buy Something?
Probability largely rests on the strategic importance of the initiative to the customer’s business. Never equate an RFP with a strategic initiative; the customer may just be fishing. Sometimes salespeople can get a sense of the relative strategic importance of the purchase from online research, annual reports, and what the customer organization and key stakeholders post on social media. Other times, salespeople will learn this information through dialogue with their key contact and other stakeholders.
Regardless of the source, salespeople should gather evidence of the initiative’s importance beyond one or two people’s opinions. Every sales professional has seen a customer with a “pet project” they’re personally passionate about—but one that goes nowhere.
Another key probability indicator is whether the customer organization has a level of urgency or a compelling event pushing them toward a buying decision. Little will get done without at least one of these—the opportunity will stall and the salesperson will invest a lot of time and energy that, ultimately, leads to no decision.
A resounding “Yes” to this question indicates that the opportunity might be well worth pursuing; it’s certainly worth assessing potential profitability and whether the customer will buy something.
If the answer to this question is closer to “No,” it’s time to rethink whether the deal is worth the time and resources required to pursue. While not a stop sign, a “No” can be a speed bump.
2. Value Analysis: Does This Opportunity Have Value for Me and My Company?
Value lies not only in the potential top-line revenue. It also lies in the cost of the opportunity. That includes the salesperson’s, sales executive’s, and support team’s time and expense before the sale—and ensuring the post-sale implementation budget delivers the required margin.
A “Yes” to this question ensures that the opportunity represents business that’s good for the customer and the selling organization. A “Yes” is required to pursue; a “No” indicates that the deal isn’t profitable enough to justify the pre- and post-sale cost.