Anyone who has spent more than a week working in sales can probably quote Glengarry Glen Ross by heart. Coffee may “be for closers,” but there’s much more to it than that. Even before you get near the close, you have to make sure you’re devoting the proper amount of time and energy to the proper prospects, rather than wasting time on curious bystanders with whom you’ll never strike a deal.
So how do you quickly identify promising prospects? I asked two founders, Nina Sodhi of in-app ad network Blu Trumpet, and Irving Fain of customer relationship platform CrowdTwist, how they approached the challenge.
Ask the tough questions. Fain learned to ask one key question early on: “What is your budget for this project?” If a prospect hasn’t already thought about budget, he or she probably doesn’t view the project as a priority. Alternatively, “if someone’s budget is $5 and your product costs $500, no matter how much they love it; they’re never going to be able to afford it.”
Sodhi’s team at Blu Trumpet took a similar approach, asking prospects whether they already had an in-app monetization strategy. Rather than spend time evangelizing the basic idea of in-app advertising, Sodhi realized she could save a lot of time by focusing on prospects who were already using some form of in-app advertising, or were at least working on it. Then, in its pitch, Blu Trumpet could compare the quality of its network’s performance to an incumbent’s.
Use tools to track metrics and refine the pitch. The real value of CRM services such as Salesforce is that they can help improve the efficiency of your sales cycle, and in particular, to identify the profile of likely early clients. At first, Sodhi was using a Google Docs spreadsheet to track progress with prospects. It was messy, and didn’t yield much insight on the likelihood of closing an account.
Once she switched to Salesforce, she was able to segment her pipeline of prospects by size and category (sports, gaming, business, etc.) in order to figure out which represented Blu Trumpet’s ideal customer segment. Sodhi then concentrated on those segments that demonstrated the highest conversion rates.
Learn to say no graciously. After TechStars Demo Day, CrowdTwist was lucky enough to receive a deluge of interest from prospective clients. Fain wanted to talk to everybody. But after dozens of meetings, he realized that not all leads were created equal. “When you should take meetings, and how you prioritize them, depends on what you’re trying to accomplish at each stage,” says Fain. Fain recommends asking yourself what critical metrics will show that you’re meeting your next milestone. Your answer should influence both your target list of prospects and your strategy for pursuing them.
If a prospect won’t help you achieve your next milestone, Fain recommends telling them, “We’d love to work with you down the road, but right now our business focus isn’t aligned with what you need.”
SCHUYLER BROWN is the host of Founders@Fail. He currently works at High Peaks Venture Partners, where he sources and evaluates potential investments. Brown holds a B.A. from Columbia University and an M.B.A. from Columbia Business School.