Being on a call with a prospect and realizing they’re not a good fit, won’t get much value from your product or service, and are unlikely to buy anything from you doesn’t feel great. For some, that not-so-great feeling might be disappointment, others might experience irritation, and a third group, those who have been in the sales game for a while, might feel a wave of apathy wash over them.
All in all, these are not ideal feelings to feel. If the struggle of a prospect not being a good fit, if not the not-so-great feeling that follows, is something you recognize, then it might be nice to hear that you’re not alone. In fact, data from Sales Insights Lab suggest that 50% of initial sales prospects turn out not to be a good fit for what your business has to offer.
While that statistic might be somewhat reassuring, it is also a little worrying. In this article, we’ll explore why this statistic matters (spoiler: it means more wasted time), why such a large number of prospects turn out not to be a good fit, and present a potential solution to help you ensure that more of your initial sales prospects turn out to be a good fit.
So what if 50% of initial sales prospects turn out not to be a good fit?
If 50% of initial sales prospects turn out not to be a good fit, then it means that 50% do turn out to be a good fit, so what’s the problem?
Firstly, I'd be surprised if this were a genuine question—most would probably agree that a 50-50 situation isn’t ideal. But, on the other hand, it’s correct; it could be worse! Regardless, here are two reasons you don’t want such a large percentage of your initial sales prospects turning out not to be a good fit.
It costs you time (and time is money)
Not only is time a scarce resource, meaning you don’t have access to an unlimited amount of it, but you also don’t get a refund if you use it poorly. Every unit of time a sales rep spends chasing bad prospects will necessarily mean they have less time for nurturing promising prospects.
Considering that 53% of sales reps don’t hit quota (partly because they only spend 28% of their time selling), you don’t want your sales reps to be spending/wasting their already-limited selling time on bad-fit prospects.
It reduces morale (and morale is money?)
As mentioned in the introduction of this article, it doesn’t feel great for the sales rep to spend their time on prospects that won’t convert. Repeatedly hearing 'no' will demoralize even the most seasoned sales reps. That reason alone should be enough for you to want your sales reps to avoid bad-fit prospects.
Of course, lower morale amongst your sales reps can also lead to consequences for the business, with decreased productivity and higher turnover rates associated with lower morale. No bueno.
Why do so many prospects turn out not to be a good fit?
Now that we’ve established that 50% of your initial sales prospects turning out not to be a good fit is not a good thing for sales reps or business owners, we’ll jump into three reasons why it happens.
Incomplete Information
While assuming perfect information can be useful when designing economic models easier, we are all probably aware that we don’t have perfect information. If we did, we would probably be behaving differently.
And that is true for sales reps as well—they are acting based on incomplete information like the rest of us. The information they have access to might be outdated or insufficient to make an informed decision about a prospect’s fit for the product or service they are selling. This leads to them contacting prospects they later discover aren’t a good fit for their offering.
Poor Targeting
One of the biggest reasons is the lack of effective targeting. Without a clearly defined target group, sales reps are shooting in the dark. They will inevitably end up pitching to prospects with neither the need nor the interest in the product or service being offered, aka bad-fit prospects.
Here at Vainu, we often advocate for companies to find their Ideal Customer Profile (ICP). With an ICP at hand, sales reps will know what types of companies are the most likely to be interested in the product or service they’re selling—which, coincidentally, are also the companies that they should be targeting.
We created a simple guide for conducting an ICP analysis to help those of you who have yet to find their ICP and could use a hand in finding it.
High Volume, Low-Quality Approach
Some organizations adopt a “quantity over quality” mindset regarding sales, prioritizing growing their sales pipeline as much as possible. This means that sales reps are incentivized to contact as many prospects as they can—even if they later turn out not to be a good fit.
While this is a somewhat understandable approach—who doesn’t like big sales pipelines?—it doesn’t matter how big a sales pipeline is if it doesn’t result in actual sales. Ultimately, all this “spray and pray” approach will lead to is a bunch of poorly qualified leads that’ll waste time and resources, which isn’t worthwhile.
How can you ensure more of your initial sales prospects are a good fit?
Now that we’ve covered why so many initial sales prospects turn out not to be a good fit, it would be a missed opportunity not to discuss a potential solution to this problem: A company data platform.
What Is a Company Data Platform?
A company data platform is a specialized software tool designed to collect, analyze, and present data on companies. This platform aggregates data from multiple sources, including public records, social media, news articles, company websites, financial reports, and more, and makes them available under distinct company profiles.
Generally, a company data platform allows you to filter the companies displayed based on numerous parameters, such as where the company is located, how many employees it employs, and what industry it is in, and create target lists containing companies that meet that criteria.
If you're more into the audiovisual stuff than just the visual stuff, we've got a short(ish) promotional video that explains exactly what a company data platform is and what it can do for you 👇
How Can a Company Data Platform Help?
A company data platform provides sales reps and organizations with actionable and up-to-date company information, but how does that help sales reps?
More Information = Better Targeting
Maybe it's a little obvious, but it’s probably worth saying anyway: more information (generally) means better decisions.
A company data platform typically offers a wealth of information about companies, which can be helpful when conducting an ICP analysis (if you don’t know your most profitable target group) and helping sales reps make better-informed decisions about which companies to go after.
This solves two of the causes for so many initial sales prospects not being a good fit in one fell swoop, making it easier for sales reps to pre-qualify prospects and helping the company improve their targeting and find the right types of companies to contact.
A High Volume, High-Quality Approach
One of the nice things about using a company data platform is that you don’t have to sacrifice quantity for quality. Obviously, as mentioned above, with all the data it provides, a company data platform can help sales reps make better-informed decisions about which companies to target. But another thing it can do is find companies that you want to target at scale.
Basically, once you’ve found the characteristics that define your ICP—e.g., how many people they employ, where they’re located, what industry they’re in—you’re able to use the filters available on a company data platform to find all the companies in its database that match that criteria. And considering those databases usually contain a lot of companies (our Nordic databases contain around 5 million companies combined), you’re bound to find a lot of prospects to go after.
Want more of your initial sales prospects to be a good fit?
Whether a prospect is a good fit doesn’t have to be left up to chance. Using a company data platform gives you access to more information about companies, which you can use to find the types of companies you should be going after. So, if you want more of your initial sales prospects to be a good fit, sign up for a free trial.
