When you lose a deal, what reason do you write down? If it’s price, you’re probably wrong. I always tell clients to sit down with their salesperson and ask why the last two deals were lost, and which objections they couldn’t get past. Angelo Ponzi goes a lot further than that, and he’s heard the price excuse for 30 years. He’s a fractional chief marketing officer and founder of Craft Marketing and Branding, and research is most of what he does before he touches a marketing plan. He walked me through how he does it on the Unscripted SEO Podcast. You can watch the full episode here or listen on Castos.
Price is the easy answer
Angelo’s test is one question. If the prospect loved your proposal, your approach and your thinking, why didn’t they come back and ask to renegotiate?
“But price is the easy answer. I’ve heard it for 30 plus years.”
He’s had it happen to him: the proposal, the work, and then “you were just a little more expensive than everybody else.” Maybe you misread the assignment. Maybe the RFP response missed what they wanted. Maybe they just didn’t like you. It doesn’t matter which, as long as you find out. Agencies that keep writing “price” in the CRM keep fixing the wrong thing, and clients usually leave agencies for reasons other than pricing too.
Talk to three groups, not one
My salesperson trick is one path. Angelo’s is all of them at once:
- Existing customers, to find out why you won.
- Lost customers and deals you didn’t win, to find the real reason behind “price.”
- Prospects, to hear what the market wants before you build it.
Then he looks for the threads that repeat. If every answer is different, that tells a story too, but it’s rarely the case. If the client has distributors, he talks to them as well.
The reason you have to go outside is a line he uses on executives, and it gets their eyebrows up: he doesn’t care what they say. How many of your own products are you going to buy this year? None. So he needs the people who actually buy. On an enterprise supply chain software project, the team had 25 features on the list for a new mid-market version. Customers narrowed it to six, plus a seventh on the cusp. You can ship seven in six months, or all 25 in five years.
Your salespeople aren’t a neutral source
Here’s where Angelo pushed back on my approach a little. Salespeople are worth asking, but their story about a lost deal tends to be biased.
“because ultimately when they’re telling why they didn’t win that client, you know, it’s never their fault.”
So he balances it with the internal survey work. He uses an assessment tool that every level of the company fills out, and then compares the answers. The gaps are the finding. His favorite story: a CEO and his VP of sales scored the same onboarding question a one and a five. They’d worked together for 26 years.
“gentlemen, I said, the fact you guys have worked together for 26 years and you’re even asking this question is more important to me than the fact that you don’t agree.”
If senior management isn’t aligned at the start, Angelo says, they won’t be aligned at the end. You can’t market your way past that.
A reason to believe isn’t a reason to buy
The research earns its keep when it changes the message. Angelo worked with a Christmas decorations company that had marketed weatherproof quality for 20-plus years. It was a true claim, and it worked well enough. But after talking to the people who buy for malls and sporting venues, the pitch became the memories those decorations create: families coming back, taking selfies, returning next year.
“That’s a reason to believe, not a reason to buy.”
Look at your own homepage and ask which one it’s selling. Quality, speed and experience are reasons to believe. The reason to buy is whatever the customer gets to feel or do afterward.
Start with your own data
Before any of the interviews, Angelo spends weeks inside the client’s numbers. One client had won 30% of its proposals for 25 years. That’s a fine close rate, so the real question was whether they wanted 30% of thousand-dollar proposals or 30% of half-million-dollar ones. Another spent evenly across five vertical markets, and two of the five, 40% of the budget, had never brought in business.
That’s the same job I’d want you to do before buying another tool or another campaign. Pull your lost deals for the last year, call three of them, and ask the question Angelo asks: if you liked us, why didn’t you come back? You can hear the rest of his process in the full episode.