Few things hurt more in business than hearing prospective clients say they just bought from your competitor — except maybe hearing it over and over again. There are two ways to handle this: You can either make excuses, or you can take a hard look at where you dropped the ball to keep it from happening again.
If you stay professional, ask the right questions, and leave the prospect with some friendly advice, you can learn from rejection and use that information to bolster your sales strategy in the future.
How to Handle Losing to a Competitor
If you hear a prospect has already bought from your competitor, don’t walk away without gathering more information. Here are some steps for handling that letdown with grace, professionalism, and a proactive mentality to turn a “no” into a positive learning experience:
- Stay calm. Even if you’re dying inside, don’t slouch away in defeat just yet. There’s an opportunity here to find out exactly why you missed out on this prospect’s business.
- Stop. Is it really a done deal? Find out more about the agreement. Has the prospect only signed on for a trial period? Ask what he’ll do if his objectives aren’t met. There may be a chance to salvage the opportunity.
- Ask the right questions. To improve your marketing and closing game, you need to know what went wrong. Use this time to learn why a prospect bought from another company, how much he spent, what the competition did to win his business, and which companies he looked at before making a final decision.
- Share some best practices. You never want to go negative and bash a prospect’s decision. Be respectful, and offer some insights or best practices as friendly advice. Maintaining a relationship with the prospect could help him remember your company in the future.
Playing House or Playing for Keeps?
If you’re consistently hearing “We just bought from your competitor,” it’s time for some introspection. Potential isn’t enough; results are what define a company. Anything else is like playing house — everybody’s busy and smiling, but nobody eats.
If you believe your company has what it takes but is struggling to close deals, there are a few questions to get your sales team back on track:
- Why are participation rates so low? Gather your marketing http://www.icoiimplants.org/online/ and sales teams for some real talk, and flesh out where you’re falling short between potential and execution. Your participation rates might be high in your target accounts, but low in a general market sense. It’s important to find out why you aren’t appealing to these prospects.
- What’s the competition doing to get traction? Consider where your company is gaining traction that your competitors are not. You might be able to leverage a unique advantage in those markets.
- How does our marketing/spending compare to theirs? If your competitor’s marketing budget is three times what you’ve allotted, that’s probably a good indicator of why they’re ahead. Reevaluate your budget and look for ways to fund new initiatives, or get creative in your strategies to compete more effectively.
The same goes for the size of your team. If your main competitor has a marketing team of 50 and you’ve only got 10 salespeople, you’ll have a hard time giving them a run for their money. It may be time to pony up and expand your team or marketing budget to close the gap.
- Why aren’t we being considered? There’s a reason customers aren’t reaching out to you. Whether it’s ineffective marketing, a flawed product, or a lack of visibility, once you pinpoint the problem, you can make changes.
What Doing It Right Looks Like
Sometimes, it takes reconsidering your messaging to address the real fears of potential clients. Liazon, a private benefits exchange company, invested millions in its private healthcare exchange platform, but still found it hard to gain traction with decision makers when it launched.
While its solution addressed real problems businesses faced with benefits, the market was crowded and companies were loyal to their current providers. Liazon formulated a new marketing strategy: Get business leaders and HR directors to talk about the business problems, not the broker. The broker’s probably a nice person who understands leaders’ pain, but he hasn’t been able to fix their problem.
Liazon didn’t just show up and demo its technology — it encouraged prospects to consider whether the outcomes they were currently experiencing were meeting their expectations. This change in approach helped Liazon position itself to form solid business relationships; the company added more than 2,500 customers in less than two years and landed on the Inc. 500. It was later acquired by a publicly traded company.
If Liazon had sat on the sidelines, waiting to be “perfect,” it never would have been able to take advantage of its firsthand experience and fine-tune its approach.
Losing business to a competitor once or twice isn’t the end of the world. In fact, you can use a loss as an opportunity to gather intel on the competition and improve your sales strategy. But if you’re consistently losing out to competitors, you need to ask yourself hard questions to make serious changes and start turning the tables in your favor.