To build a more sellable product, you need to know why prospective customers do or don’t purchase your product. What was their final decision? Why? Did they perceive any product gaps? What other factors influenced their decision? Which alternative solutions did they consider? If lost, how can you win their business in the future?
This type of calculation is called win-loss analysis.
Win-loss analysis is an increasingly popular practice for product-led organizations. It gives product leaders a reliable, ongoing view into what prospects think about (and care about) during the evaluation process.
What makes an effective win-loss program? Here are eight best practices for your product team to consider.
Acknowledge What’s at Stake
Knowing why you win and lose new sales opportunities is mission-critical for your business and the success of your product offering. Win-loss analysis is the only way to figure out what prospective buyers want — which may be very different from what your current customers want. Rigorous win-loss analysis will help you sharpen product strategy, prioritize your roadmap, align with sales leadership, and keep a pulse on key competitors. After a while, you’ll notice sales win rates improving and product revenue growth accelerating.
Secure Executive Sponsorship
Best-in-class programs are always cross-functional initiatives that have strong executive sponsorship. That’s because win-loss analysis will expose opportunities for improvement across your entire business. For example, your product may not be selling well due to broken sales processes, ineffective messaging, convoluted pricing, etc. When those issues arise, you’ll want executive involvement to help drive positive change org-wide.
Get Direct Feedback From Buyers (Via Interviews)
Some organizations make the mistake of basing their win-loss analysis on feedback from their sales team. Unfortunately, sales reps are usually wrong about why they win and lose deals. To get the richest and most accurate feedback, you should interview the decision-makers at won and lost accounts. Let them tell their own stories. And, if possible, leverage a neutral third party like Clozd to conduct the interviews for you. Doing so will help the interviewees be more candid and critical.
Prioritize Getting Started Over Being Perfect
Starting small is better than never starting at all. You can improve and expand your efforts over time as your program gains internal traction. Sanjay Puri, VP of product marketing at Avalara, advises: “Start the damn program. Doesn’t matter how big you make it. Start with a few interviews — two, five, ten, twenty per month — whatever number makes sense for your business and budget.”
Tag and Track Key Themes
If possible, record and transcribe each win-loss interview. Then tag key themes and the positive and negative factors that influenced the buyer’s decision. Themes may relate to specific product capabilities, ease of use, company reputation, the sales process, pricing, etc. Tag quotes that support each theme. Aggregate the themes and quotes over time to expose trends worth addressing.
Interpret the Results in Context
As you analyze the themes from across interviews, use the relevant account and opportunity data to explore the themes further. Pivot your themes based on product line, competitor, customer segment, region, deal size, etc. Look for differences in the feedback as you change your lens. For example, do the themes vary across different sales regions? Also, pay attention to your sample size and resist the urge to make big changes based on feedback from a single interview.
Share the Findings Widely
Companies that gain the most from win-loss analysis tend to share the interview transcripts widely across their organization. They develop and share summary reports that highlight key themes (positive and negative) from across interviews. Don’t be afraid of transparency, even though there will be critical feedback. As you roll out your program, make sure that executive stakeholders and functional heads, especially sales and marketing leaders, review the feedback regularly so that they are enabled to take action. If you aren’t sure how to synthesize and share the feedback effectively, providers like Clozd offer technology for that very purpose.
Calibrate and Expand the Program Over Time
The best win-loss programs are ongoing initiatives. That’s because the reasons why you win and lose constantly evolve. Hone the program as you gain more data. For example, continually refine your interview questions based on your experience. Also, you should plan to steadily expand your program over time to cover more deals/pipeline. You’ll find that executives and functional leaders who see the value of your initial efforts will likely contribute their own budget dollars to funding a broader program.
Ultimately, no one cares about your product’s success as much as you do. Investing in win-loss analysis will give you greater empathy for the wants and needs of your prospective customers and help you address the gaps that are preventing deals from closing. To learn even more, check out this definitive guide to win-loss analysis.