What’s the Ideal Win Rate, and Does it Even Matter?
(by Bernie Doyle)
A sales leader recently asked me this, What is the ideal Win Close Rate for a B2B company? I couldn’t answer, for a couple of reasons.
It doesn’t matter.
Win Close Rate means different things depending on the equation used.
I never saw an isolated number have any meaning. The real answer is a calculus of the Win Close Rate. What I mean is, a singular Win Close Rate (whatever formula you use) is useless without comparison to other Win Close Rates of similar time periods. For example the Win Close Rate of 2019 vs the Win Close Rate of 2020, how much did it change and in what direction? We’ll call it the “Delta” of Win Close Rates. Another red herring with these aggravating sales metrics is the idea of an industry standard Win Close Rate. Everyone knows that in any industry there are a small number of firms who are simply killing it and making a lot of money and the rest are just a bunch of mediocre ‘also ran’ companies. So why take an average of a lot of mediocre companies combine it with the leaders and arrive at some useless number. It never made sense to me. Finally, time has proven that the leader will not always be the leader. The same logic about an industry Win Close Rate applies to your own organization, you have 20% top players and 80% of the other guys, why would you take both their W/C rates and mix them together, it just results in a murky number without meaning, and most importantly it isn’t actionable. So Win Close Rates don’t matter, what does matter is the change in them over a period of time (delta). Furthermore, this is truly only meaningful if it is applied to the individual sale person. The only real meaningful scope of Win Close Rate is at the individual level and the only way it becomes meaningful is if it is in comparison to another time period and a story can be extracted which is actionable. I’ve seen markets change causing Win Close Rates nose dive and then sales people get pissed on by management. This is why I think Close Rates and other numbers are dangerous, they give management a sense of false understanding. Numbers need to be carefully considered, correct stories need to be extracted and thoughtful actions need to be taken. This is a rare daisy chain of what are actually really simple concepts. I’m geeky, and I decided to deviate from the other salespeople in my office and I started to use 3D models in zoom presentations back in 2019. It was extra work, but I did it anyway because it made me feel like I had an edge. I didn’t really close more deals either. But then the pandemic hit, I didn’t change a thing in my selling process but all of a sudden I had a higher win rate. Here’s the take-away. The delta of two Win Close Rates tells a story, but that story still needs to be surmised to be of either of two meanings: the market has changed or the sales person has changed. Either or, both give you something to take action about. But think about it first.
Don’t get sucked into vanity numbers like Win Close Rates, just check in with your sales people and use the numbers to find out how you can help them be better. It’s the only way that numbers can help you in the end.
(Bernie Doyle is the Owner of Sales Nerds, and can be contacted via https://salesnerds.com/ )