Selling software to tech companies. Selling workout videos online. Selling cookies at a fundraiser. What do these things all have in common (besides the word “selling”)?
They all follow the same basic sales cycle.
A sales cycle is the series of actions a salesperson or sales team needs to take in order to sell a product or service and achieve sales goals. It’s made up of seven stages.
- Find leads.
- Initiate contact.
- Qualify the lead.
- Present your offer.
- Overcome objections.
- Close the sale.
- Generate repeat sales + referrals.
In this article, we’re going to break down what happens in each of these sales cycle stages and what you need to do to successfully move from one stage of the sales pipeline to the next.
Stage 1: Find leads.
Of course, before you can sell something, your sales rep needs someone to sell to. The sales cycle begins with finding these potential customers—aka. prospecting for leads.
Before you can begin prospecting for leads, you need to have a defined target audience. Which demographic does your product or service best cater to?
To figure out your target audience, answer these questions:
- What problem does your product or service solve (and who has this problem)?
- Why should people choose your product over competitors’?
Once you know what kind of leads you’re aiming to reach, you can go forth and begin prospecting. There are different ways to do this. One way is to divide them into inbound and outbound prospecting.
Inbound prospecting - attract customers to you:
This is a modern lead generation method that lays out different types of content and incentives that attract potential customers to you.
- Lead capture form on your website (like an email newsletter sign-up box—here are other ways to get signups)
- Social media presence (like being active on LinkedIn)
- Content marketing (like having a blog on your website)
Shopify uses a blog to attract leads to their website by publishing content relevant to what their target audience would be searching for. (SEO game strong.)
Outbound prospecting - reaching out to customers:
This is the more outdated method of generating leads, which involves actively searching for people to sell to. (They should match your target audience.)
- Connect with potential clients on LinkedIn
- Reach out to people who have visited your website (you can use a tool like Leadfeeder to find out)
- Reach out to lead lists provided to you by third parties or other departments if you’re not prospecting them on your own
To move on to the next stage: Get the lead’s contact information.
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Stage 2: Initiate contact.
Once you’ve found a lead, it’s time to contact them. A lot of sales professionals start off with a cold call, but you could warm them up first by shooting them a friendly email introducing yourself and your company or connecting with them on social media. (LinkedIn and Facebook groups your target audience are a part of are a good place to start).
- Prefer to cold call? Read this.
- Want to warm them up first before jumping to a call? Read this.
Regardless of which initial contact method you choose, the goal is the same: get the lead to agree to a meeting to chat about how your product or service can help them solve a problem.
Pro-tip: Do your research on the lead first, so you actually know how it can solve their problem.
An example of a sales cadence
To move on to the next stage: Get the lead to agree to hop on a call where you can chat in more detail about your product.
Stage 3: Qualify the lead.
This is where you separate the leads from the prospects.
- Leads = people who are a good fit for your product, but might not be willing or able to purchase it.
- Prospects = people able to buy your product (they’re the decision-maker and have the budget required) and potentially willing to do so.
The purpose of qualifying your leads is so you don’t waste time and resources (like money) trying to sell to people who aren’t likely to buy.
To qualify a lead, find out the following during your first meeting or sales call:
- Does this person need your product?
- Can this person afford your product?
- Does this person have the authority to decide to buy your product?
If the answer to all of these questions is “yes,” congratulations. You’ve got yourself a qualified lead—a prospect.
If the answer to the first two questions is “yes,” but they don’t have the authority to make the purchase decision, there’s still hope. Ask the lead (politely) to hook you up with the decision-maker or include them in your meeting.
You can learn more about different ways to qualify your leads here.
To move on to the next stage: Confirm that the lead needs your product, can afford it, and has the buying power to purchase it.
Stage 4: Present your offer.
Now’s the big moment. It’s time to show your potential client or prospect what you’ve got to offer.
Tell the prospect how your product or service will help them solve their problems and achieve their goals. Explain how it’ll improve the way they’re currently operating and why your company is the best choice, over competitors.
Remember: you’re not only selling your product or service at this stage; you’re selling yourself too. Show them you’re someone worth trusting by:
- Knowing your stuff. Come prepared by thoroughly researching the prospect before the presentation, demonstrating you understand their problems and what their goals are, and having a rap sheet of customers who have benefited from your product.
- Being yourself. Be warm, friendly, and genuine—like you’re talking to a friend. This is, after all, the beginning of what will hopefully be a long-lasting business relationship between the two of you.
- Being mindful of presentation. Be on time, have an organized spiel ready, and dress the part—these little things can make a big impression.
To move on to the next stage: Educate the prospect on how your product or service will benefit them.
Stage 5: Overcome objections.
You’ve delivered your sales pitch, but the prospect’s not convinced quite yet.
Don’t be discouraged. The fact they’ve got objections means that they’re at least listening and are considering it. Plus, they’re clearly telling you why they wouldn’t purchase it.
So, make like a salesperson and overcome those objections.
Here are some examples of common objections and possible rebuttals you could give to overcome each of them:
1. Objection: “It’s too expensive.”
Rebuttal: “I understand why the cost is important to you—as it should be. However, if you think about the return-on-investment on this product (like X, Y, and Z), it’ll pay for itself in just X months. That’s way more value in return.”
Why it works: By clearly outlining the value they’ll be getting out of your product, you’ll be able to justify its price point.
Another way you could address this objection is by dividing the total cost by months or days to show how affordable it really is. For example, “$10 a day for 10 days” sounds cheaper than $100.
2. Objection: “I don’t want to be tied to a contract.”
Rebuttal: “I get that. We’ve actually got multiple payment options—if you’re not big on contracts or just want to try the product out first, I can get you started on a month-to-month plan. You can cancel anytime. How does that sound?”
Why it works: This example pretty much shuts down the objection, but it does something else too—it’s called an assumptive close. This means you’re presuming your rebuttal has addressed the prospect’s concern effectively enough that you can proceed to wrap things up now. Basically, it makes it as easy as possible for the prospect to say “yes.” (More on closing in the next stage.)
3. Objection: “I’ve had bad experiences with similar products in the past.”
Rebuttal: “I’m sorry to hear that. Do you mind if I ask, which company were you using before?”
Why it works: This is more of a “part 1” of a rebuttal. The second part of this rebuttal is called a probing question (it gets the prospect to provide more information). Depending on what the answer is, you can specifically tailor your response.
For example, if you’re selling cloud storage and the prospect replies saying they used OneDrive before, list off the ways your product is better. (Having competitive battlecards on hand help.)
Pro-tip: Download this sales battlecard template to create your own cards!
An example of a competitive battlecard from Klue
To move on to the next stage: Successfully address the prospect’s objections and convince them that your product is worth buying.
Stage 6: Close the sale.
This is the moment you’ve been working up to: it’s time to wrap up the deal.
To recap, up to this point you’ve:
- found potential customers,
- contacted them and figured out which of these people are most likely to buy from you,
- hit them with sales pitches, and
- while you lost a few over irrefutable objections, you won some of them over and
- now they’re ready to seal the deal.
There are two ways to approach closing the sale:
Use this method when you know a direct approach will work well (the prospect is eager to start using your product and you’ve developed a good relationship with them).
Example: “Alright, looks like we’re ready to roll. I’ll put the paperwork together and send it over for you to sign, then we’ll talk delivery dates. Sound good?”
This is a more passive method to closing, and should be used when a prospect still seems a bit tentative about their purchase decision, and might be put off by an approach that’s too pushy. In this case, it can help to reiterate the benefits your product has to offer them in order to reinforce their buying confidence during the close.
Example: “So, we went over how our product is going to do XYZ for your company. I’m going to put the paperwork together and send it over to you—take a look over it and let me know if you have any questions. Once you’ve confirmed everything looks good, we’ll be ready to roll.”
If you don’t close the sale on the first try…
Don’t give up. Some deals are harder to close than others—especially if you’re selling high-ticket or long-commitment items like machinery or services that are bound to a contract.
Remember: while the sales cycle is pretty much the same regardless of what you’re selling, the average sales cycle length can vary.
To move on to the next stage: Get signed paperwork from the prospect, officially converting a new lead or sales opportunity into a customer.
Stage 7: Generate repeat sales + referrals.
Too many sales reps make the mistake of stopping the sales cycle after stage 6. Once they close the sale, they move on and never look back at the customer they worked so hard to win.
Don’t do that.
Once a prospect becomes a customer, that isn’t code for “they’re the Customer Success team’s responsibility now.” This is an old-school mentality, and won’t set your company up for long-term success in today’s business world, where consumers care more than ever about relationships.
Instead, keep in touch with your customer and continue to nurture your relationship with them. Some ways to do this are:
- Send a follow-up email a month after you close the sale to check in and make sure they’re happy with their purchase.
- Check in every few months or so to see how they’re doing with the product or just to say hello.
- Send “happy birthday” and “happy (day-you-bought-our-product) anniversary” emails once a year.
By keeping in touch with your customers, you’ll be leaving a great lasting impression on them—and making sure they don’t forget you exist.
So, if they ever want to upgrade their product, they’ll reach out to you (hello, repeat sales). Similarly, if they know anyone who’s looking for a product like yours, guess who they’ll recommend? Yep, that’s right: you. Hello, referrals!
You could also generate referrals by simply asking for them.
For example, say your new customer replied back to your first follow-up email with raving reviews. Thank them and let them know you’re happy they’re getting the full benefit of the product, then ask if they know anyone else who could benefit from the service as well. (If they do, this is a reminder for them to send them along.)
You can learn more about getting referrals—including email examples—here.
An example of an email asking for a referral from Buffer
And then the sales cycle starts all over again.
No matter what you sell, every business goes through some shape or form of these seven stages of the sales cycle.
Take a look at your current sales process and match up the different stages to the ones we went over in this post. From there, see which stages you can make improvements on. You can learn more about optimizing your sales cycle here.