Why making sales decisions with your gut is a bad idea

Paul Black discusses why relying on your instinct in sales can set you up for a fall.

Being a great salesperson requires something special, and not everyone has what it takes. To be successful, they must be confident and they must possess ample powers of persuasion. Some believe sales even requires a sixth sense to both determine how customers are currently feeling and to predict what they’ll do next.

But in the data and information driven age we live in, even the worst salesperson can become good, and the great can become the best. That’s because they no longer have to make key decisions based on gut feeling alone: they have the tools at their disposable to make informed choices.

However, a recent study by sales-i has shown that a surprising, and not insignificant, 6 per cent of sales professionals choose not to, and still make decisions based mainly on their instincts. This is seldom the best route to take when navigating critical business opportunities, and here are a few reasons why.

Following your gut

While instinct, perceived as a natural feeling upon which to think or act in response to particular circumstances, is important in pressing sales situations, it’s dangerous to act on a gut feeling without testing it against fact.

To do so is to make a choice without fully considering its long-term implications. Crucial factors like customer buying patterns are discounted simply because it never occurred to the salesperson to take them into account.

Natural bias and subjectivity can also put sales professionals on the wrong path. Their personal perception of a specific customer or product can unduly influence their decision, and cause them to ignore valuable clients or undersell useful products.

Simply put, a gut feeling can also be completely wrong. Instinct is not quantifiable; to act on it exclusively is a gamble, and gambling with revenues, careers, and income is never a good idea. Something that seems like a good idea at the time may be regrettable a month or two down the line, like the impulse purchase that ends up lying in a cupboard unused because it was never suitable in the first place.

When decisions are based on nothing more than momentary positive bias, salespeople will often have no idea how they are actually going to turn out.

A better way of doing business

Another example of salespeople relying perhaps too heavily on their intuition is customer relationships. Two fifths (40 per cent) of respondents say that they make decisions based on the dealings they’ve had with their customers in the past.

The value of solid rapport can never be understated, but it’s important to understand that a salesperson needs more than a winning personality to deliver big results. If data is not being collected and measured during interactions, a ‘good relationship’ is not an indicator of anything other than how well a sales professional gets on with a particular customer. And when great relationships are forged with certain clients, it’s usually at the expense of other ones.

So while maintaining good rapport will always be important, sales professionals’ decision-making process should not start and end there. Of course, many of these professionals already know this.

This is evident from the 13.8 per cent of survey respondents who said that they manually sort through data to find the information they need for their decision-making. This might not be the most efficient way of doing things, but it is definitely a step in the right direction.

However, the 39.9 per cent who replied that they use technology for data analysis and decision-making have truly hit the sweet spot: the advantages of this approach are simply too good to ignore.

Use data to your advantage

To make decisions that will be beneficial in the longer term salespeople need to combine their customer knowledge, understanding and rapport with qualitative data analysis.

They can use analytics tools to identify customer buying patterns and trends and to make their sales efforts more targeted.

Data doesn’t lie, and if used correctly it can help anticipate when a customer is likely to place an order which will, in turn, enable them to make the right offers to clinch a deal before any of their competitors.

Data analysis can also warn them when a customer is dropping in sales, so that they can save the relationship before it’s too late. Additionally, the historic data will shed light on customer preferences, telling sales professionals exactly how to contact a specific individual (whether by telephone, email, or in person) for the best possible outcome.

The right technology will let salespeople know what people want, before they even know they want it. With no need to speculate or guess, they have all the information they need to make rewarding decisions.

Sales professionals who live in the past will get left behind. They no longer have to guess or gamble when making key decisions: to do so is a choice in itself, and, with the software at their disposal, increasingly the wrong one. The right data management tools can ground this process in fact. Charm and confidence are not traits that can be taught, but in their absence, customers still find it refreshing to talk to a salesperson who understands their needs and concerns.

Paul Black is CEO of sales-i.

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