None of us like to lose! As sellers, we expect tough competition and challenges, but we are driven to win. There’s a sense of well deserved pride to see a customer select us as the best of all the alternatives.
While a nuanced idea, sometimes, we may be less focused on winning, more focused on not losing. It seems our aversion to losing is, often, higher than our desire to win.
Sometimes this loss aversion is manifested by sellers not chasing the tough but winnable deals.
Sometimes, we see exactly the opposite, we see sellers chasing deals that aren’t winnable. We’ve analyzed thousands of wins/losses over they years. Something remarkable happens, the cycle for a loss is twice as long as the cycle to win. Sellers suffer from the sunk cost fallacy or wishful thinking and pursued deals that should have been abandoned much earlier.
Sometimes, our metrics drive behaviors that are counterproductive. Rather than declaring a loss, they just keep something in their pipeline, hoping to avoid uncomfortable questions. This has a triple adverse impact on performance. Win rates are artificially inflated, and pipeline metrics are distorted. Then there is the opportunity cost of “holding on,” sellers and the organization wasted time on deals that aren’t winnable, diverting time from those they can win.
Our loss aversion tends to drive other dysfunctional behaviors.
Sometimes we are driven to discount or concede things far too early. Rather than being confident in our ability to drive value and helping customers understand this, discount or concede things. While it represents a short term win, over time this may devalue our offerings or reputation in the market. These behaviors “train customers.” to seek discounts and concessions.
Or in a related way, we may tend to avoid challenging, but important conversations with our customers. Our fear of losing, causes us to avoid addressing important issues, or resetting customer expectations. But doing this is important in building trust and assuring we can deliver on the customer expectations.
Sometimes, we hang onto leads far too long. We aren’t getting the responses we need from our outreach, we worry about finding and qualifying a sufficient volume of leads, so we persist in wasting our time on leads that, when we assess them realistically, will never convert. This also amplifies the perception of “being busy, working hard,” rather than getting the help and coaching we need to find and pursue the right leads.
But this has another adverse impact. It keeps us from investing the time to figure out how to find and engage the right types of leads. We are so busy holding onto bad leads, we never figure out how to get the right ones.
Our commitment to “just good enough,” provides excuses to justify our losses, while we miss the opportunity to innovate and change. Regular readers know my ongoing rant against declining win rates and sales performance. But I encounter too many sellers saying, I’m achieving my goals, when in fact they are under performing their potential. My tired example still applies. If we are achieving our goals at 15-20% win rates, why do we never challenge ourselves with the question, “What would it take to achieve 30-40% win rates?” In addressing this question, in testing ideas; we face the potential of losing. But if we never take that risk, we never learn what we need to do to achieve our full potential.
Another way to look at this aversion to change, is best described by Matt Dixon and Ted McKenna in Jolt. As with our customers, FOFU impacts each of us. Our fear of F***ing up keeps us from experimenting and moving forward, so we never change.
No one likes losing. But it is through our losing we learn the much. This doesn’t mean we purposefully seek to lose, rather that we recognize losing is part of our growth and learning process.
And if we are going to lose, it’s far better to lose fast!
Afterword: Here is the AI generated discussion of this article. As usual, it offers some unique insights.
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