Win/Loss Analysis Defined

(And How To Upgrade Your Approach)

Win/Loss Analysis is the process of identifying and understanding the issues that cause deals to be won or lost.

Most B2B technology companies collect data about their wins and losses in multiple ways.

    • CRM implementations almost always require a Closed/Lost reason code.
    • Sales teams use loss reviews to analyze and learn from critical losses.
    • Product marketing teams interview new customers and may attempt to interview buyers in lost deals, too.

These are three examples of lightweight approaches to Win/Loss Analysis that any B2B technology vendor can execute continuously.

While they’re not highly accurate, that’s not “a problem worth solving” as Anthony Iannarino would say.

Why Sales And Marketing Leaders Invest In Better Win/Loss Analysis

Of all the reasons for an upgraded win/loss program, the most compelling are the ones that show up in the numbers. Sales and marketing leaders describe these problems with words like, “early stage losses,” “no decisions,” ”below target,” and “not enough pipeline.”

Gartner has researched the impact of rigorous win/loss analysis, and even quantified it. Todd Berkowitz at Gartner summarized the benefit this way.

“Those that take a more comprehensive approach have seen a 15% to 30% increase in revenue and up to 50% improvement in win rates.”

Increased risk is another common reason for change. A repositioning project. A change in target market. “We want to go up-market but are we up-market ready?” The ramifications of using inaccurate buyer and competitor data to make strategic decisions like these are another common trigger for better Win/Loss Analysis.

If this is your situation, and you’re architecting an upgraded win/loss program, I recommend focusing on the accuracy and efficiency of your new program.

Get Accurate Insights (Not Just Accurate Data) From An Upgraded Win/Loss Analysis Program

Accuracy is the central reason teams invest in an upgraded win/loss program. They want more accurate, reliable insights into their wins and losses.

Buyer interviews usually top the list of options for collecting win/loss data, for good reason.

Buyer interviews are the gold standard for understanding why a deal was lost or won. Interviews provide primary data — direct from buyers — about their perceptions, preferences, and actions. And buyers will provide fuller, more candid answers in a live interview than they would or could in a survey.

But accurate data about each individual opportunity that’s been interviewed doesn’t necessarily lead to accurate insight about the overall patterns that are driving wins and losses across all your deals.

To generate accurate insights, your win/loss program must provide:

    1. a critical mass of fresh data when you need it
    2. a deep, thoughtful analysis of the mass of transcript text generated by the interviews.

#1. Accurate Insights Require A Critical Mass Of Fresh Data

For the first of these, the key parameter is timing. When will all the interviews be complete and available for analysis. And, how recently did those deals close. Technology markets change too fast to rely on data from deals that closed more than two quarters ago.

If you’re planning to use a Win/Loss Analysis service, it’s good to know how the clustered model differs from the subscription model. While the total number of interviews will be similar in both cases, the completion time differs.

Vendors using the clustered model will typically need 1-2 months to interview buyers and analyze the data from 20-30 opportunities. The subscription model spreads the interviews out. Twenty to forty interviews over 1-2 years is a common configuration. This “heartbeat” setup is well suited to the coaching needs of sales managers, where each individual interview is valuable. But for detecting overall patterns, it’s not a good fit. Analyzing a critical mass of 20-30 opportunities would require waiting 3 or 4 quarters. And then half the data is 3 or 4 quarters old.

Because it’s faster and more accurate, we recommend the clustered model. We use the clustered model in our own projects.

Finally, about those words “critical mass.” To decide how many interviews are needed—the sample size—I recommend using the binomial probability formula. Check my post “Sample Size For Win/Loss Analysis” for details.

#2. And Accurate Insights Require Thoughtful Analysis

Accurate insights also require a thoughtful analysis of the mass of data produced by the interviews. This analysis and its presentation are the outputs your stakeholders will consume; very few of them will ever look at the raw interview data.

For in-house programs, this time-consuming effort is a common shortcoming. Consider the time and effort required to make sense of 20 or 30 buyer interviews, each yielding a 10+ page transcript. I recommend you allocate to analysis and reporting one-third of the total time you’ll spend working on the project. That may sound like a lot of time, but there’s no downside to allocating this time in your plan for analysis, and then delivering early if you’re faster. This is especially true when it’s the first time you’ve done a detailed Win/Loss Analysis.

Analytical skills should also be a key criterion when selecting a win/loss consultant. Look at sample reports. Will the templates you see provide the insight you need, and if not, how much customization does the vendor provide. Does the provider’s team have the experience and skill to provide the analysis and recommendations your team expects.

Efficiency Matters, Too. Because Win/Loss Analysis Isn’t One And Done

Pay attention to efficiency when you’re architecting an enhanced win/loss program. There’s a subtlety to accuracy which makes efficiency extra important.

To achieve absolute accuracy, you’d need to interview every single opportunity after it closes. But that isn’t sustainable.

Yet, you do need to continue gathering up-to-date data, because accuracy deteriorates. You’re iterating your product, marketing, and sales process. And your buyers and competitors continue changing.

Plus, as these changes are made, you really should benchmark them with new buyers to find out if they perceive the changes. And if they do, to find out whether the changes are perceived as better or worse than the status quo.

So Win/Loss Analysis isn’t one and done. Your program needs to be continuous, but not necessarily efficient.

This is a decision point.

Your win/loss program could continue interviewing a small number of buyers each quarter, say 5 or 10.

Or your program could go wide during this continuous phase, aiming to get feedback from as many buyers as possible.

I believe it’s better to go wide at this point. To benchmark the changes you’ve made with as many buyers as possible. To track the trends with as many data points as possible. How is competitive win rate changing? How are buyer decision criteria shifting? And how is their assessment of you and your competitors on those criteria evolving?

Buyer surveys are one way to efficiently gather this data from a lot of buyers. The marginal cost is very low, so you can potentially gather data about every single opportunity that closes. And then follow up with an interview when you see responses from a buyer that you want to understand better.

This is the method we use at Growth Velocity. But, there are other options. Check our review of the pros and cons of using CRM reason codes, Sales team surveys, Buyer surveys, and Buyer interviews for Win/Loss Analysis.

The bottom line is to make sure your win/loss design supports continuous data collection so you can benchmark your improvements and be the first to know how buyers and competitors are evolving.

Upgraded Win/Loss Analysis Is A Competitive Advantage

A well-designed upgrade to your win/loss program will produce both accurate data and accurate insight about the issues that cause deals to be won or lost. This is a competitive advantage for the companies that upgrade from lightweight approaches.

As Todd Berkowitz at Gartner has observed, lightweight approaches to Win/Loss Analysis put you at a competitive disadvantage:

“While the vast majority of Gartner clients (and likely non-Gartner clients) do some form of win/loss analysis, only a minority (likely 35-40%) conduct it in a comprehensive, rigorous and thoughtful manner. […]

While ad-hoc reviews about key losses can help identify obvious problems, providers that only utilize that strategy are putting themselves at a competitive disadvantage.”

And on a personal level, there’s the benefit of pride for the leaders in sales and marketing that sponsor the work. We’ve found that a well-executed upgrade to a win/loss program yields a go-to resource they want everyone to see.

 

Related Resources

Selecting A Win/Loss Analysis Consultant? Here Are 5 Tips

Selecting a Win/Loss Analysis consultant is an important decision. Here are 5 tips that will help you make a good choice.

How To Conduct A Win/Loss Analysis

The seven steps described here have been proven through years of in-the-trenches experience.

Guide To Choosing The Best Data Sources For Your Win/Loss Analysis

Pros and cons of four common data sources for Win/Loss Analysis: CRM Reason Codes, Sales Team Surveys, Buyer Surveys, and Buyer Interviews.