Managing Irregular Buyer Budgets in a Fluid Selling Environment

Early this month I touched on the irregularities organizations are navigating internally and externally in terms of hybrid virtual and in-person interactions. Now I want to shed some light on another anomaly as the result of this fluid selling environment: buyer budgets and prolonged sales cycles.

Personally I have never seen buyer budgets in this much disarray in the now 2.5 decades I have worked in this industry. When I speak with the Mereo team of principals, with clients and with friends in the industry, there is a consensus: Buyer budgets are out of whack.

So, what is going on — and, more importantly, what can your selling team do about it?

Making Sense of the Buyer Budget Disruption

When COVID-19 first hit the states, budgets and targets had already been set for the year. As buyers went quiet and tightened spending in response, though, suddenly the revenue numbers that had been set in pre- or early-2020 became inconceivable. Thus set off a domino effect of revenue instability and deal holds.

A number of months passed and, in many cases, budgets sat untouched. On top of that, the usual travel expenses accumulated with salespeople going remote and interacting with buyers virtually. Companies eventually experienced some Revenue Rebound as buyers began spending once again.

Although things did not go back fully to normal, and while there have been many remaining challenges like supply chain shortages and issues, they were looking more positive again for 2021.

Yet as 2021 has rolled around, many organizations that usually had methodical and cyclical budget planning approaches were sitting by quietly watching as a handful of macroeconomic situations arose around us. Those organizations who paused releasing of final budgets joined the ranks of organizations who finalize revenue and expense budgets after the new fiscal year begins. Further compounding matters, many figured out their budgets just before the summer months hit — and more employees than ever before took much-needed vacations. Sales deals continued to stall as members of the buyer committee with newly established budgets set off for a national park or beach week.

Sandler Research has found that while half of participants reported B2B purchase cycles remaining the same, more than 30% noted they were “longer” or “significantly longer.” Participants from larger organizations were 33% more likely to have experienced longer cycles as well.

The biggest takeaway? The majority of B2B sales cycles have bottled-necked — until this point.

Seek to Serve™ for the Sales Cycle Surge — and Possible Future Fall — Ahead

I said it before and I will say it again: Business leaders must acknowledge and accept that there are conditions out of their control, some that are in their control, and others yet that offer advantages and silver linings.

What is out of control? Your buyers’ budgets and buying cycles. The pandemic situation. A number of other macroeconomic situations yet unfolding. Stay aware and atop these, but do not spend all your energy worrying here. Where you can influence these, be proactive in doing so.

Rather focus on what is in your realm of control: when a qualified lead surfaces, be timely (and courteous) with a rapid response; engage buying committees on topics that matter to them (their situation and related challenges) BEFORE pitching your solution; and shape our sales conversation messaging to incorporate relevant and compelling differentiation, not just me-too jargon that you (and most of your competition) claims as differentiators. What is the common purpose about each of those? Seek to serve, not to sell™!

To strengthen your organization with a selling approach that supports sustainable revenue performance in uncertain times, future disruptions and otherwise, download the Seek to Serve, Not to Sell eBook.