You’re probably familiar with losing deals because prospects simply don’t decide. It’s not just the sting of failing to close, though, but also missing the opportunity to highlight the true cost of inaction. By focusing on COI, or cost of inaction, instead of just ROI, or return on investment, you show what the prospect is missing out on by not making a decision. It’s a way to create urgency without applying the usual pressure, and it can help you move toward more meaningful conversations.
Jeremiah Rizzo contributed a piece to the Databox blog that explains a practical framework for uncovering your prospects’ true cost of inaction. We share his guidance in this issue of PromoPro Daily.
Start with the organization’s goals. Think big here. For example, is your prospect looking to enter a new market or launching a new product? Maybe they want to improve their customer experience or they’re launching a new website. Rizzo says it’s important to consider what the company wants to achieve at a macro level, adding that the cost of inaction is sometimes indirect. Instead, it’s about how current problems block bigger initiatives.
Understand current alternatives. What’s the status quo? Consider what tools and processes the prospect currently uses and who’s involved in the current solution. Rizzo recommends also considering what compromises the prospect may be making and what other resources they may need.
Understand the appeal. This can get tricky, Rizzo says. Instead of attacking the current solution, ask the prospect why someone might choose to solve the problem in this way. Most companies don’t make bad decisions on purpose. They simply use the information they have at the time and make decisions based on factors like past experiences and competing priorities.
Identify the hidden costs. What do you know that they don’t? What assumptions are they making that might be flawed? Not because they’re wrong, Rizzo says, but because the environment has changed, their business has scaled beyond the original solution or new options exist that weren’t available before.
Instead of focusing solely on ROI, encourage your prospects to consider COI. Paint a picture of the missed opportunities or stalled growth they face if they don’t take any action. When you implement the COI framework above, you can help guide your prospects to making the best decisions.
Compiled by Audrey Sellers
Source: Jeremiah Rizzo is a contributor to Databox, a data analytics platform that helps businesses centralize and analyze data to improve performance.
