Are Sales Cycles Lengthening?
In talking to a variety of vendors across the CTRM space and beyond, I am getting feedback that sales cycles appear to be lengthening. Wether it be a traditional RFP process or a POC approach, it would appear that buyers in many instances are taking more time to decide. The question is why? Are buyers more risk averse? Are they less certain of what they actually want? Or is it for some other reason. After all, vendors have expressed hope that sale cycle lengths might decline with a drift towards POC -type sales of SaaS software.
One vendor I spoke with suggested that it might be a case of “once bitten twice shy” stating that often times vendors sales people have oversold the software and its capabilities leaving buyers disappointed. However, taking a POC approach ought to help eliminate overselling or pre-selling of functions and features as the users can actually ‘play’ with the software prior to buying. This could be the reason at larger and public firms that have to se an open and traditional competitive bidding process however and there is no doubt that there has been over- and pre-selling by vendors in the space historically. ComTech surveys have often shown that buyers are satisfied with the software once installed and running (2022 Vendor Perception report – 73% cited satisfied or better) but around 1/3rd are often less than satisfied with what they implemented and this is quite a high number. The same report also showed that trust in large and well established vendors may have fallen as buying from a top vendor had fallen to almost last place on the buying criteria that we tested. I also suspect a generational factor maybe at play as well. There is an increasingly large body of evidence that millennials are far more risk averse than baby boomers or genXers in the area of making financial decisions and it is this generation that is now taking up many of the decision making roles within the corporate world. I have noted this myself albeit in a purely non-scientific way and I do feel that it could be a factor in these increasing sales cycles.
Perhaps this is an area that might benefit from some additional research as increasing sales cycle lengths run as counter intuitive to SaaS and use of the POC. What are your thoughts?
Meanwhile, how about giving us your opinions on the vendors in CTRM and what matters in terms of buying criteria – have your say.
