Win/loss analysis and optimisation: how to get it right

Understanding how and why your business is winning or losing customers is vital for ensuring long-term growth, building on success, and improving pain points to increase revenue and avoid customer churn.

What is win/loss analysis?

The definition of business win/loss analysis is the process of proactively understanding and influencing factors that contribute to your sales team’s ability to win new business opportunities.

It’s necessary for becoming more effective at winning customers and reducing the amount of customer churn. Without analysing the actions taken for success, further optimisation over time will be harder – and without analysis of why an account was lost or closed, the chances of winning the next pitch are reduced.

What is the purpose of win/loss analysis, and what are the benefits?

The purpose of win/loss analysis is to become more effective at winning new accounts by providing your sales reps with evolving information on why customers are willing to buy into your products and services. Additionally, it offers your team insights into why customers are not making a purchase and can help them to understand the broader health of the buyer relationship.

Rather than winning or losing being dependent on chance, your win/loss analyses will help you to develop a playbook with standardised approaches that have been successful, and recommendations for improvement based on past learnings. This can greatly help your sales and marketing teams to increase their wins.

Win/loss analysis and optimisation can also help you determine the perception of your brand product or service in the market and the particular aspects of your offering that appeals to potential clients over your competitors. Your sales team can become more efficient with a higher return on the time invested in the sales process.

Win/loss optimisation can also help you determine any problems, such as:

• Overly forceful sales and marketing methodology
• A marked difference between your perceived value of your products and services and the value given in the market
• Broader issues with the health of the buyer relationship
• A lack of fulfilment of customer needs by your solutions
• Not meeting the promises set by your marketing

It can also help your team to see the proactive actions that have led to success. Win/loss analysis can also help you to:

• Validate any presumptions your business has made about your offering
• Take advantage of your true position in the market and help you evaluate the competition more effectively
• Repeat actions that have prompted a positive response and improved the health of the buyer relationship
• Optimise marketing campaigns that were a success or near-success
• Reward specific team member actions that led to success

Win/loss methodology

It’s sensible to develop a regular win/loss program for analysing and optimising your success over time to ensure you’re able to take action where necessary to increase your win rate. 

Start with understanding the health of the client or prospect relationship

In the B2B world, many new business opportunities come from existing clients. Understanding the health of your relationship with that existing client is critical. You are ensuring that your deal strategy has the greatest chance of success, and that your win rate continues to lift.

Similarly, net new prospects may be willing to give you insights on their business needs and their perceptions of your brand, products and services if you engage them far enough in advance of an opportunity.

Seek opportunities for ongoing feedback throughout the deal cycle

Optimising your win loss performance is an active process that not only draws on insights about why a purchase decision was made at the end of the sales cycle. Not only that, it also seeks ongoing opportunities for feedback whilst the deal is still in process. How well did the discovery meeting go? How effective was the client presentation? What more is required to build the confidence of your buyer? Find opportunities to get this feedback directly from the prospect.

Evaluate your CRM data and conduct internal win/loss reviews

Win/loss analyses should then also take place after each success or failure in a wrap-up session, and be documented for future reference. This will help to ensure that decision drivers are identified and relevant parties notified, and the sales process can be optimised for better results in the future.

Sales and marketing data from your CRM will always be useful in conducting win/loss analysis, but forming a cohesive CX program will give you the full picture of customer experiences and market sentiment. Understanding what calls, emails, and other sales and marketing activity was conducted can help your team to evaluate why something worked or didn’t.

However, the reasons why an account was won or lost might not be captured accurately in your system. Purchasing decisions can often be complex, with multiple stakeholders, but this can often be oversimplified in the system. It’s best to host discussions with the sales members involved to help understand the drivers for purchase better.

It’s also key to understand the prospective customer’s details. Questions you might want to answer include:

• How did they encounter your business?
• What were the prospect’s demographics (title of contact, company size etc.)?
• What problem did you try to resolve with your offering?

Armed with these details, you can see if there are patterns in the wins and losses you’ve encountered. 

Post-decision interviews

Gathering, understanding, and acting on post-decision win/loss feedback is critical for determining why your customers chose to take your offer or leave the opportunity. These should be completed within a short period after the decision was made to get the most accurate understanding.

Be respectful of this additional time this requires from the buyer and use the most appropriate collection channel to minimise their effort while ensuring you get the insights required.

You may find that you have more success if the interview takes place in person via a guided interview that is delivered by a non-sales resource for impartial results. Conflict of interest should be minimised to encourage honesty – your prospects shouldn’t feel like you’re still trying to sell.

Useful data to try and gather includes:

• Why the prospect got in touch / how they encountered your business
• What needs they thought would be fulfilled by your products or services
• What was persuasive and what was off-putting in your sales and marketing process
• What the ultimate deciding factor was for choosing to work with you or not

How to calculate your win/loss ratio

To calculate your win/loss ratio, you will need to divide the number of won opportunities by the number of lost opportunities over a selected time period.

To calculate your win rate, you’ll need to divide the number of won opportunities by the number of total opportunities you had over a specific time period.

Both are useful for understanding how successful your sales efforts are for winning customers.

Win/loss reporting

Developing a regular win/loss analysis report is the best way to encapsulate all the analysis you’ve collated for ongoing action.

Set up regular reports and discussions

Gathering your analysis and the data for quarterly or more frequent reports can give you a good understanding of the key learnings to take into forthcoming sales cycles. Hosting discussions can help you to glean insights from the team and set actions for improvement in the future.

Use a metric-based scale and set clear intentions

Creating a metric-based scale to quantify success and failure can help you make your win/loss reports more effective and can simplify processes such as post-decision interviews.

For example, you could give won or lost customers a scale of 1-10 for their perception of your business’s products or services, sales cycle performance, and competitive advantage or disadvantage.

Using a metric-based scale can help your team to develop clear outcomes to aim for, and help you to set the intention for future pitches to customers. Though there’s a number value to achieve, the breakdown of the scale into a rating for services and actions means it’s easier to see what steps to take for success.

Examine your overall win rate and your win rate by business segment or industry vertical

Analysing your overall win rate is helpful for understanding where your successes lie in general. It helps you analyse the wider actions that led to customer wins and losses and captures the factors that can affect this rate. That way you can double down on what works, and fix what doesn’t.

If success is tied to a certain industry, the data can help you to extrapolate what’s working to other companies within the same vertical or to other segments that have similar needs.

Visualise your analysis and set actions

To help your sales, marketing, and wider teams to take actionable insights from your reports, visualise your data, and set concrete actions to be put in motion. Sharing your analysis in a way that all of your team can use in the long term will help your business to build a more effective win strategy.