Episode 90: A Single Shot of Bourbon
What do we do when we lose deals?
Summary
Nick and Kai walk through what they each do after a proposal gets turned down. Kai’s process runs from recording prospect calls to logging rejection reasons in a CRM and reviewing them in aggregate; Nick’s is lighter on follow-up sequences and heavier on staying visible in person and updating his process after each loss.
Highlights
- Kai records every prospect call so when a deal falls through, he can go back and compare what the prospect said their problem was versus what the proposal actually addressed. A recent loss showed him he had never restated the client’s problem in the document itself.
- Nick ran 40-plus follow-up emails with some lost prospects and says none of them ever converted. He concluded he was just annoying people and stopped.
- Nick flew to New York and met with several old clients with no sales agenda, no pitch, just to remind them he exists. He says staying publicly visible about his work and values has done more to reactivate cold leads than any email sequence.
- Kai’s post-rejection process has four steps: analyze what went well and what didn’t, uncover the real objection (not just what the prospect said), maintain the relationship with the person rather than the company, and ask for a referral. On the referral ask: it costs almost nothing and he does it as standard procedure.
- Kai logs every lost deal in Pipedrive with notes on why it didn’t close, then reviews them quarterly in aggregate. If 60% of losses trace back to budget, that points to a broken pre-qualification step, not a broken proposal.
- Nick updates his Draft Revise application process every time something goes wrong, even small things like adding a question or rephrasing a line. His rule: never make the same mistake twice, keep making different ones.
- Kai’s welcome packet hack: put the call booking link on the last page. Anyone who emails asking where the link is has not read the packet, which is useful to know early. It also filters out bad-fit prospects before the call, which raises close rate by removing the no-fit deals before a proposal is ever written.
Read the transcript
One of the most valuable strategies that I use in my proposal writing process, and this connects to What I do after I either win or lose a deal is record the phone conversations. This way I’m able to pay more attention to the other person. I’m able to reference the conversation as I’m putting together the proposal. I’m able to go back and email them and say, Hey, I noted during the conversation, da da da da da, and ask follow-up questions. And the reason I bring this up is because by recording the conversation at the start, it helps us better understand the complete scope of the problems that the prospect is experiencing. So once we submit a proposal or send over a quote for a productized service, If we get the no, if we get rejected by the client, if we get told, hey, you know, it’s not the right time, it’s not the right fit, I’m able to go back and better understand: okay, what did they come in the door with? What did my proposal propose? What solution? What outcome was I aiming towards? And where was that off the mark from what they were actually looking for? So Whenever I lose a deal, one of the things I always do is go back and review my proposal and review notes and listen, if I want to, to the recordings of the calls. Just to better understand, okay, where exactly was there not coherence, or where was I off the mark, or what exactly was the problem that prevented us from moving forward. There’s a number of other things that I try to do every time I lose a proposal, but I’m curious on your side, what’s top of list? What’s that first step you take when a proposal is turned down?
Drink a shot of bourbon.
I think that’s a good step.
Just one, because it’s the workday. Usually comes in the workday. Most of the time. By that point, I’ve never had a situation where people are like no or not right now and then come back and say yes. I actually thought for a long time that I should do some sort of big comprehensive follow-up campaign and And try and reactivate the lead and rewarm them and continue educating them and doing all the things. And maybe it was the client, maybe I didn’t do it right. I’ve gotten to literally 40 plus follow-ups with people, and it’s never been a thing. Like, it’s, I’ve done this with dozens of clients. I’m probably at this point just annoying them. And I don’t like being the guy who’s annoying you. Like, if I’m annoying you, it should be for a good reason. And if we’re never gonna work together and you just don’t know how to actually cut the rope, like. Then we’re in this like one-sided relationship where it’s like it’s it’s literally like dating where you’re hung up and obsessed with this person and they don’t give a shit about you That’s how I feel about 99. 9% of the people I have ever parted ways with. That said. There’s a very difference between the business and the people, right? So, whenever somebody says no to me and they were like initially really interested and I want to work with them, I pay attention to where they go after that. Because it could be that at the next business, they’re having similar problems. That converts. That’s something where you’re like, okay, continuing to maintain the relationship. But sometimes people just don’t care about what you’re doing anymore. How many times have I changed my business’s focus in the like, what, five, six years that you’ve known me? Like twice? And I have had a habit of doing that every two or three years. And if you really liked the like wireframey, design researchy, cadence and slang nick D of 2009, I have horrible news for you. You’re probably already clued into it.
He’s in the basement?
I feed him fish heads every week.
But no, you’re right. There are those iterations. And so you’re right. There is a point where. Follow-up impersons like that just doesn’t make sense anymore. There’s no longer coherence between what you’re offering and the problems that The prospect is experiencing. I’m sure if I was following up with lost leads from when I was focused on e-commerce SEO with my current offerings, they’d say, We do not need your coaching services and we do not need your help with marketing strategy for freelancers. Thank you so much. Please go away now. And so it’s good to acknowledge that. But I think there is value, like you pointed out, in follow-up and maintaining those relationships with people because it might be They move to a different company, or they get a promotion, or what I found is budget refreshes happen, or I follow up and say, Hey, you know, we didn’t work on that project together. Did you end up moving forward on it? And they might say, Oh, yeah, we went with you know, Joe consultant over here. Oh, that’s great. How did it go? The project was a firebomb, it was terrible. Send it to shoot it into space. How could I help solve this problem? And so. What I found is, even on those loss deals, maintaining that relationship follow-up and just being like, how’d that thing go? Was it a success? I’m honestly curious. And Empathizing if it did not go well, congratulating if it did go well, and then using that as an opportunity to stimulate a conversation about where their business is headed now, just because they said no back then. Doesn’t mean they’ll say no now, and it might be that they’ve uncovered a new problem in the business that you’re able to offer perspective and insight on.
Yeah, yeah. And sometimes, like, you know, there’s kind of an off-boarding thing. The best thing that I could possibly do with a client that said no or whatever, fly there. Seriously. And the only way that you can solve this, there is no such thing as a pick your brain call in this situation. You have to fucking get on a plane. You have to literally corporeally move your physical earthly form into a sky tube and get there. Because when you fly there, they get one hour to talk to you. And that is a potential opportunity to reactivate the relationship. And so I spent a lot of time. I was. Secretly in New York, like two months, three months ago, June, whenever that was. And I talked with a lot of old clients while I was there. And there was no sale. There was no secret agenda. It was just now you have an opportunity to remember that I exist. And that might turn into something in the future. I just kind of have a belief that the world works out. Like, I think if I I don’t know if this is obviously leaving potentially tens of thousands of dollars of lost business on the table, but I feel like. If I try and force these relationships, I’m annoying and weird and making it awkward and weird for them. And if I just back off like a skosh, like. And like say a serenity prayer and hope that things will work out. They kind of have a habit of doing so. Because I’m really good at being public about my work and my job, and good people find me. People know that I am not just a research-driven A-B tester, but like. They know what I care about in life. They know what my values are because I put them out there. And I think that’s done more to reactivate cold leads probably than any follow-up email sequence I could possibly recommend. I remember what that was we were at this conference in Stockholm like a year and a half ago, dude, and some guy on stage was like, I did a 29 email sequence and it closed. And that is so exception that proves the rule to me. Like, I’m great at closed. Like, please, like, I’m not gonna, I’m not gonna crap on your success at all.
But I think that client has been worth north of $200,000 to me. Yeah, just about $200,000.
Fine. Fine. That is again, that is another layer of exception that proves the rule. Like, what if I closed like a revised express lead and like, that’s great. I made three grand. It’s a one-off.
Made three grand.
I made three grand. Am I really going to care about that in five years?
Well, I think we get into a much, much larger question there that’s out of the scope of the episode topic.
Yeah. Yeah. I mean, there’s the question of like. I think you can’t have the question of what happens when a client says no without thinking about the way that you’re nurturing the relationship, though, because it’s like following through on your golf swing, right? Like you have to have The component beyond the single shot of bourbon. You can’t just make it a single shot of bourbon. You can’t just not reply to them for once. You have to put something in the reply. And then you have to think about Why it didn’t work out, whether it was you, whether it was them, and then you have to think about what to do about it. Do you email them in six months? I think there’s a lot beyond that, right? Like, because if a client nopes you in 2017, what are you going to do about it in 2020? Anything? Nothing is a perfectly reasonable answer here.
No, no, I hear you completely on that. I mean, for me, when it comes to getting a no on a proposal or a quote. The first thing I do is, I try to analyze what went well and what went wrong, or what could have gone better, because I think there’s always opportunities to take away some, like, okay. A, B, and C went very, very well here. I fell down on D. I lost a proposal a few months ago, and when I reviewed the proposal, I realized I never really explained or restated the exact problem they were experiencing. And so. For somebody who was reading the proposal, they’d be like, oh, yes, they’re proposing something. How does this fit into the bigger thing? So, first step for me is always analyze what went well and what could have gone better. The second step is always uncovering the real objection. So, they might have told me no. But why did they say no? Is it because of time? We don’t have enough time for this, or we’re on a different timeframe. Is it because of budget? Hey, we don’t have enough money this year or this quarter, but we might next year, or this is just out of our price range. Is it something else? What is that actual reason that they said no? And then, once I understand what the real objection is, I’m able to either modify my sales process to surface that objection earlier, so I don’t have to spend time writing quotes or proposals that won’t land. Or I could overcome that objection with the client. And I’ve actually had this happen recently where the prospect said, Hey, we can’t do it because X. I was like, Tell me more about X. We got into it, discovered it actually was a completely different reason, a reason I was able to overcome, and then we ended up working together on a project. So I think spending that time in communication post-proposal turn down to understand, well, exactly why are you moving in a different direction? If you’re headed in a different direction, what is that direction? Just so I could say, whoa, hey, you might accidentally be harming yourself here, or hey, that sounds great. Hiring somebody instead of hiring a consultant that makes perfect sense here. You should go with the employee. Here’s the books you should read to train them, or the books they should read. So, uncovering what that actual objection is, I find is incredibly valuable. I do firmly believe in lost prospect follow-up. I think, just like you said, maintaining that relationship with the person rather than the company. Can be incredibly valuable because it gives you direct insight into what they’re experiencing, what they’re experiencing in the future, how this project went. If they switch to a different company, the first two things I want to know is How’s it going at the new company and who replaced you at the old company? Because I’ve now just doubled my number of contacts. I now have one person at a new company and one person who just replaced that person at the old company. Maybe the new person at the old company, well, hey, they want to hire me for the service, where before we weren’t able to make the project land. And finally, even when I get turned down on a proposal, I’ll ask for a referral. If it isn’t, oh, hey, we dislike you terribly as a person. If it’s more, hey, we don’t have the budget, or this isn’t the time, or this isn’t the season, or we decided to hire an employee instead. I’ll just ask, do you know of anybody else who needs help in this capacity? Do you have any colleagues who need help with a similar problem? Maybe they won’t always land. Maybe only one out of ten or one out of fifty will land, but it costs me so little to make the ask? Why not habitually, just as part of my standard procedure, make that ask and have the referral happen when it’s supposed to happen?
Yeah, I agree with all of that. I think that This is a more actionable and helpful thing. You should be navel-gazing about the loss deal. Every time you lose a deal. It is an opportunity to change something. This is something that is very helpful. Every time I lose a draft revise client, or something goes like weirdly wrong about draft revises, not often, but it happens. I change something about the application process. I add a question, I rephrase it, I specify something a little bit better. And that makes it better. It makes you have to think that something genuinely went wrong on your end. And it can be small, right? It can be like. You didn’t mention that there was going to be a video call. Okay, how do you emphasize that in a reasonable way? It could be something really big like you don’t know when or how to disclose pricing. Do you do it on the call or do you do it in an email after? Those are all valid and reasonable things to be changing, right? But you need to understand how it went wrong and in what way you can try and improve out of it. Otherwise, you’re not going to improve and The goal, never make the same mistake twice. Make different mistakes, keep making mistakes, never make the same mistake twice.
What I love is I use a CRM Pipe Drive. And if any of the listeners are interested in trying Pipe Drive, you could get a 45-day trial by going to kaidavis. com. forward slash loves forward slash pipe drive and you’ll get a magic code uh automatically applied but uh i use pipe drive to track all my deals and whenever i lose a deal I will add a note explaining why they decided not to work with me and any information I have, any insight I have, any ideas I have about why the deal did not close. And I’ll periodically review them, say once every quarter, just so I could understand in aggregate why are people saying no? And individually, I might be might draw assumptions from people saying no. But if I look at three or four months of deals and say, why did these not close? I’m able to see, oh, wow, 60% of them didn’t close because of this reason. And I think taking that broad picture view in addition to that narrow view, Gives you a better understanding of what needs to change in the process. If 60% of people actually noped because of budget, well, we need a stronger pre-qualification phase to understand if they’re able to afford this and make sure they understand how much it’s going to cost. If it’s another reason, Just like you said, we need to change something about the process. We need to fix the bug that’s resulting in these lost leads.
Yeah, there’s always ways to fine-tune the system, right? I think that’s the more helpful thing than just like me being like guns blazing, fuck it, because that’s not the case. You can change, this is the thing, you can change so much about your business. But you can change hardly anything about their business when they obviously don’t want to work with you. Right? That’s the key takeaway here. So, change stuff about your business because this is fundamentally a match between your business or what somebody thinks their conception of your business is and their business. And I think that’s to be, that’s way more important and valuable to be learning.
And I think there’s some times where it’s just a no, and it’s not you. It’s not necessarily that there was something wrong on your side. It just was they solicited proposals and they got noped from higher up. And There’s nothing you could really change on your side to prevent that. Or they were about to hire you, and then, hey, you know what? The money we had set aside for this project. We needed to spend on XYZ, infrastructure replacements we didn’t anticipate. The truck broke down and we needed to buy a new one. We had a shipment stolen and we needed to move funds around. So there might be situations where It’s not that you need to change. It’s just some percentage of deals don’t close.
There’s also. It is a good opportunity to say, okay, well, how many Brown MMs, did I receive, right? We talked a lot in a previous episode about potential like negative indicators that a client could possibly provide you. And we called them brown MMs after the like Van Halen story, where he demanded that all brown MMs be removed from the ball backstage. I look back and think like, oh, okay, well, this client was being weird in this like five or six different ways, and it resulted in us not Working together. Okay, well, how and why? And can I look at that and say, okay, well, it’s not me, it’s them, right? There’s Yeah, there was one client where they were like, I’m definitely not going to be very hands-off. How okay are you with people who are hands-off? And I’m like, I’m okay with people who are hands-off, but mostly people are hands-on because I’m mucking with their brand statement. And they’re like, okay, well, I’m going to be hands off. I’m like, okay, great. Six follow-ups later, shocking no one. He was like, We didn’t configure Google Analytics. And I’m like, that was in scope for the project. Like, that was literally in the welcome packet that you didn’t read, and then asked me a bunch of questions about that indicated you had not read the welcome packet. And this is Like, this was one client that was just like, no, no, no, we’ll figure it out when we’ve got GA together. I’m like, okay, great. Bye. And then I never talked to them again because I looked at that and I’m like, this is actually not a good environment. The best kind of clients are the ones that you can look at and be like, I really don’t need this. Like, it’s not for me. And then you can move on. Mm-hmm.
Can I share a small welcome packet hack that I’ve uh started using?
Um provide a welcome packet. No.
Well, A, provide a welcome packet. Dear listener, it’s very valuable to provide welcome packets.
God, please.
I’ll be writing more about this on my mailing list at kaidavis. com over the next few weeks. So please do tune in for that. But uh. So, I typically send my welcome packet across before the initial call where I’m qualifying them as a prospect, where I’m essentially interviewing them to see if they are a good fit. They filled out my application by this point. We’ve exchanged maybe one email, and I now send across a welcome packet. I say, Great. The next step, once you’ve read the welcome packet, book a call, and we’ll have a one-on-one, 30-minute video call. I’ll have an agenda prepared, ask you a bunch of questions. But I include the link for the call on the last page of the welcome packet. So if I ever get a reply back, that’s like, great! Read it. Where’s the link? I’m like, you didn’t read it. You didn’t read it. I know you didn’t read it. Go to the last page. Liar, liar, pants on fire. And I found small things like that. And it’s not necessarily a malicious thing at all. It’s just including the next step at the end of the current step.
Put call link at end of welcome packet. I’m putting that on my to-do. Like, that’s happening for all of my futures. Fucking brilliant, Kai. Ah, ah.
But yeah, any so often I found that, I mean, the benefit of a welcome packet, and we could do honestly three episodes on welcome packets, and we should. The benefit of the welcome packet is educating people before the proposal about how you’re going to work together. So they aren’t caught off guard with the proposal or the idea of productized services or exactly what it is that you do. And if you include that call link there, you’re essentially forcing them to read through it. You’re making sure that they’re reading through it. And I think that helps increase your proposal close rate for two reasons. One, People are now more primed to want to work with you because they better understand who you are and how you do business. To the people that are not a good fit, They’re gonna nope earlier. They’re going to dope before that call, saving you a wasted call, wasted emails, and a wasted proposal. So By including steps like this, you actually increase your close rate by removing the bad fit prospects earlier on in the process.
Yeah, yeah, I like that a lot. All right, stealing your ideas. That’s it. That’s the only way I know how to run a business, anyway. So it’s just stealing Kai’s ideas.
Yeah, two years ago, I thought of the A-B testing manual, and well, here we are today.