Hidden Costs in Sports Sales Organizations

Our recent success in sports has been driven by teams leveraging sales & marketing data to increase sales and reduce costs. When teams are aware of where their sales and marketing budget are being misallocated, they are empowered to make positive change.

The cycle of waste that we see in pro sports begins with the time that is wasted by individual salespeople. We are not talking about the time that reps waste scrolling through their Facebook feeds under the guise of “research,” taking a three-hour lunch, or doing this month’s Cosmo quiz. We have no line of sight to any of that nonsense and therefore can’t measure it. We have no reason to believe that this kind of “waste” is more prevalent in sports than in any other industry. We are talking about the time that hard working, well-intentioned salespeople waste by over-investing in prospects that are the longest of long shots to ever win.

Sales reps and managers – like the rest of us – are human beings.  Every human being is subject to biases and tendencies. These biases, however, prevent sales reps from looking objectively at all of the open opportunities in their sales pipelines. Because salespeople in sports tend to be less tenured than we see in other industries, these biases are more pronounced. Sales reps compare open opportunities to a limited mental inventory of deals that they have won and over-rely on their intuition about the driving forces behind those wins.

This leads reps to focus entirely too much of their time on opportunities that “feel” like winning deals. They will tell their managers, often convincingly, about specific deals that are coming in. They believe these deals are imminent. The rep might put these deals in the CRM system at an advanced stage. They might list it as high likelihood percentage or “commit” the deal when the manager has a 1 – 1 pipeline review.

To ensure the success of these deals that feel like winners, reps often continue to exert significant effort. They are confused when weeks turn into months and they fail to get an answer from the prospect. They are often shocked days or weeks later when their sales prospect disappointingly declines.

A few surprise losses are inevitable in any sales organization. However, in professional and collegiate sports organizations, the aggregate time that is wasted on these deals that were quantifiably unlikely to ever win is staggering. This time waste alone can be easily translated into hundreds of thousands of dollars (or more) in unproductive labor hours.

The time that reps waste on unlikely-to-win opportunities always comes at the direct expense of other opportunities that are significantly more likely to win. These winnable opportunities suffer from neglect. Over time, the probability of success on these neglected deals steadily declines.

The net result of all of this incorrectly applied focus is reduced win rates, longer sales cycles and lower gross sales.

Unfortunately, this time that is wasted by salespeople is only the beginning of the story for most sports teams. Solutions that have been implemented to compensate for salespeople’s inefficiencies have only led to more waste. Importantly, when organizations understand the root cause of the challenges, many solutions will become readily apparent.

James Dries