A recent New Yorker article on the financier Martin Armstrong’s obsession with cycle theory got me thinking: while I don’t know anything about cycle theory, I’ve looked at enough data to observe that some numbers are indeed fixed. Not literally fixed in that they are absolute numbers like pi, but fixed in the sense that they are hard to move and in that they will tend to revert back to the mean. This makes them very powerful from a management perspective in that changes in either direction provide you with a lot of information about what’s happening in the marketplace.

Take the sales cycle – or the time it takes somebody to go from an evaluation to a purchase. Over time, we observe that the sales cycle, especially in B2B contexts, is especially fixed by customer. Different people and different companies simply have different ways of making purchases and it’s very hard to lastingly change this. Of course you can inflect this through discounting or special offers, but these effects are temporary at best. Marketers can learn a lot from watching the sales cycle as carefully as possible because it’s a very powerful indicator of whether or not demand for a given offer is either slowing or expanding:

• If the sales cycle goes down across multiple regions and people for a given product/service, then this almost certainly means that the market is growing. This is the time to suggest aggressive campaigns to capitalize on the momentum. It’s also a good time to consider expanding coverage through the addition of people.
• Conversely, a contraction of the sales cycle should suggest a change in the nature of the demand.  People will tell you that deals are stuck in the pipeline, and this is when marketers face maximum pressure to come up with a quick relaunch or a new campaign. Realistically, they would do better to resist this and instead focus on quality of business, concentrating resources on fewer customers known to have significant needs.

Incidentally, there’s always the person whose sales seem to go much faster than everyone else’s, and most likely this person is doing something differently. It’s worth finding out so that marketing can tell everybody how to similarly get on board. But there’s also a chance that this person is simply a little more restrained about entering unlikely deals into their pipelines – and that too is worth understanding.

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