MEDDIC

When one company sells something expensive to another company, it often takes months. Software for twenty departments can quickly cost several hundred thousand euros. No single person ever decides on such a purchase alone. MEDDIC is a checklist that salespeople use to systematically examine such deals. They answer six fixed questions about every prospect, for example: Who signs at the end? The name is a made-up word formed from the initial letters of these six points.

Why salespeople sort out customers

A sales team’s time is limited. Anyone who spends half a year courting a prospect who ultimately doesn’t buy has lost that time. This happens more often than one might think. Many conversations seem friendly and promising for a long time but never lead to a signature.

MEDDIC is meant to make such cases recognizable early on. The method originated in the 1990s at the US software company PTC and has since been considered a standard in enterprise sales. It forces salespeople to ask uncomfortable questions that one would otherwise like to avoid out of politeness. For instance: Is there even budget allocated for this project?

For investors, the topic is interesting for a different reason. Software companies forecast their revenue for the next quarter. This forecast is based on a list of ongoing sales conversations. If these are poorly vetted, the forecast is too optimistic and the company misses its targets.

The six letters in detail

M stands for Metrics, meaning measurable figures. The customer should state what the purchase will bring them, for example two hours of work time saved per employee per week. E stands for Economic Buyer: the person who releases the money. This is often not the enthusiastic department head, but someone from senior management.

D stands for Decision Criteria, the criteria by which the decision is made. Does price matter more, or security? The second D stands for Decision Process, meaning the sequence of the decision. Who reviews what and when, which committees meet, when is it signed?

I stands for Identify Pain: the concrete problem that actually hurts. Without real pain, the purchase remains a nice maybe. C stands for Champion, the advocate within the customer’s company. This person fights internally for the project, even when the salesperson isn’t in the room. Some companies add a second C for Competition, meaning rival offers, calling the whole thing MEDDICC.

MEDDIC in software and in AI sales

In practice, MEDDIC lives on in sales software. Systems like Salesforce or HubSpot manage all of a company’s ongoing conversations. There, every deal has mandatory fields corresponding to the six letters. A salesperson can only mark a deal as promising once the fields are filled in.

What’s new is that AI systems are filling in these fields themselves. Tools like Gong or Clari listen in on video conferences, transcribe the conversation, and analyze it. If a sentence like “the board still needs to approve this” comes up, the system enters it under the Economic Buyer point. It also warns if an important point has been left blank for weeks.

A common misconception is that MEDDIC is a conversation script. It is not. The method doesn’t say how to persuade someone, only what one needs to know about a customer. For small purchases, this effort isn’t worthwhile. For contracts worth around 50,000 euros in annual value or more, however, many software companies enforce it as mandatory.