Lets face it; winning new business is fun.
Particularly in service firms and for technical applications where there is substantial personal involvement required to gain clients. But the jubilation of landing new accounts often leads to problems.
While you’re focusing on gaining new clients, settling them in, and organising the recently won project, what about your other clients? Remember them? You know, the ones that still want you to do work for them. Their requirements may not seem as exciting as they once were, but you cannot afford to ignore them.
It is often the case that firms do not have a formal sales development plan. There is little prospecting or account management done on a regular basis and this can mean from time to time the call goes up to “Get out there and sell”.
Reactive sales management can mean clients go cold
One of the major shortcomings with this reactive style of sales management is that relationships with clients go cold.
When you are busy on new ‘exciting’ projects, other customers may sense they are being neglected and start shopping around for other firms to deal with. Sometimes the first you know about this is when you eventually get back in touch with your clients after a long period of being absent. Too late.
Whilst it is advisable to increase your ‘share of market’ by looking for new clients, it is wasteful to ignore the existing relationships and potential value of current clients.
A better idea is to also consider maximising your ‘share of customer’
How do you take a ‘share of customer’ approach?
Follow these steps:
1) Identify the sales potential of each client. The ‘potential’ is the total value of all services (of the type you offer) consumed by this client over the next 12 months, regardless of whom they currently source them from.
2) Subtract from this potential the value of any services that are not open for your firm to supply. Limiting factors may include the clients current contractual obligations, their sourcing from a related subsidiary or division, or relocation/rebuilding of facilities or plant etc.
3) Calculate the ‘share’ of this net potential you wish to achieve. This share will be based upon a combination of hard and soft data such as: developments within the client organisation, your historical earnings from the client, changes affecting the clients industry, your firms strategic direction, and your firms relationship with the client. This value is now your sales target for this client.
4) Develop a client-specific strategy for achieving the sales target. A good sales strategy will include:
- A combination of personal actions designed to build interpersonal relationships with key client personnel. Such actions would likely include: Personal visits to client premises;Using corporate hospitality to entertain clients; and Attending industry events.
- An educational component to advise your client of your firms capacity to assist them.
- A critical review of current projects to ensure a better understanding of the clients needs and to maintain customer service standards. In particular a review should cover elements of interest to assist in achieving the sales target – client staff changes, client attitudes, competitive intelligence etc.
5) Incorporate the sales target and strategy in your firms regular review procedures. Staff will report not only on new and current projects, but also on the development of your sales ‘pipeline’. The review process should also check the status of any limiting factors, as at some point they will change.
By adopting a share of customer mindset to managing your sales you will create a proactive structure in which sales opportunities can be monitored and fostered.
In particular, you will be able to capture and document important information regarding client developments and potential sales that may not otherwise have been recognised.
So you can still have fun winning new business … but remember to get your share of ‘old’ business as well.