When companies plan for organic growth, they often look exclusively at customer acquisition (the “hunter”/Sales function) and overlook account growth (a “farmer”/Account Management function)˳ In this case study, a company that compensated salespeople (hunters) based on new-customer acquisition did not correspondingly incent the account managers (farmers) for finding the full revenue potential of each customer relationship˳ Instead, the account managers oversaw the equivalent of repeat orders and resolved customer complaints˳ With very little additional training and partnership-orientation from departmental leadership, this function can often fully exploit the beachhead established by Sales˳
This is one in a series of case studies highlighting “Key Questions and Course-correcting Quotes” taken from 20 years of B2B customer insight projects˳ All names are fictitious, but the situations are real˳ Case studies paint a picture of how important it is to learn what your B2B customers think–but aren’t saying˳ These are real-world examples of how soliciting and acting on customer feedback has helped companies hold onto customers longer, grow relationships bigger and pick up new business faster˳
Case study: How “Farmers” Started Printing Money
Key Question (asked of an operations manager–the vendor’s chief contact in this 6-figure relationship):
“Are there products or services you’d like to see ‘LiteManufacturing’ add?”
Course-correcting Quote:
Operations Manager: “We buy kits from LiteManufacturing, but we have to buy components from another vendor˳ I’d like LiteManufacturing to start offering components˳”
My Client’s Quandary:
This was a simple baseline feedback project, not a treasure hunt designed to grow revenue, yet there it was: money being left on the table˳ I knew LiteManufacturing sold kits and components; was there a reason they hadn’t told this customer? One call to the account manager, and he understood how he had dropped the ball˳ He immediately walked his customer through LiteManufacturing’s full offering and picked up that customer’s component business˳ The president then required all the account managers to hold annual “account review” meetings with the 20% of customers who represented 80% of the company’s revenues˳ Objectives: Give customers a chance to offer unstructured feedback, and remind them about everything LiteManufacturing offers˳
Not only did LiteManufacturing grow walletshare with individual accounts, the account managers deepened their relationship with customers and started to enjoy their jobs more˳ On the other side of the table, customers began to feel a sense of collaboration with LiteManufacturing that was missing when Account Management was a passive function˳
Conclusion:
It’s common for customers to only know what they already buy from you˳ This can happen when:
- The prospective customer wasn’t listening during the sales process˳
- The salesperson limited his discussion to details about one product or service for fear of “talking past the sale˳”
- Nobody took the time to educate existing customers about new products and services as they were added˳
- There was turnover on the customer side, and the new contact person only knows about current purchases˳
As part of on-boarding and the formal/informal account review process, the relationship owner should review everything his company offers˳ When there is a personnel change on the customer side anywhere along the chain of command from the day-to-day contact to the owner of the budget, it’s smart to treat the new person as a new customer˳ You want them to be familiar with your entire offering and to recognize that their relationship is important to your company˳ When there is turnover in relevant positions on your side of the relationship, it’s smart (and often strategic) to have the new person introduce him/herself up and down the customers’ chains of command˳
There are three costs to failing to fully service existing accounts:
- Leaving money on the table today (loss of incremental revenue)˳
- Creating a “beachhead” opportunity for competitors (failure to develop and defend one-stop relationships)˳
- Weak positioning (failure to create partnership-level standing with customers)˳
Vendors miss an opportunity to shift from vendor to partner when they fail to incent account managers to fully develop customer relationships˳ The first step in turning this around at your company is to put a partner-oriented leader in charge of Account Management˳
I categorize projects as assessments, investigations, treasure hunts or rescue missions˳ This project was an assessment-turned-treasure hunt˳ The client’s question was “Where do we stand with our customers?” I’m always on the alert for outliers, because I’m trying to have the same conversation with customers as the company president would if he/she had the time˳ No president is going to overlook money that’s being left on the table!
Source by https://ezinearticles˳com/?Stop-Leaving-Money-on-the-Table!&id=8654153
