Accelerating Account Growth
Accepted wisdom suggests that selling into your existing account base should be easier and cheaper than winning new customer logos. This may well be true when selling more of the same products and services, however, when it comes to adjacent or breakout growth, too often your incumbency does not deliver the commercial advantage one would expect.
Research tells us that most suppliers have increased the breadth of their portfolio over recent years, seemingly making account growth targets more easily obtainable, yet, at the same time, account growth remains disappointing. In fact, the opportunity for cross-selling and account growth has never been higher but many suppliers are just failing to execute and deliver on their revenue growth potential, a situation further exacerbated by the new reality of transaction B2B sales in the world of COVID-19.
Furthermore, the new reality has changed us all and the way we operate. Account plans, set prior to the outbreak of COVID-19 need updating and operating models revised. Pressure to grow revenue on existing accounts has massively increased and there is a temptation to create account plans to support forecasting and inform management rather than develop a customer focused strategy to deliver ongoing value and a win/win for you and your customer.
85% of companies that participated in a recent Gartner poll say there are “uncapitalised growth opportunities within existing accounts”, with Martha Mathers, Managing Vice President of Gartner stating that “Over half of B2B marketing functions have missed their account growth goal targets at least once in the past 3 years” and it is highly likely that this situation will deteriorate further as businesses face up to the new reality.
Becoming A Trusted Advisor
Research shows that customers are seeking longer-term true relationships with a smaller number of suppliers. The customers will have higher expectations of these suppliers and look to these suppliers to deliver on their desired business outcomes. Identifying and then focusing on those activities that help your customers improve their business and deliver on their strategy is the key to enabling account growth. Achieving this requires a supplier challenging the customer with some new thinking, showing the customer something they may not have come to realise on their own. With this insight a supplier can create an urgency for change in the customer, compelling them to act. Leading with insight it this way and positioning yourself as the trusted advisor to your customers is shown to have a significant impact on customer retention too.
Understanding customers’ rationale, their business strategy, ecosystem, stakeholders, as well as emotional engagement are fundamental to building insight and, in turn, driving successful account growth. It is worth recognising that the required relationship for growth is almost the same as that for change in the mind of the decision makers. Excellent service can enable renewal but growth of adjacent and breakout services requires a different set of decisions and evaluations.
Maximising the advantage of being an incumbent also requires and effective sales strategy, as experience shows that even when your customer has decided what they want to do and has a supporting business case, just being an incumbent provider has shown to have very little commercial advantage for breakout opportunities. Recent Gartner research shows that 78% of B2B buyers with new business needs are as likely to choose a new provider as they are to expand their account with the incumbent.
Although incumbents may not have a huge advantage in the mind of their customer, they do benefit from an understanding of their customer’s organisation and procedures, such as their procurement or governance processes, and that can be used to enhance confidence across key stakeholders. Incumbents may also be able to exploit an existing framework or contract to move to a sole-source position more effectively, therefore avoiding competitive procurement processes.
Suppliers who provide informative content to help buyers navigate alternatives in the selection process, including the omnipresent “do-nothing” option, increase decision confidence by 400%. These actions contribute indirectly to account expansion.
Stakeholder Management Is Key
“Working in Silos” has become one of the most commonly used phrases in the workplace. It represents people, teams or companies who are working towards the same objective, often in close vicinity but not sharing information, people not talking to other people. Often this leads to wasted time and cost, not to mention missed opportunities. It is commonly understood, that regardless of the customer’s industry, on average there are more stakeholders involved in the buying process now that there were a few years ago. More complexity to weigh down the process. More opportunity for someone to say “no”.
To overcome this, suppliers need to able to create alliances between various key stakeholders and influencers across these silos. Not just identifying common ground, but providing insight so as the seemingly unrelated strategies of the various silos have a more comprehensive understanding of the overall outcome and underpinning change required. This increases confidence in the supplier and elevates them towards the coveted “trusted advisor” status. However, achieving this is complex as suppliers, having come up with the valuable insight, now need to tailor their messaging to a variety of specific roles and individuals to ensure that the message is effective and compels the individual stakeholders to action.
Tailoring as a concept is relatively simple, we have all been doing this naturally in our family and wider social interactions since we were children. Applying the techniques effectively in business to business situations though takes time, preparation, and practice. When you look at your customer stakeholders, yes you can see their observable behaviours, you can listen to what they have to say, and you can read about them in social media or the press, you maybe you are fortunate enough to be able to enquire about them from others who know them better, but what about what is below the waterline? Their assumptions, values, and beliefs, discovering these is critical to successful tailoring and requires skill and agility on behalf of the sales or account professional.
Inhibitors To Growth
The inhibitors to account growth are many and varied including:
- Account or delivery teams unable or unwilling to go beyond their current scope or comfort zone
- Less face-to face time between end customers and supplier account teams as customers look to have more virtualised engagements with less time in their offices, so relationships take on a newer, less intimate, form
- Lack of understanding of the end customers desired business outcomes or strategy inhibiting the supplier to deliver valuable commercial insight
- Failure to execute existing account plans or existing account plans being rendered obsolete due to a disruption to the end customer’s business, common place in the new reality of a COVID-19 world
- Inability of account managers and their teams to identify, qualify and close adjacent and breakout growth opportunities
- Customer’s current perception does not view you as a trusted advisor or a strategic partner for transformational change
- Customer’s current understanding of your capabilities is limited to one or more specific silos with limited platform for improving their understanding
- Limitations of breath and depth of your customer stakeholder network
- Issues and challenges relating to the current scope of supply diluting the focus on account growth activities
- Restrictions of the current commercial framework
- Lack of visible reciprocity
- Disconnect between the supplier’s wider capabilities and the incumbent account-centric team
- Compensation plans geared towards revenue attainment through retention, renewal and repurchase, rather than account growth
- A focus and operating model geared towards defence of existing revenue streams rather than offence of targeting new ones
It is clear from the evidence that service alone, even exceptional service, does not necessarily drive growth. The facts are that delivering service and driving growth are not the same thing. A culture where customer service is prioritised over everything else drives the focus of the account manager, even when service levels may already far exceed what is required for retention. This translates to wasted time and effort, that could be better utilised on structured growth activities.
A clear focus on the customer’s business, identifying areas that the customer’s business could be improved and leading with insight, rather than the supplier’s capabilities, coupled with a view towards the future rather than looking back at the history of the account, is the change in mindset required to drive account growth.
Digital Distance Accelerate Account Growth
Digital Distance specialists have deep expertise in the transformation required for suppliers to drive account growth in the digital age. We can execute a tailored programme that facilitates the design led thinking required to achieve an effective and executable, insight led, account growth strategy. We build on this with by regular support sessions and best practice events to ensure that the programme execution works flawlesly.
Prior to the sessions, our team will perform extensive customer and indursty research, ensuring we have the background to drive deep customer focus during the session.
Applicable to both private and public sector accounts, this programme can be performed virtually or physically in person.
Engaging Digital Distance specialists to transform and accelerate your account growth attainment activity ensures:
- A clear view of where qualified growth opportunities exist within your existing customer
- A workable plan as to how to maximise the revenue return from these growth opportunities by creating momentum within your end customer and an effective win strategy
- A profile of all the key customer stakeholders and influencers for use in targeting and tailoring existing and future propositions
- A common understanding across your relevant internal stakeholders as to the strategy for growth at your customer and where each of their responsibilities are in executing against that strategy
- An upskilling of your account or delivery team’s sales effectiveness and ability to shape and close breakout opportunities