At the beginning, when businesses start to sell a B2B product or service, most will spend all of the time chasing new sales, writes Paul Higgins, consultant at business services company Rapid Innovation.
At the beginning, when businesses start to sell a business-to-business product or service, most will spend all of the time chasing new sales, writes Paul Higgins, consultant at business services company Rapid Innovation Group.
But as more and more customers sign up, the strategy for generating maximum revenue may need to shift to up-selling, which is selling more of the same product, or cross-selling, which is selling other products to existing customers.
In these circumstances, the role of the account developer often becomes important.
Some growth-stage businesses never need to develop an account development function but others may come to rely upon it.
The skills, knowledge, processes, and relationships needed to chase new sales can be quite different from those required to develop and generate more revenue from existing customer accounts.
Chasing new sales is about hunting down opportunities, disrupting the competition, and getting a foot in the door.
To do this, the salesperson needs to an expert in the outside economic climate and market that affects the customer. Also, they need to be a resource that can inform the customer about what’s going on beyond the scope of their organisation.
On the other hand, existing accounts are developed by fostering strong customer relationships, ensuring satisfaction, understanding the politics of the their organisation, and not allowing the competition to create opportunities.
To succeed in account development, sales people need to be experts in all the things that affect the customer’s business internally and be a change agent and a networker.
So does your business need an account development role? There are a number of factors to consider.
As a ballpark figure, if around a third of a business’s revenues come from existing customers rather than new customers, then think about creating a role to focus on this.
If up-selling or cross-selling is not relevant to the business, then account managers or a customer help desk may be adequate to ensure repeat business and contracts are renewed.
But if they are relevant, identify the skills, knowledge, processes, and relationships that are required in the sales team to execute an account development function. If they differ significantly from those needed for new sales then defining this as a new role within the commercial team may be a good option.
Before splitting up a sales team into new sales and account development, ensure that staff members are aligned in the right roles because some sales professionals prefer the hunt and others enjoy building long-term customer relationships.
If the decision to split the force is made, provide incentives for the account development team on the retention and up-selling to customers, and also ensure and encourage both teams to work together.
Finally, start building the relationship between the customer and the account developer early because otherwise it may become restricted to the operational level and not achieve your up-selling and cross-selling goals.
Encourage the sales team to involve the account developer throughout the new sales process and build them up as experts in the field by regularly including them in meetings and projects.