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A pickup-artist sales mentality
How are you going to grow your business in 2024?
Because growth is good, right?
But the growth-at-all-costs mentality can cost you growth in the area that really matters: profit.
Top-line growth is all you hear about. If you’re a listed company, or working toward it, it’s what analysts demand. That headline number is the story the journalists want. Every LinkedIn hustle post teems with rocket emojis.
The 10x growth mindset, particularly in B2B, is that of the pickup artist.
Eternally on the cruise for new “targets”*. Talking lots about yourself. The thrill of the pursuit, the adrenalin surge of beating your competitors, the flex of announcing your latest win in the trade media.
The boss wants growth right now
You come back fired up for 2024, draw up the chart of potential new clients, new target markets. This will be YOUR YEAR.
Your existing customers are taken for granted, the boring lower floors of the graph column that prop up the exciting growth penthouse at the top.
Your bosses want to see that growth RIGHT NOW. They want board reports with hot new client prospects listed.
Pardon me raising a cliched point you already know, but it’s much cheaper to get new business out of existing clients.
The numbers vary depending on which sales training course you get sent to. I’ve been taught it’s five times more expensive to get the same revenue from new clients. And 15x. Whatever the number is, the overall point is real.
No matter how strong your current relationship, there is so much untapped potential in your current clients.
Existing clients will take your calls.
Clients who aren’t yours mostly won’t.
They don’t mind the idea of talking to different suppliers, at some undefined point in the future. But they really don’t want to hear from you right now because they’re very busy. This busy phase just rolls on forever.
The best kind of growth
Research by Bain & Co’s Frederick Reichheld – the guy who invented the net promoter score – shows increasing customer retention rates by 5% increases profits by 25% to 95%.
That profit – not sales — drives the best kind of growth.
With profitable growth, you can afford to hire the good people. Buy the working assets. Do the training. Move to better premises. It all that makes your customer’s experience better, which creates a virtuous cycle of more growth via word of mouth.
Unprofitable growth is a world of pain. Multiple layers of bandaids. Sleepless nights as payday looms. If the growth is strong enough, having to dilute your equity to the point where you may as well be an employee.
Some bad news for your 2024 new business plans
New business growth is hard. And this year, it’s going to be harder.
Regular readers will remember Cian McLoughlin, whose sales win/loss evaluation platform Trinity Perspectives we invested in last year. He has a lot of data and client feedback on current client sales and buying trends.
We caught up recently, he’s seeing a lot more risk aversion out there at the moment.
“We’re seeing a real trend towards sticking with incumbents, in many cases despite clients not being entirely happy with their performance.”
Cian endorses the value of putting more effort into existing clients. He points out they’re less likely to shop around for multiple vendors, and they have less tendency to haggle over pricing. You’re a known quantity for them, and they don’t have to struggle with vendor set up or onboarding.
“And yet each year, in most B2B sales organisations, the lion’s share of the time, effort and most importantly marketing spend is devoted to folks who may never have heard of the brand and are highly unlikely to buy this year anyway,” he said.
The pollination effect is your friend
New clients are nice to have, but they bring uncertainty. They’ll be somewhere on the standard client bell curve between delightful and nightmarish.
At this point you don’t know where.
Existing clients are great because you know what you’re dealing with. You can plan around it, and you know their expectations.
When you’re building your relationship with existing clients, it’s a mistake to focus your attention only on the core decision makers. Everyone, no matter how junior, has influence potential. Encourage your people to build relationships at all levels.
You don’t have to have meetings with everyone, but every interaction is a chance to be seen to be likeable and responsive. It’s an investment that will pay off far in the future.
In our industry, a fair percentage of new clients come from the pollination effect. A contact who likes you changes jobs, and introduces you into the new place.
Their door-opening is so much more effective than your own sales outreach efforts.
Show you’re not taking them for granted
The effort you put in, or the lack of it, is clearly visible to clients.
We won a few re-tenders late last year. Some of those clients had been with us for over a decade.
We were the favourite to win, because incumbents almost always are. And we had the clearest understanding of their needs for obvious reasons.
It would have been easy to take it for granted and do a good-enough pitch.
But we put together documents and presentations like we were pulling out all the stops to win them for the first time.
Not so much to win, but to signal to them that they are still important to us. That we’re not taking them for granted.
The re-pitch process allows you to step back from the day-to-day relationship and ask them questions about their big-picture plans and objectives, and how you can help them. It’s a valuable strategic re-set.
Please don’t interpret this story as advice to not seek out new clients. You need them for so many reasons. To replace old ones who stop using you for reasons beyond your control. To create the momentum that attracts good staff and gives them a more exciting career path.
Just don’t forget to give your existing clients the same love while you’re doing it.
*While trying to find a suitably skeezy word to use here, I ended up reading a summarised set of tips from The Game, the Neil Strauss 2005 blockbuster on pickup life. And now I must take a shower in Dettol.
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