So you have scientifically classified your customer base and prospect pool, using not only sales or margin contribution from each customer over past 12 months (so-called Current Value) but you have also used data, estimates or proxies for each customer’s total sales or margin equivalent for all products/services within the categories in which you compete (so-called Potential Value). As a result, you now have a defensible case to label every customer by class, eg Tier 1, 2, 3 … gold , silver , bronze … A, B C, etc. You are on your way to best practice B2B sales team optimisation.
Whatever terminology you use, your top class will , depending on your level of scientific granularity, be characterised by two sub-populations…those customers with relatively high CV, but lower PV (where you enjoy high share of wallet… your “loyals”). Then there will be those with lower CV, but higher PV (where you enjoy lower share of wallet, but arguably higher opportunity for growth…your “cultivates” ).
The question that should start to rattle around now as you consider this from a sales team optimisation perspective is what sort of visit frequency should I ascribe to each of these top class sub-populations? There are two considerations to apply in answering this. One is based on the types of “trusted partner” activities you want the sales team to execute for competitive advantage…first and foremost before classic account management sales and service activities. This has been the topic of recent posts.
The other consideration is based on your competitive position-in-market and your stage-of-lifecycle. If you are not a current market share leader, then you are likely to ascribe a higher visit frequency to your cultivates than your loyals. If you are one for the market goliaths, then the opposite ascription is likely to apply. Bottom line, apply the thinking rigour and don’t just blithely ascribe the same visit frequency to both sub-populations.
Next week we will consider how best to maintain your “cellar dweller customers”.
Want to learn more? Check out “How relevant is your sales team optimisation?“