Strategies to Keep Revenue from Slipping Away
Sales reps can also widen their parameters a bit when they’re selling. Perhaps they’re only selling one product line or only selling to one division in a company, or there might be other companies that need the same kind of products. “In these cases, you want to be asking for references,” Dickie says. “If the people you’re selling to know others who might have interest, ask them to introduce you to these individuals.”
Taking a holistic approach to customer accounts also helps.
“In the area of customer account management, it’s critical for sales leaders to not separate the pursuit of sales opportunities from the end-to-end management of customer accounts” Reynolds says. “For this to happen, you need a strong account planning discipline.”
Unfortunately for many organizations, account planning is exactly what’s not happening in any kind of regular or systematic way. “Account planning in many companies is not a core competency,” Dickie laments. “The planning binder sits on the shelf and doesn’t see the light of day.”
One problem is how salespersons are incentivized, according to Dickie. “The sales leadership of any organization should be taking a look at the message that the compensation plan is sending the salesperson,” he says. “If you speak to the person’s wallet instead of the person, you get a better result.”
Dickie suggests giving lower commissions for sales to existing accounts and higher commissions for closing deals with new accounts or selling new products to existing accounts. Salespeople can also be evaluated based on their ability to reach the most senior-level decision makers at their accounts.
This wallet value helps sales reps shift their behaviors and become more effective at revenue optimization, Dickie says.
“When I was selling at a major computer company, if I asked for the CIO and was put straight through, I got a one rating. If I was asked, ‘Who’s calling,’ this was rated a two, and if I was asked what the call was about, the score was a three,” he recalls.
“In other words, the deeper the relationship and the better the quality of the contact in the organization, the more likely it is that you would succeed,” he says
If salespeople receives less commission for making a sale of an established product to an established customer, and a higher commission for breaking ground with new product sales to existing customers or with new sales to new customers, they’ll start prioritizing the latter.
Rating systems like this require companies to look critically at their customer relationships. They can’t just send out the basic marketing emails and hope for hits.
REVENUE OPTIMIZATION
To help in the process, software is now available that goes beyond spreadsheets. Customer account management software can issue alerts to sales reps when they haven’t updated customer accounts in quite some time or alert sales managers when members of their sales teams are overdue for account management and planning.
“A customer account management system—sometimes also called customer revenue optimization (CRO)—is one way to ensure that salespeople update their customer account management plans every 30 days. It also alerts them when and where they need to take action,” Reynolds says.
In other words, the sales account management plan no longer sits on the shelf.
Business software manufacturer Autodesk recently moved to a CRO system to transform its selling process and reduce revenue leakage.
The goal was to become a customer company instead of a product company, according to Adrienne Walker, a senior sales manager at Autodesk.
“Right now, we’re in the middle of the biggest transformation we’ve ever done,” she says. “Along with the flexibility you get from being a subscription company, it also provides some amazing access to data and helps us guide our customers in how they use our products and how they can be more efficient.”