By
·
4 minute read
After venturing out of KPMG and starting my own niche B2B consulting business, revolving around helping companies future proof the way they conduct Sales, Marketing, Customer Service and Customer Success, I have observed five distinct improvement points that appear to be relevant to nearly every project I encounter.
- A Value Proposition that needs articulation
- An Ideal Client Profile that needs defining
- A clear Strategy that needs to be set
- A better alignment between Sales, Marketing, Customer Service and Customer Success
- A better use of CRM and process based ways of working.
Let’s briefly delve into each of them.
#1. A Value Proposition that needs articulation
With one look at the website, the first 30 seconds of the sales pitch, and the first sentence of the outreach message, it is often clear what the company does.
While this is nice for your ego, it is detrimental to your business.
You are not selling project management software; you are selling a more organised, efficient workflow and the ability to complete projects on time. You are not selling an online course; you are selling new skills, career advancement opportunities, and the potential for personal and professional growth.
Formulating your value proposition into a way that connects you with a need, rather than talking about yourself is a major improvement to any sales and marketing approach.
While it may seem like an open door, if you were to randomly select 10 companies, 9 of them will not be using this simple technique to boost results.
#2. An Ideal Customer Profile that needs defining
Not every customer is a customer you want to have. A nice exercise to do when going through your customer base is to map customer net profitability.
You will discover that, when taking all costs related to customer acquisition and customer service into account, quite a lot of customers are costing you money. While there can be a number of reasons for this, the top reason tends to be the lack of standardisation in the way you deliver value.
A customer base that is too diverse in needs, working methods, and willingness to pay for value received makes many businesses feel like they are mopping the floor while the faucet is still on.
Identifying an Ideal Customer Profile will help your marketing and sales people to target customers that will bring revenue and value.
While there are several different components to defining the ICP, two central components that are crucial, in my opinion, to include are Customer Lifetime Value Potential and Mutual Values Congruence:
- Customer Lifetime Value (CLV) allows for reliable income streams and spread of acquisition and service set-up costs over a longer period.
- Mutual Values Congruence (MVC) is about the match in ways of working, ethical standards and cultural fit.
#3. A clear Strategy that needs to be set
Strategy is hard and requires consideration of many elements, including market dynamics, societal factors, and economic conditions. Many strategies and go-to-market models are possible.
However, in day to day sales, three strategic options will prevail regarding where you will put time, money and resources.
- Make sure to maintain profitable existing customers (Churn Prevention)
- Sell more to existing customers (Upsell)
- Develop new customers (Acquisition)
There is a reason why they are in this order.
It takes ages to find, register, and nurture profitable clients. Their retention should be the number one strategic ambition of any company.
Selling more to existing customers is easier - and less costly - than making new customers. To quote Jaco van Der Kooy: “the goal is to transform linear growth into compound growth by continuously delivering value to customers and expanding the scope of engagement.”
Acquisition is costly. Recent research has exemplified that the cost of acquisition in some industries has doubled or even increased 10-fold due to increased competition, reduced buying appetite and the increasing wage and operating costs linked to business development.
Clarity about what needs to be achieved and where the priorities are for the moment will boost marketing, sales and service performance anytime and any place.
#4. A better alignment between Sales, Marketing, Customer Service and Customer Success
You would imagine that since Philip Kotler published Marketing Management: Analysis, Planning, and Control, in 1967, the role of marketing as an equal function to sales should be commonplace in most organisations.
You would also imagine that Customer Service and Aftermarket would be considered profit centres by most companies, especially after the 2019 article by Guy Benjamin and Harold Brink demonstrated the significant income potential of Aftermarket Services, setting a revenue generation threshold of 30 to 60%.
You would imagine that most companies by now would have applied some form of Customer Success to make sure that customers make the most out of their investments.
Well, think again.
In most companies, while marketing, sales, and customer service functions exist, they often operate in silos under different leadership. The Customer Success function is rarely used, and when it is, it is entangled in a sales role, which is contrary to what the Customer Success function should be.
Bringing together all four functions under one leadership, deploying them in an integrated process, and equipping them with the right tools provides a major boost to any commercial organisation, with rapid and positive impacts on customer satisfaction, revenue generation, customer retention, and commercial efficiency and effectiveness.
#5. A better use of CRM and process based ways of working.
Most companies have some kind of CRM.
However, most companies use only a very small part of the CRM functionalities.
Often, CRM is merely a gentrified address book with an unreliable sales pipeline visualisation.
By making use of the CRM capabilities for customer profiling, segmentation, lead qualification, lead nurturing, customer development and interaction alignment, major efficiency gains can be achieved and meeting and forecasting reliability will surge.
Using CRM will also bring a more systematic approach to selling. Whether it involves using account plans, blue sheets, or any other form of thinking and planning before acting, this ensures that energy, creativity, and motivation are directed toward the areas where they will yield the best results.
By working on these points, significant and fast improvement to EBIT can be achieved, often with limited efforts.
Do you recognise these 5 themes of improvement? Do you see other low hanging fruit improvements that should be on the list? Would you like to talk about applying these concepts to your business?
Looking forward to your input and happy to discuss.