Sales best practices for improving sales win rates, shortening the sales cycle and increasing overall quota attainment. Sales strategies to make revenue growth repeatable, and scalable
I read some very interesting research the other day and learned that the likelihood for sales people and account managers to win new business in existing accounts is between 60 and 70%. Can you imagine closing 60-70% of your opportunities? Wow! On the other hand, when it comes to developing new business with brand new accounts the success rate drops to between 5-20%. If you knew your sales win rate could be that high would you take the time to effectively plan, measure and manage your existing accounts? I would sure hope so.
Your key customer accounts first and foremost must be protected and second, they need to be managed to grow to their full revenue potential. Failure to do so can result in financial ruin. Sales professionals including account managers need to have both short-term and long-term goals including a methodology for actively managing and growing strategic accounts. Without a strategic account development methodology including metrics to measure success, it can be difficult to assess if your account managers are simply passive “order takers” or as I like to refer to them, “relationship builders.”
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One of the things I have learned over the years is that it’s very difficult for sales reps to develop and execute account plans. There are a number of strategies and methodologies to follow but there seems to be very little support and practical advice on how to best to put it all together into an effective and cohesive account action plan, without overwhelming sales reps. After all, what is the point of putting a strategic account development (SAD) plan in place if you don’t have the tools and action plan to execute?
This blog is part two of a two-part blog series on account development. You can read part one, Questions to Consider for Account Planning & Growing Existing Accounts. In this blog post, grow existing accounts with account planning I highlight the common challenges associated with growing existing accounts and account expansion and offer remedies. First, if you want to grow existing accounts and develop a partnership, you have to strengthen and deepen your existing relationships, AND establish new relationships in other business lines or departments AND at the enterprise (executive) level. This requires sales people to break out of their comfort zone mentality of “my client” and view the relationship as a “company to company” relationship. Organizations that do the most effective job of growing existing accounts focus less on how much they’re liked by the customer and more on the business value of the relationship (of how the client perceives the value). And that involves getting your entire organization involved in serving the client. And doing that requires account planning. Unfortunately, despite their best intentions, many strategic account/key account or target account programs under perform. The most common reasons IT staffing firms fail at growing existing accounts are listed in the table below
One of the most common sales training requests (and sales goals of IT staffing firms) I hear from prospects and customers alike is growing existing accounts. Let’s face it; everyone wants to grow revenue in their existing accounts. So why is it so challenging? IT staffing firms should be selling more of their service offerings to their existing accounts but they’re not. There are a number of reasons for this including but not limited to: • Lack of training, account planning tools or methodology on behalf of the sales team (account management team) • Mixed messages sent to sales teams to “open new accounts” and “grow existing accounts” • Sales people being afraid to “get out of their comfort zone” and develop new relationships in existing accounts • Lack of resources (team members are spread too thin) • Compensation is out of alignment (doesn’t drive the right sales behavior) • Internal barriers to cross-selling (internal politics and turf wars, lack of collaboration) • Territorial sales people (lack of trust, etc.)
When prospective clients approach us regarding our account planning and development training programs, one of the most common requests we hear is the desire for their sales team to strategically sell and expand existing accounts. Sales leaders and business owners alike share with us their frustration over the lack of penetration and relationship development within their key client accounts. They ask us, “why is it that our competitor has 40 consultants on billing with ABC company yet we only have two and we can’t seem to sell outside of the HR department?” This is a legitimate question and concern.