In the B2B marketplace, business planning often stays at a macro level with ideas being tabled that aim to target market sectors rather than individual customers. Whilst this is understandable and is often resource-savvy, it often undermines the value that can be attached to one individual client account.
There’s more than just revenue
In the B2B marketplace, clients become part of a company’s brand, their corporate offering and reputation and become part of the driving force for future decisions. The argument could even be made that the Customer Lifetime Value (CLV) generated from the client isn’t the most important gain from signing a single high value client.
Importantly, the signing of a single client could have a strong impact on future strategy. For example, how are territories for sales teams impacted by signing a particular client given that the need to avoid interest conflicts becomes all the more important? Perhaps signing the new client gives you prominence amongst businesses in a new sector or even with businesses that are greater in size than before.
Does your new research tell you that you should be expanding into new areas geographically or in the same areas with a new approach? Only the correct tools and analysis can tell you this.
What can a new client mean?
- A case study for future business – Who knew your service could be especially useful in the catering industry or in the public sector? With a client in such a market, they become your means for demonstrating a potential return on investment for other similar businesses.
- An ambassador for your brand – People talk to people in the same industry and people recommend either overtly or through ego. Having a company that publicly celebrates the gains from your product or service is infinitely more valuable than any advertisement.
- A learning experience – Being able to adapt your service to new applications is a necessary experience borne from signing a new client.
Another look at your existing customers: profiling
Existing customers can sometimes be another database entry whose regular orders justify the expenditure in signing them. But can you be sure you understand your customers’ potential value?
By analysing and identifying the profile of high-spend customers according to variables such as annual revenue, industry etc we may discover customers whose spend with your company is just a fraction of their total product spend. Given that your relationship with this customer already exists, they can be seen as a valuable sales ‘lead’.
Conversely, it’s also possible to use such profiling techniques when seeking new customers. Should the sales team focus on potential customers who match the profile of existing high-spend companies?
The marginal value of one additional client
A new customer is worth significantly more than the revenue value gained and this could be reflected in your strategy. Simple mathematics probably wouldn’t support pouring resources into signing one new client but taking a step back and considering the above points should certainly be food for thought.