I get a very questions from B2B Sales people about the ranking of accounts including prospects. This is a fundamental exercise for B2B sales people and it is based off the Ideal Customer Profile. Every existing account and prospect should be classified or ranked according to some standard. The standard is determined by either the company or the sales person.
Here’s how it works. You refer to the Ideal Customer Profile and review what the best customers traits. What sales level do they attain every year, quarter or month. How often do they purchase? Is it daily, weekly, monthly or once a year? How many product lines or SKUs do they purchase? These are simple analysis that every sales person should know well.
Then you create an A group consisting of the best customers you have. These are the customers that get the most attention from you. These accounts will need regular touches because every competitor will be going after these accounts with much effort.
The B Group usually has two types of accounts. The first group are the up and coming A customers. They are usually growth companies that will soon move into the A based upon your criteria. The second group are the no growth, yet, they buy a solid number of products – sometimes only one SKU because that is all they want and need. And, in some cases, you will have former A accounts that are losing ground due to factors beyond your control. Their business model is failing or new competition has taken their market share. These accounts will need some attention – especially the growth oriented B’s. Remember, these accounts are usually very profitable for your company as their requirements are not as strict.
The C Group are the small to lower middle sized accounts. They usually have low volume with limited purchases. These accounts will or should be handled as cost effectively as possible. Even use tele-sales methods for these accounts or move them to internet based purchasing systems. The key is to keep your costs low for getting a good return on these accounts. Now, there could be a potential A customer in this group and it is your job to identify these potential A accounts as soon as you can. What for trends in the business model – sudden upticks in volume, PR suggesting a high growth factor, a new product or service with big growth potential, more inquires into new product designs or requests for changes. These are signals that something is up and you need to investigate.
The last group is the D group. These are customers that you may ask to leave. I know that sounds bad, however, as a B2B sales person, you only have so many hours a day to trade for sales. You will want to spend the vast majority of your time with the A and B customer groups. This is where your sales success and sales growth will come from. The D customer is the one who is always on the cheap. They want rock bottom prices, long payment terms and lots of attention and visits – even when the dollar sales volume is low and the account analysis shows an unprofitable relationship. You need to pass these accounts off to inside sales or in some cases – recommend they go elsewhere. I have seen some sales people actually raise their prices to these customers and they move to the C group due to new found profitability.
Prospects require the same attention as existing customers. Here is the opportunity for creating a Target List of Prospects. The target consists of the A level prospects and some B level prospects. These prospects heavily match up with the Ideal Customer Profile and therefore, these are the accounts that need your time and attention.
Be creating a prospect ranking and targeting the high growth accounts, your sales success will improve over time. If you go after any account with no thought about their real potential – then you are wasting your time and energy AND most important are foregoing performance and results for activities with little outcome potential. Take the time and invest in your future by identifying the best targets, develop a plan for winning their busines and then execute on your plan.
Now that’s a winning formula.