By Ed Pierce, FMW Brand Acceleration
With advances in customer relationship management tools that incorporate every milestone in the buying cycle all the way back to a prospect’s first website visit, along with instant, segmented digital surveying capability, companies can obtain more information about buyers and buying habits than ever before. Combined with the availability of a broad range of timely sales reports, the “opportunities” picture has never been clearer.
Many sales budgets are prepared on the basis of either incremental percentages or a number agreed upon with the team (at most it is divided into the products the organization has and the geographies it is catering to).
Neither method is as effective as customer-centric budget planning, because they do not consider what must be done to achieve the numbers, especially if there are new people on the team.
Building Blocks of a Customer-Centric Sales Plan
The basic building blocks of a customer-centric sales & marketing budget and plan are:
- New Customers: How many new customers you currently have, and how many customers you expect to win in the coming budgeting period; what sales volumes you expect from those new customers.
- Customer Retention: How many customers will you retain and how many you estimate you will lose, and what sales do we expect from those you retain.
- Customer Value Development: How have you added value to your customer accounts, and how many customer accounts will you grow from sales point A to sales point B (of course, noting that not all retained and/or loyal customers will have the same sales levels they will be starting from).
How Do We Start?
Start by reviewing your transaction data, identifying what products sell together, and developing cross-sell propositions for your customers at large. Once an organization undertakes this exercise for the first time, it uncovers new ways to acquire, retain, and grow customers.
For companies that never viewed their business health from a customer-flow perspective before, it is eye-opening compared to the traditional approach of emphasizing how many units of their star products they managed to sell without digging deeper into who they sold them to and whether these were regular customers or just one-time customers.
When a company views sales with a customer-centric perspective for the first time, more questions arise:
- Have your customers left you or have you left them?
- Why has your customer retention been so low?
- Why are your customers not buying more from you over time?
At this point, a company can start developing a plan to find the answers to these questions, and you can develop your first customer-centric sales budget. We’ll address that next month.
Feel free to call me at 484-957-1246 or send an email to me at [email protected] to share your experiences, ideas, and other comments about your own marketing goals!