CSO Insights reports that sales cycles in existing accounts are at least 50% shorter than new accounts. This is a huge savings in cost of sales and marketing investment in return for greater profitability and revenue growth. But, when asked to share their top priority, sales and marketing often cites filling the funnel with more leads and capturing new accounts.
Even though revenue derived from existing customers account for 70.1% of total results, CSO Insights also reports that there’s not a strong ability to expand business in existing accounts with 54.9% of companies reporting a gap in penetrating new business units or cross-selling/upselling. In working with SaaS, SCM tech (WMS/TMS/ERP), IT implementation firms and 3PLs, I learned that the challenge lies with silos and the traditional hand-off between sales, marketing, and account/customer success teams. In rare instances do the three departments work together with shared common goals and metrics and execute jointly to win, protect and expand specific accounts. This provides a great growth opportunity for the teams to work together to not only identify the best margin and revenue growth opportunities but also help named customers “see” how you help them solve business problems in a way that increases their loyalty.
Let me share with you some examples of how “must keep” accounts were protected and how “must grow” accounts were expanded by aligning sales, marketing, and customer success teams.
Account-Based Enablement Protects At-Risk Fortune 25 Accounts Like P&G….
P&G (a long-time client of a regional 3PL located in Green Bay, WI that specializes in DC management, WMS & TMS) was a customer that our client looked to grow. The accounts team drove discussions at the Director level. But it was about the activities that were being completed and general “benefits” – and not about the gaps that were filled and how it positively impacted operations, finance, employees and the customers. Because accounts were not having the right customer conversations that were supported by case studies, content and messaging that proved “unique value” gained and where future opportunities lied, the team was not able to drive top-to-bottom engagement. They could not get access to the VPs and the CXO that Ryder (a larger, national competitor) had close relationships with. Three years of having the wrong conversations led P&G to caution our client that the company will most likely move to the larger, lower-cost national provider. This was our client’s biggest customer with the greatest revenue growth potential and they were about to lose it!
To overcome the relationship gap with the much larger competitor, the team decided to involve sales & take a personal approach to marketing. This began with building LinkedIn profiles, content, case studies and personal messaging for the purpose of penetrating P&G. For example….
- When you read the profile for Diane Mitchell (SVP of Sales and Marketing), you’ll see how she talks about how 50% of 3PLs under-leverage the warehouse, distribution center, and transportation as they focus on costs rather than growth (a key differentiator). She discusses her 14+ years of tenure at P&G to demonstrate that she understands their business, operations, and culture. And you’ll see stories that are relevant to P&G such as how segmented visibility resulted in Ryder making suggestions that would slow inventory turns by 50% and put 40% of direct ships at risk for P&G. She didn’t just make claims – she proved how other 3PLs focus on costs instead of getting a strong and accurate measure of how each part of the supply chain impact each other and their customers’ growth. And, she proved how it impacted P&G personally.
- When you read the case study that was created for P&G, you’ll see that it’s not meant to just build credibility like most case studies. It was designed for the conversation that sales and accounts wanted to have with P&G leadership – a conversation around gaps that existed, why it existed and how our client was the only 3PL that would have filled those gaps. It was built for a conversation that showed the impact on On-Time, In Full Delivery that our client (a key focus area) and the total value achieved in addition to where the future opportunity lies. Backed by stories, the purchasing manager decided it was time to reconsider buying habits. This led to an intro with P&G’s Director, who worked with the 3PL director regularly. Only now, the connection was made through purchasing on the promise of a case study about themselves. The attached case study discussed not only past challenges & KPI growth but also future opportunities. Once he understood the impacts to himself and his team, he now asked our client to meet with the corporate VP decision maker. There, the stories were further validated to prove the case on hard costs vs soft costs (and risks versus growth)
- When you read our client’s “On-Time, In Full Article”, you’ll see how manufacturers like Unilever (a key competitor to P&G) has low service performance to customer scores and how it will cost them 3% in profit margins. Within the article, Diane shows how shipment delays are not just a transportation problem and it can be caused by how the warehouse and DC operates. Three out of the 6 stories that prove it’s not just transportation were based on the challenges faced at the P&G plant and DC that our client directly fixed. When you read our client’s “Total Value” article (which was created immediately after the buying committee mentioned that they wanted more than cost savings and that they are looking for increased efficiency, stronger KPI growth, improved customer experiences) you’ll see stories that demonstrate how most 3PLs have limited control over inventory turns even though there’s a 77% correlation between turns and profitability. You’ll see how 3PLs put cost over the customers of their manufacturing clients, which impacted service performance and organic growth. And, again most of the stories speaks directly to P&G. While the content can be used more broadly, it was first designed for the conversation that sales and accounts wanted to have with P&G.
Based on personal marketing, P&G went from cautioning that the company will most likely move to the larger, lower-cost national provider to awarding new e-com business without an RFP or bid process. They are also in conversations to expand in site 1 while developing strategies for additional locations. This was achieved because sales and accounts profiles and content were used in email, social and in live conversations to prove to the buying committee how soft costs, risk reduction & new growth would quickly replace any ‘freight’ line item reductions the enterprise competitor can offer.
Account-Based Enablement Changes Buying Behavior & Creates Margin Growth with Accounts Like Sephora
Sephora’s website is the largest revenue making store in North America, even with an expanding base of 430 stores across the Americas. However, their warehouse and DC were not scaled to meet the needs of a fast-moving operation or the needs of their 2300 global stores and their eCommerce customers. For example, the manufacturer’s tech did not enable the warehouse to prioritize replenishment, which led to delayed orders, waves and carrier moves. They weren’t engaging in planned distribution where the warehouse knows how products will ship to stores even before it arrives at the warehouse. And, while they implemented automation for expected volumes, the company lacked fulfillment automation for surge demands caused by new, hot lipstick colors or holiday demand.
Driving this, most tech implementation consultants functioned like the manufacturers’ line workers: reacting, not proactively strategizing. Our client, a JDA implementation firm, kept receiving a shortlist of 30 pain points needing coverage within six weeks to go-to-market causing our client to build for “wants”. Because our client, was not having the right customer discussions, Sephora would treat our client as technicians and pay for man hours vs. strategic value that has higher profit margins and revenue growth. And Sephora would try to penny pinch and negotiate on the number of hours and resources that would be needed for different projects.
There was no conversation involving our client in the go-to-market planning of new products or lines. They didn’t have the content, stories and messaging to show how building for 30 software points only seeing 5-8% of the entire picture is leading to missed details and requirements as there’s no visibility into pipelines, growth plans, customer driven needs, and current/future operational bottlenecks. They weren’t able to show the impact and how it delayed retail/e-commerce presence, wasted marketing dollars, increased days in inventory, slowed cash conversion cycles, missed customer shipments and created out of stock conditions. They weren’t able to show Sephora how the current reactive IT approach was allowing Ulta to beat them in customer loyalty and for Amazon to make inroads with the high-end beauty market as GTM time for new products and shades were increased by 6 months. Ultimately, they didn’t have messaging, content and support for the “why evolve” conversation that needs to happen to change “buying behaviors” and expand profit margin and revenue growth.
Image Source: Corporate Visions
Once the client was able to shift the customer conversation with profiles, content and messaging that was designed specifically for the why change or why evolve conversation, they were able to change the client’s perception of the firm from “technicians” to “strategic partner”. Our client joined leadership in the planning stages. They added value with processes that will show how changes would impact the warehouse, distribution, and transportation under different scenarios and allow the beauty retailer to adapt and scalably align with new system changes without disruption to stores or customers. With this added value came more profitable revenue growth that was stronger than trading dollars for hours.
Account Based Enablement Expands Accounts Like Treehouse Foods
Treehouse Foods was an existing customer for Schneider’s transactional freight brokerage service, however with only a 1% share of wallet. 99% of the clients’ business belonged to the competitors.
The account manager would ask for opportunities to discuss growing the business each month, but the client did not see the value or find any compelling reason to move forward. They saw Schneider only as a tactical partner who would provide low-cost trucking rates, rather than a strategic partner who could also help them reduce larger operational costs.
Now, because key insights were made available online, Schneider’s VP of Sales was able to engage the senior decision-makers one-on-one and invite them into a LinkedIn community with discussions around how mid-market supply chains are under-served by gaps in technology and processes. Rather than using the community as a news feed or ‘tips and tricks’ blog, it was instead used to create an understanding of gaps, re-frame the client’s ideas, and open their minds to a new path to value.
These discussions revealed significant challenges within their existing partners and processes, which the sales team has also leveraged in their live, offline discussions. Because the inbound supply chain leaders were pulling the sales team through the buyer’s journey and into discussions on “how Schneider would fix their processes”, we know that Schneider is positioned to take over their transportation management once their existing contract ends.
- A current client became available for a larger close
- Schneider is positioned to be awarded new business
- The win can increase their wallet share by at least 25%
- RFP price battles are avoided by showing a differentiated value
So, before you even look for new market growth – look internally at the customers you already have. Select the account targets you must “protect”, you must “change buying behavior” and you must “expand”. Then put together the messaging and stories you need for specific “why stay”, “why pay more for customer renewals and upgrades” and “why evolve for upsells, cross-sells and product migrations” conversations. Notice the keyword “specific” in my previous sentence. This is not about speaking one-to-many. It requires a personal approach.
I discuss this further inside my Account-Based Enablement Community where you’ll find new ideas and personal account-based approaches that are sales, marketing and accounts to drive new market and existing customer growth.