Who Are Your Best Prospects?

With so much focus on the role of technology in data analysis and warehousing, it’s sometimes easy to forget that customer knowledge isn’t a software package or a database — it’s an approach to doing business.

This approach can be enabled through huge, complex client data warehouses and advanced smart data mining applications to uncover hidden trends and important insights into buyer behavior. But it doesn’t have to be.

This article outlines three basic principles small and medium-sized businesses can enact in terms of client intelligence and how they can be used to improve customer retention and satisfaction.

Principle 1: Your best source of new business comes from people you know or currently do business with.

You know the drill. You take a big business trip. You make a major sales pitch in the Far East. The promotions and big bonuses in your shop always seem to go to the partner or principal who lands the Big New Client.

But while the majority of the investment in time, money, and resources are often directed toward winning the big new client, the fact is that most organizations would do far better if they shifted their precious business development and marketing budgets toward the clients that they know and meet with every day.

Your best prospects are right here in your own back yard, where you can meet with them and talk to them face to face. Instead of relying on complex and inexact technologies to discern buying patterns and predict demand, you can simply ask them what’s bugging them and offer suggestions on how you can help.

But what about getting new clients? Yes, you need them, too. The trick is in developing the right mix of efforts based on their relative probability of success. Cold calling is a high-volume, low-probability game — kind of like buying a lottery ticket. Do it as a fundamental part of your marketing mix, not as your primary business development strategy.

Principle 2: Your best sources of new business come from your largest or most profitable customers and prospects.

You don’t need a marketing guru or a complex data mining algorithm to figure out who’s most likely to buy from you next. You already know; it’s the same people who usually buy from you.

Try this exercise: Develop a list of your customers and determine your largest or most profitable segment. In some businesses, this group may represent a minority of your current customers — say only 20 percent. Add to this list your top 20 percent of prospects.

You now have a marketing database that is better than the most sophisticated, expensive, and elaborate contact management or sales force automation system money can buy.

Treat this list as if it were the crown jewels. Because it is. Focus on these accounts, and you are bound to succeed.

Principal 3: Identify what works and leverage the hell out it.

As important as customer and marketing intelligence is, internal intelligence, or for lack of a better term, “corporate self-knowledge,” may be just as important — and maybe even more important in some cases.

Most organizations I’ve worked with were ill-equipped to take a hard look at themselves and realistically assess their market opportunities and understand their core competitive strengths.

My advice: Take a hard look at what works and what doesn’t. Look at what your biggest and best clients have in common. Then take a good, long look at what factors contributed to closing those sales.

Trim or radically rethink the parts that don’t work; accelerate development of what does work. And in proliferating what does work, don’t reinvent the wheel. Develop templates and repeatable processes to leverage your core strengths and control the quality of implementation.

If you focus on these three principles, you’ll probably be way ahead of your competition.

What are your thoughts and experiences with customer intelligence systems? Please send them along to me at Arthur.oconnor@reuters.com.

Related reading

nurcin-erdogan-loeffler_wikipedia-definition-the-future_featured-image
pwc_experience-centre_hong-kong_featured-image
12919894_10154847711668475_3893080213398294388_n
kenneth_ning_emarsys_featured-image
<