We struggle to get a foothold in a large account. Winning that first deal in the account requires us to get the customer to change. To get them to think differently, addressing problems/opportunities differently. If we succeed, we have helped the customer innovate, to rethink what they currently do, and to do it differently. The customer chose us because they felt compelled to change.
Once we do win and get that foothold, we seek to expand that relationship, we want to grow within the account. We have a number of strategies we leverage to do this.
Retention: It’s important that our customers are happy with what they’ve bought from us. We make sure we serve them well, address problems they might have, focus on creating and maintaining a great customer experience. Primarily, this is targeted to getting renewals when the current contract terminates. But we also leverage this great customer experience to expand.
Expansion: We’ve got some presence within an account, we want to grow that. If we have a PLG strategy, we may have a few users/seats, but we want to maximize the penetration of our products across the potential population of users within the account. For example, if we sell a technology sales people can use, we want every sales person in the company using it. If we sell embedded products, we may want to expand our share position, moving from second sourced to the primary supplier, we may want to make sure we our products are included in follow-ons our customers may be developing. We look to be designed into other products. Likewise, with our service offerings, we want to expand the utilization of these in the customer.
Expansion strategies are a little more difficult. We may be moving from a small presence, expanding it significantly. We have to make sure we are creating differentiated value with our solutions. This perspective of value will change as we expand within the customer. A few users will seek certain elements of value. Getting a corporate-wide commitment, the expectation of value creation/realization is very different, partly because more and different people are involved, partly because the potential impacts (positive and negative are far greater).
Another challenge with expansion strategies, is we face competition once again. It’s not simply an issue of getting more users, but other users may be using other products. Within my own small company, we have a split opinion of a few different tools we use. For example, we all use mind-mapping tools extensively. I prefer a certain tool–I’ve used it for years, I’m comfortable with it, I like it. Several people on our team use a completely different tool, and they are strong advocates of it. Both vendors keep coming to us, wanting to get full share of our company, and they face entrenched stubbornness on the parts of each of us; which neither have been able to overcome.
Alternatively, because it may be a bigger decision, the buying group may want to assess a number of alternatives. So competition becomes a bigger factor in our expansion strategies.
And, of course, there is cross sell. We try to find opportunities to sell other products within the same account. Whether it’s new users, or the same users adding these new products. And, doing this faces similar issues that we face with retention and expansion.
The advantage we try to leverage in any of these is our incumbency status. The relationship, hopefully good, that we have developed with the account. Hopefully, we’ve fulfilled their expectations with what they’ve already bought and they are happy. We also have relationships/access, they know us, we know them. Leveraging the power of our incumbency has, traditionally been a fundamental part of our account management strategies.
And to some extent, it works….
But there’s a problem. We become part of the “status quo,” within the organization. Any disruption to that status quo, is a threat to those solutions we have already sold.
And there will always be those threats. The customer may face new challenges or want to address new opportunities. Competitors may have developed novel approaches, new ways of solving the problems we are currently solving.
We actually become part of the problem. We want to maintain our position, we don’t want the customer to change, we defend the status quo. But what happens when the customer commits to a change process, either through their own analysis and business management processes, or through some other vendor disrupting their thinking, inciting them to change, helping the customer innovate.
Where we think our incumbency position should help us–even when a customer is looking to change, at least we have the relationships built. The research shows it doesn’t, in fact we may be disadvantaged because we represent the status quo.
As we rethink our account growth strategies, we have to reflect back on how we developed the relationship originally. The customer bought our solutions because we helped them change, we helped them innovate.
It seems that if we want to expand our relationship, to grow what we do, with the customer, to be seen as a critical partner-rather than a strategic vendor, we have to look back to why the customer originally chose us.
How do we help our customer innovate? How do we move beyond defending the status quo, to becoming change agents with our customers?
As you look at your strategic account planning, what specific things are you identifying to help the customer innovate?
We’ve seen such huge shifts in share, growth, retention, and relationships with organizations that shift there account strategies from, “how do we do more business with you,” to “how do we help you innovate?” The most significant aspect of this is the shift from a customer vendor relationship to a strategic partner relationship. The customer views these organizations as critical to their ability to grow and move forward.
Afterword: If you want to learn the secrets of incorporating innovation into your account planning process, reach out. Glad to share the experiences we are seeing our clients achieve in this process.
After-afterword: Look at the word cloud that accompanies this post. It’s a vivid demonstration of how we get account planning all wrong. In searching for an image, I looked at about 15 different word cloud representations. None included the words “Innovate,” or “Change.” Hmmmm………
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