Observation #42
There are only two basic ways to increase your sales volumes: find more customers and/or sell more to existing customers. There is a little more complexity when you dig into the numbers (e.g., market growth rate, customer churn, etc.), but they are basically the two ways to grow volume.
Therefore sales organizations generally require two types of salespeople, sometimes referred to as farmers and hunters. Farmers service existing accounts, doing their best to maintain or grow the base volume of business, whereas hunters have to find and sell new accounts.
Many sales initiatives are designed to increase volumes but, in practice, whether or not you are trying to find new customers or increase volumes with existing customers makes a big difference in the project approach. It’s also worth noting that not many people are both farmers and hunters. They each have very different social styles, and trying to turn farmers into hunters (or vice versa) is usually not a recipe for success.
If you need to win new accounts, the key lever to focus on is lead generation. Where and how do you find the “Glengarry leads”? For those who haven’t seen the movie “Glengarry Glen Ross,” these are the leads every salesperson wants, the top-prospect accounts. Many sales- improvement initiatives focus their energy on increasing the productivity of sales reps (increasing their calls per day for example), but this is not overly helpful for finding new accounts; it’s actually better for the farming side of the business. We also often see a focus on the later stages of the funnel (e.g., proposal writing, handling objections, closing, etc.). All of these are important, but they tend to get attention because they are more tangible and immediate. The real leverage comes from the top end of the funnel. How can you secure quality leads and make sure they get into the hands of your best hunters?
The best way to grow new accounts is to make sure that your organization has a very clearly defined lead-generation process and to make sure those leads are carefully and deliberately managed through the sales funnel. The added benefit of this approach is that it’s also the best way to increase the productivity of your hunters (i.e., fill their schedule with quality leads). Growing volume with existing accounts requires a different focus, which we look at in the next Observation.
