Part 1: Ensuring and Growing Your COVID Renewal
In times of uncertainty, it may be tempting to ‘hunker down’ and wait it out. Focus on maintaining the status quo. Don’t try anything new. Don’t take risks.
However, after every recession, the Harvard Business Review, McKinsey, Bain, and other management consultants publish research showing that leading companies leverage economic volatility to move faster, innovate more, and take market share from competitors.
“By our reckoning, nearly 40 percent of leading US industrial companies toppled from the first quartile in their sectors during the 2001 recession, and a third of leading US banks met the same fate,” says McKinsey & Company in Preparing for the next downturn. “At the same time, 15 percent of companies that had not been industry leaders prior to the last recession vaulted into those positions during it.”
Your customers need you to leap into action now more than ever before. They are looking for someone to help them succeed. They need a ‘lifeline’ in times of trouble.
As you tackle the second half of the year and strategize for next year’s success, double down on understanding your customers and how you can help them be more successful. If you do that, their partnership and renewed business will in-turn make you successful too.
Strategic organizations are resisting the urge to pause and instead focusing on four fundamental building blocks of how to be more valuable to your customers and grow revenue. In the first half of this blog series, we will look at the two most impactful areas to drive revenue during a client renewal cycle.
Step 1 – Ensure Your Renewal.
If you have competitors in your largest customers, you can be sure they are looking at your renewal and strategizing on how to take that pie slice from you and add to their plate.
You need to be able to answer three (3) questions to ensure that you earn the renewal.
1. Do you know the senior executives that are supposed to be getting value from your solution?
If you sell technology or services, you need inside advocates beyond the project owners in IT or Operations. You need to identify and build advocacy from the actual line of business owner; Manufacturing, Sales, Marketing, Finance, etc. Who are the specific executives that are excepting value from your solution?
2. What value have you delivered?
What specific BUSINESS value do the executive stakeholders expect? Hint: the answer here is not, “we have six-sigma/.999999 uptime” or “we are in the green on all our Service Level Agreements.” Those are table stakes. Ask yourself, “what are the business outcomes they need us to help deliver (usually denominated in money, better margins, better customer retention, more revenue, reduced costs, fraudulent activities prevented, etc.)?
3. Did you highlight the business value you delivered? Did you monetize it?
In your upcoming business review with the customer make sure you get the credit you deserve! If you sell a platform that helps in recruiting, it’s not about how many new recruits you brought in. it’s about the fact that you brought in 10% more recruits, with 30% fewer recruiters, thus saving the company $ xxx per recruit. Make the connection back to the business value so your contributions to their business are recognized.
Step 2 – Grow Your Wallet During Renewal
A lot of companies look at a renewal as a time of fear ‘the customer is just going to beat us down on price, or they’ll go to a competitor.’ As mentioned before, now is not the time to settle for complacency. Take the initiative to expand your client contributions and win more cross-sell and upsell opportunities.
We’ll use that mindset to grow your wallet share. Look at nearby Cross-sell or Up-sell opportunities and see if any of the following exist.
1. Can You Increase Volume?
Situations where the customer buying center (region, group, etc.) buys the same product from you and two or more competitors is a great opportunity to eliminate the 3rd and/or 4th competitor. Take it all or split it with the top 2 vendors (you are one of them).
2. Can You Position Nearby or Related products?
From the customers’ perspective are there complementary products or services to those you currently sell that the client gets from a competitor (e.g do they buy 2 security products from you and 1 or more other security products from a competitor)? Or, maybe they buy application modernization services from you but application outsourcing from someone else. Or, do they buy your adhesives for the dashboard of cars, but not for the upholstery?
3. Is There an Untapped/New Buying Center?
Does another one of your customers’ regions, manufacturing sites, etc. buy a competitor’s product? Can you offer a volume discount on the currently shipping product to expand its footprint in this customer?
Now is the time to double down on strategic planning efforts. Deepen insights into how your customers are adapting and how your organization can help address their needs. Train your (now virtual) employees how to acutely understand their client base and drive more revenue in strategic accounts.
Salespeople, front-line managers, and even executives may believe, “There’s nothing we can do to drive near-term revenue or better our chances to win business.” That’s 100% incorrect. With the proper strategy around account and opportunity planning, organizations have the ability to come out on top. The best companies will identify hidden short-term revenue opportunities and position themselves to accelerate their long-term growth as the economy recovers.
Join Sirius Decisions and Revegy in our upcoming webinar to learn more about how to cross-sell and upsell within your key accounts.