Before winning business from your perfect customer you first must determine your perfect prospect. We talked about this process at one of our recent webinars called “Hiding in Plain Sight -Segmenting and Prospect Profiling“.
Materials from our webinar provide a structured, straight-forward approach to helping a company determine which markets and targets are their best fit. Market segmentation is not a sexy practice these days, like say, designing a social media strategy, but it’s one of THE MOST time-tested and important components of building a successful sale plan.
Caveat: A segmentation exercise can become costly and time-consuming, depending on how sophisticated and precise your results need to be, the maturity of your current marketing models, the size of your company, etc. If you are new at it, keep it simple! Don’t get buried in detail or get trapped in analysis paralysis.
Focusing on these 5 critical areas will get you immediate benefit.
- Industry sweet spot
- Target company size
- Type of sale
- Understanding the priority shift
- Target culture
Finding Your Market Sweet Spot
We see a lot of companies focus on segments they want to enter, rather than where they have the most expertise and therefore the best opportunities. A company’s market Sweet Spot is about finding best fit. It is not always in alignment with where a company wants or believes they should sell their services. (Misalignment can happen when no Sweet Spot is defined / enforced and sales reps alone choose where they sell.)
Take a few minutes and review the last 3 to 5 significant opportunities you have won over the last 18 months. Do the same for your losses. What was the compelling expertise or value proposition that made the difference? Prioritize your winning differentiators vs. what kept you from the award. Profile the companies where you won vs. where you lost based on size, relationship, industry, financial position, etc. That profile becomes the basis for your Sweet Spot. Now you can begin focusing on companies matching that Winning Profile.
If you still want to enter a new segment the best approach is to devise a market entry strategy and focus on finding your first anchor client. Just be aware this is a longer, lower probability process and may not yield the results you need this year.
Target Company Size
Segmenting markets by company size creates categories ranging from small business to large, multi-national companies. As part of this analysis also consider the size of your own organization as you select your targets. It can be difficult for small firms to win significant business from large companies that already have preferred vendor relationships. Selling to large corporate accounts is also characterized by long, complex sales cycles because of the formalities of their buying process.
You will need to decide based on the products/services you sell, and how you sell them, if non-U.S. companies should be in your target profile. If so, you can vastly expand the number of companies in your Sweet Spot.
Complex vs. Commodity Sale
Many claim that the Internet has made nearly everything a commoditized, price only sale. That may be true when selling true commodities such as transactional services, packaged goods, etc. If your offerings fall into these categories it’s critical your prospect universe be large because you will have a high number of competitors. As the saying goes, “if you’re not unique, you better be cheap.”
However, if your product or service is more complex, innovative or customized, then your segments can often more selectively aligned to your unique strengths. While this likely means fewer to companies to target, your chances to differentiate your firm are greater and your pricing power should be greater.
Understanding Priority Shift
It goes without saying that working the highest levels in a prospects’ organization helps good reps improve their selling position with key influencers. Just as important is the business priority shift the prospect experienced prior to them ‘taking your call’. That shift, not your splendid elevator pitch, is what has caused them to begin evaluating possible solutions for this new problem they now have. (Read more on this in Ardath Albee’s work and on her blog).
Determining the priority shifts most likely to create opportunities for your company’s offerings is a very important part of the segmentation process. It is what will help you identify the more “lead ready” opportunities versus those leads that fit your Sweet Spot, but are not yet ready to talk. (Keep nurturing them along so that when a shift occurs your company is one they think of as a source for information.)
Many firms pay little attention to their prospect’s internal culture, but we feel culture is key variable in determining future perfect customers. Think back on those wins that seemed to just happen because everything lined up perfectly – even the personalities of the two companies. Compare those wins to ones where the conflict and concessions started long before the contract was signed. Companies have cultures just as much as any other group of people and forcing a bad fit just to close a sale can become very costly.
3FORWARD’s best-fit prospects believe that sales and marketing are highly dependent on each other. They also believe sales is a process that can be measured and managed, not a behind the curtain magic show. Our best clients embrace the changes that are happening in the new world of sales and marketing. Like us they also enjoy working hard and having fun while they are at it!
Summing It Up
As we said at the start, the perfect prospects for your sales funnel may be Hiding In Plain Sight. A systematic process to finding and identifying them, and staying true to your company at the same time, is the way to fill your funnel with the best leads. We encourage you to download our webinar materials on the topic and we are glad to talk if you would like to discuss any of the approaches or templates.