We've reached the midway point in 2016 and now's the perfect time to reevaluate -or even re-think -your current growth strategy. Traditionally in our industry, business growth has been built around gaining market share: adding new logos, making more deals and fueling the sales pipeline.
"Being successful in this new economy increasingly requires that companies actively manage their customers during their engagement relationship, instead of just focusing on making the technology sale."-Forrester Research
But we all know it's more costly to land new customers than it is to retain existing clients. Experts say it's as much as 15% more costly. And as the subscription economy continues to transform the world around us, "customer share" is emerging as the growth strategy that makes the most business sense today.
What is customer share? It's a growth plan geared toward earningmorerevenue fromfewercustomers - as opposed to looking for growth from more new clients. Instead of focusing your sales team on new logos, the emphasis is on expand selling and growing customer lifetime value (CLV).
Initial Sale = 5-30% of revenue
Post Sale = 70-95% of revenue
-Source: Totango, Customer Success Putting the Pieces Together
As trust is built with existing customers, new and more valuable opportunities often arise with them during post-sale engagement. In fact, Totango says up to 90% of a company's revenue can be generated in the post-sale phase. That's because the ability to upsell, cross-sell and expand a client relationship becomes much easier when a trusted partnership is already in place.
Expanding relationships with customers isn't always automatic, however. We have to work at it and stay focused on how our technology can help the customer achieve their preferred business outcomes. With that in mind, here arefive tips for increasing wallet share with existing clients:
As you rethink your growth plan, it comes down to this: when picking a strategy, do you want to invest in acquiring more customers, or in making sure that your existing customers keep buying more from you?
To find out more about growing customer share, visit SuccessHub.