Let’s face it – you most likely didn’t work hard to develop your professional service skills and expertise because you wanted to be a sales person. That said, you probably also realize the importance of developing new business so that you can continue to practice your professional skills — it’s a conundrum.
What if I told you the most effective business development tactic you can employ is also the easiest AND least expensive? I’m guessing you’d want to hear more — so here goes. I’m talking about mining your existing client data to identify business development opportunities.
The Tried (and True!) 80/20 Rule
Start by listing your clients in order of the fees they pay you annually — highest to lowest. Then look at the top 20% on the list and calculate what percentage of your total revenue they represent. I’m pretty sure you’ll find that top 20% of your clients represent close to 80% of your revenue. It never seems to fail!
So take a look at those top clients – what makes them your “A” clients — what industry are they in, what size companies are they, is there anything different about the way you serve them? Have you asked these “A” clients for a referral and/or testimonial? They obviously trust you and depend on you for a significant level of service — they will be your best introduction to meet prospective clients.
Based on the profile of your best clients, what types of business development activities should you be doing to bring more of those into the firm? What professional organizations, publications, web sites, etc will put you in front of companies who match the profile of your “A” clients?
Now take a look at the next tier of clients — many times they represent significant growth opportunity. What can you do to move them up to the “A” list? The first step is easy – call them to schedule a lunch or meeting and catch up on their business.
Now take a look at that bottom 80% or so that are only accounting for 20% of your revenues. How many of them are there? What is the average annual fee/client? How profitable is it for you to continue to serve all of these clients? Is it worth referring some of these clients to smaller firms to free up your time to develop and serve more profitable clients?
Develop an Opportunity Matrix
Once you’ve identified your “A” clients and the next tier below the “A”s we’ll call them the “B”s — develop a simple matrix to identify where you have cross-sell opportunities. List these clients down the side of the matrix and list all of your firm’s services across the top. Fill in the cells with one of four statuses:
- Providing/provided — you are already doing this service for the client (or have already done it if it’s a one-time project)
- Proposing — you are already in discussions with the client about providing them with the service
- Not applicable — you can’t provide the service for the client because you are conflicted out our because there is no need for the service based on the nature of their business
- Opportunity — everything else!
Don’t make decisions for your clients, assuming they don’t want a particular service. Anything that isn’t in the first three categories — the Not applicable should only be used for truly non applicable services — should be considered an opportunity.
The opportunity matrix will help you prioritize which clients to meet with (those with the most opportunities) and what to prepare to discuss with them (the services you haven’t yet provided them).
Remember, cross-selling to clients is the quickest, easiest, least expensive way to develop new business. Use your client data to identify the right clients and right services to target for growth.Â And even though you can’t rely solely on client cross-selling for growth, the data you have about your existing clients can help you identify the right prospects to target and help you meet them through referrals and testimonials.
See? It doesn’t have to be hard — you have what you need right at your fingertips. Good luck!