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Vertical market software, $8 million in sales
Primary question the client wanted
answered:
“How badly am I going to be attacked by customers at
the upcoming User Conference?”
This was a reasonable question. The CEO had been focusing
on an internal aspect of the business while the company started
springing leaks in areas that directly affected customers.
He’d gotten plenty of warning that customers weren’t
happy, and he’d begun plugging the dam, but had that
been enough?
What we found out:
The customers could see the CEO had begun focusing on their
issues. They were willing to give him the benefit of the doubt.
However, in their opinion, his vision of the company was too
small. The company had started as a consulting firm but seemed
to refuse to make the leap to software vendor status. Most
of the customers were Fortune 50 companies, and they wanted
this vendor’s sophistication to grow to fit in their
league.
How business was affected:
What a wake-up call! We are very proud of our role in hearing
what the customers were saying and putting the complaints
and recommendations into terms the CEO would act on. The CEO/founder
began hiring into the leadership team from the outside for
the first time in the company’s nine-year history. They
overhauled their customer service performance and began down
a growth-by-acquisition path impossible under their old leadership
structure. There’s no question they are in their customers’
league now.
How revenue was affected:
This company successfully weathered stormy downturns in their
industry and recently attracted venture funding set aside
for new acquisitions. Customers are solidly on board with
this vendor. |
On-site outsourced services, $10 million annual services contract
Primary question the client wanted
answered:
“Have we proven ourselves well enough to win a renewal
of this multi-year contract? If not, where are we dropping
the ball and how can we turn things around?”
This vendor was on-site with a customer whose industry was
new to them. Not only were they sincerely interested in earning
renewal of the current $10 million annual contract, they wanted
to know if they were perceived as ready to approach other
prospects in the customer’s industry.
What we found out:
On the whole, the vendor’s performance was fine, and
progress up the learning curve was applauded as swift. However,
there was a laundry list of details they were going to have
to get right before the contract renewal could be guaranteed.
How business was affected:
The vendor took their customer’s suggestions to heart
having previously overlooked the gravity of some of the “laundry
list” issues due to their inexperience in this industry.
How revenue was affected:
The contract extension was signed and the vendor received
hearty praise during reference checks from this customer when
the vendor bid on new accounts in the industry. |
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Hard-goods remanufacturer, $4 million in sales
Primary question the client wanted
answered:
“Which of these services do customers want us to add?”
This vendor competed shoulder to shoulder with a large number
of competitors with similar products. The president and marketing
manager thought adding services would help differentiate this
company from the pack. Before they added a services arm, they
wanted to make certain their assumptions were correct.
What we found out:
Which services did customers clamor for? None of them! This
company didn’t understand how their customers made the
vendor-selection decision at all. Customers liked this company’s
integrity and people, but all of the competing companies were
leaving mountains of money on the table ignoring where the
real growth in demand was!
How business was affected:
We listened carefully to what the customers were saying, and
summarized their demands for our client. Being the only competitor
who bothered asking customers what they really wanted gave
this vendor a huge advantage. They retooled their offering
to match their customers’ full spectrum of needs. They
are a completely different company today.
How revenue was affected:
Sales took off! They broke away and are no longer an also-ran
in their industry. |
Turnkey and component manufacturing, $50+ million in sales
Primary question the client wanted
answered:
“What do our customers think of us?”
The newly promoted CEO and newly promoted VP of Marketing
felt they were flying blind with no customer feedback on file
whatsoever. They weren’t willing to make growth plans
without knowing something about their customers’ attitudes.
What we found out:
This started out as a routine “customer feedback study”
but quickly became a strategic planning tool. When we looked
at the source of the positive and negative feedback we heard,
a pattern was clear. Large turnkey customers felt this supplier’s
quality was high and often used this vendor exclusively; smaller
component customers felt quality was inconsistent, often demanded
rework, and were forced to have back-up suppliers. Until this
came to light, the company had been proud that it serviced
all comers. However, the opportunity cost of trying to service
such a broad mix of accounts cut into this company’s
revenue potential. Apparently it was time to redefine who
they were.
How business was affected:
Feedback from the customer base allowed this manufacturer
to recognize its strengths and realign its business accordingly.
It referred away its smaller customers to competitors and
retooled its message, marketing and growth plans to appeal
to larger prospects. The company invested in the equipment
needed to round out product lines targeted to large-volume
customers. They also redeployed the sales staff to focus exclusively
on large-account sales.
How revenue was affected:
Revenues grew rapidly. Three years later this firm was acquired
by a multi-national corporation. |
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Vertical market software, $7 million in sales
Primary question the client wanted
answered:
“Can our customers help us with marketing ideas?”
The company’s new president had presided over the development
of ambitious growth targets during his year with the company,
but the company’s expensive marketing program wasn’t
generating new leads. The sales and service teams had given
him the impression the customers were supportive of the company;
maybe happy customers would be willing to offer marketing
ideas.
What we found out:
Far from being supportive, the customers would have dropped
this vendor for the competition if the software installation
process weren’t so daunting. Of the twenty-eight customers
interviewed, twenty-six didn’t have anything nice to
say about this vendor! The heavy-handed president had come
from another industry and didn’t understand how to work
with this vertical market at all. In retrospect, it turns
out the sales and service teams had sugar-coated their anecdotal
reports of customer satisfaction to please the overbearing
executive.
How business was affected:
The founder/chairman hired a new president, and we were brought
in for a second engagement a year later to re-interview the
same twenty-eight customers. The findings: this president
was a hit! Customers were very supportive of the change in
leadership and the company’s new direction. Many offered
marketing ideas to help this vendor grow sales now that there
was a mutual sense of goodwill.
How revenue was affected:
The customers knew what they were talking about. Relevant
marketing ideas led to fresh leads which led to new sales.
This company began down a growth path that attracted a buyer
two years later. |
Specialty printing, $6 million in sales
Primary question the client wanted
answered:
“Can the customer base help us improve our sales process?”
The bottom dropped out of the economy after this company
invested in new plant and equipment, but their sales and marketing
programs wouldn’t scale to fill the gap. Customers had
always been an excellent source of referrals: what could customers
tell them about actively seeking relationships with new prospects?
What we found out:
Customers loved this company and offered comments that led
to specific winning sales tactics and a revised unique selling
proposition. The old USP hadn’t reflected key differentiating
features of their offering and made them sound like every
other printing company that called prospecting for business.
How business was affected:
Customer feedback helped this company take sales and marketing
to a new level.
How revenue was affected:
They won the very next project they bid on using tips from
this project! (The margin from that one sale covered our fees
in less than one year.) |
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