How to spot hidden opportunities for sales growth

By Andris A. Zoltners, PK Sinha, and Sally E. Lorimer for Harvard Business Review:

In the hunt for sales growth, profit growth, or share growth from the sales force, every sales leader, whether new or seasoned, whether from a growth-stage or a mature-stage company, faces the same question. Where will the growth come from?

The best answers are frequently unearthed by looking at differences in performance, sales activity, and market potential across different pieces of the business — certain customer segments, selected products within a broad portfolio, or specific groups of salespeople. Better analytics, as well as improved data storage and organization technologies, are enabling companies to get more creative in the way they analyze data to discover and take advantage of these hidden pockets of growth.

Here are several examples:

A manufacturing company accelerates growth among new hires. A manufacturing company tracked performance of salespeople over their first 20 months with the company to understand how quickly new salespeople became effective and why. A key finding was that the quality of the first-line manager (FLM) had a large impact on new salesperson performance. Salespeople reporting to top-performing FLMs performed much better in their first 20 months on the job compared to salespeople working with average-performing FLMs. Top-performing managers did two things that contributed to the performance difference: they spent more time coaching in the field and they arranged for mentorship from experienced team members. Based on these findings, the company established new coaching expectations for FLMs and implemented a tracking system to ensure accountability.

A telecom company gets more business from its low performing, high potential customers. A telecom company took advantage of an emerging way to hunt for opportunities by using a collaborative filtering model, similar in concept to algorithms used by companies such as Netflix and Amazon. The company found “data doubles” for low performing, high-potential customers – i.e. other customers who had a similar demographic profile (for example, the same industry and scale), but who were buying much more. The company analyzed the purchase patterns and sales strategies at these more-successful data double accounts and shared the insights gained with the sales force. The information enabled salespeople to improve targeting of the right products for under-performing customer accounts, thus driving stronger uptake of new product lines and dramatically improving the realization of cross-selling and up-selling opportunities.

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