As part of the due diligence process during an acquisition, it is typical for the investor to reach out to top tier customers. The purpose is to determine how satisfied and loyal these customers are to the company and if any of these customers are at risk of scaling back or leaving. But, what could you be missing by only focusing on the top tier?
Focusing on top tier customers is important to provide a level of certainty and guarantee to the acquirer, however, incorporating a more thorough approach can provide you with a plan of action for growth vs. a handful of data points once the deal is done.
Here are three steps to follow that will enable you to gather the right insight to accelerate customer relationships once the ink is dry.
1. Go beyond the top tier customers …
Yes, the certainty of top tier customer relationships is critical to stability and sustainability of an organization. However, by skipping the rest of the customers you may be overlooking major opportunities for growth. Mid to lower tier customers often have more potential but these accounts typically don’t get as much attention. In a recent project, we found that the lowest tier customers were the happiest and wanted to buy more products from the company, however, they couldn’t ever get a salesperson out to meet with them.
2. Make sure you know who is satisfied…
Identifying which customers are satisfied and are promoters of the business will enable you to drive more sales with these companies. Consider the behaviors of promoters– they buy more products and services, they are less price sensitive and they positively promote you to others. Knowing who your promoters are will enable you to design sales and marketing strategies to sell them more.
3. Ask the right questions to identify growth opportunities …
Simply knowing who is happy or satisfied is not enough for you to build a growth strategy. Go beyond the satisfaction score to understand how their business has changed over the last few years, their intention for future investments and contract renewals. Also, make sure they are aware of all the products and services you offer– you’d be surprised how many customers don’t know the full breadth of your offerings.
So don’t stop short! Put a plan in place to drive customer acceleration during due diligence and gather the insight we discussed to drive a comprehensive sales growth plan you can have confidence in.
And if you’d like some help, please reach out at (216-876-1165) I’m happy to help you get started. If you’d like to watch a video on this topic, visit Elite Experts Network.
