Ever tried calculating your total market potential? Definitely a useful exercise! In order to do this, you must first know how many potential customers you can sell to. Based on our experience, we can assert that almost every organisation has insufficient knowledge of around 20 percent of their market. Not because the sales or marketing department aren’t doing their jobs properly, but because there are simply too many organisations with ever-changing structures; too much to keep up with.

Additional business potential is invariably present below the surface, just waiting on a call from your company.

And what’s your average margin per deal? If you multiply this number with that 20% of customers, then you get a good idea of what you’re missing out on.

Expanding the Top 100

Let’s take a brief look at a fictional (yet definitely not unrealistic) example of a company that works with a Top 250 of accounts, based on own efforts. Suppose this company realises an average margin of €20,000 per customer on an annual basis. If you were now able to expand that Top 250 with a further 50 organisations, this would tap into an additional potential of one million Euros of extra profit.

Before you discount this out of hand, I would recommend reviewing your Top 250 list and searching for the gaps. Find one missing account, and you can be certain that there are many others.  Consider the yield if you were to supplement your CRM system with that 20 percent of missing prospects. I’m certain that every self-respecting independent database specialist would gladly take on the challenge of demonstrating how your list compares to reality and what it yields.

The right addressable market

We can also turn this around. Do you ever wonder how much time, money, effort and missed sales it costs when you target the wrong accounts or the wrong contacts in the right accounts? You will encounter many complex and hierarchical organisations, particularly at the high end of a market. Many of these companies have dozens of locations. Which ones will you target?

It’s now well-established that you must speak to more than just one head-office based CIO for a B2B purchase. Perhaps the key stakeholders are located elsewhere, or the decisions are taken by others. What if you don’t know who and where these important stakeholders are? How much does it cost if your sales team or call centre continually call the wrong people? Compare that with the cost of purchasing a quality database, in which you first clean up and enrich the list before calling again. In this context, the picture below is extremely illuminating. For why would you dedicate your most expensive people and most expensive hours to the least profitable part of the work?

I can’t think of one good reason. Can you?

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