Business Growth Strategies: “Farming”

In many businesses, the sales team is split into two parts, the “hunters” and the “farmers”. The hunter’s goal is to find and win new business, or what you would think of as a more traditional sales person. The farmer’s goal is tend to existing relationships, make sure the customers are happy and basically to up sell.

Based in a Boston venture capital firm, I speak with a lot of companies looking for innovative business growth strategies. One of the trends that I keep coming across however is very simple: focus on your existing business and offer them more. One way is to offer them additional products or services that they could benefit from which may mean going back to R&D to create some add-ons.

One cheap way to get your existing customers to buy more is to offer promotions or discounts based on volume. Groupon, a hugely popular tool, is an excellent example of this. If a spa wants a quick way sell 1000 massages in a day or a rock climbing gym wants to sell 800 lessons, or a new restaurant wants to get their restaurant packed quickly, Groupon is a tool that offers them an easy way to do this. Now, think if you gave this option to your customers. You could put an offer out to all of your customers if “X” amount of product was sold, they would all get a 40% discount. Like Groupon, you could let them track this to see how close the number was to closing. You would have me make sure the discount worked so if the number of product was sold, you’d still make a good profit based on your typical sales cost and customer acquisition cost. If sales did not reach the number you wanted, you could offer a 20% discount or whatever discount would still ensure a profit.

This process could also double as a lead generation system via word of mouth marketing. Groupon does not advertise, but WOM, a phenomenal form of inbound marketing has led to explosion. Your customers will most likely be in the same social circles, groups, attending the same conferences, etc. and if you offer big discounts in an exciting way, people will talk.