It is easy to underestimate the value of a deal. When you enter an opportunity into your CRM, the value tends to be based on the contract you are negotiating or your prospective clients annual spend in your category. What those metrics overlook is the lifetime value of the prospective client, should you win their business in a way that allows you to be something more than transactional.
If, for example, your company keeps the clients it wins for seven years, then a $1 million annual spend is really $7 million if they are retained at your average retention. The reason this concept is important is that it provides a different context for how you pursue your dream clients. This is not to say that a $1 million account isn’t going to be worth your time and attention, but that a $7 million account will provide you with a different level of focus and intention in your pursuit.
Playing to Win. Big.
If you are playing for $7 million, you may be much more thoughtful and planning every interaction with that prospective client, ensuring that you create the requisite value to earn the right to continue on in the process of helping them change. Instead of winging it, believing that you have made hundreds-if not thousands-of sales calls before and that preparation is unnecessary, you will give your plan the time and attention it deserves.
When you take a longer term view of the value of the deal, recognizing that $7 million may require more of you, you will spend more time with your leadership team, with your manager, and with your operational team building the best possible solution, differentiating yourself from your competitors, and putting your best possible offering in front of your prospective client. You will spend more time strategizing to ensure you have a plan to win, and you’ve done everything in your power to mitigate the possibility of a loss.
More than anything else, you will spend more time with your prospective client, and that time will help you build consensus within the organization and resolve their concerns, giving them the confidence that you are the right partner to help them with the change initiative you are proposing. In a world where everyone hides behind three screens, having a presence is a differentiator in a competitive advantage.
Playing for Keeps
It’s not that $1 million isn’t a large deal; it most certainly is. But a $7 million deal is even larger, and it provides you with a greater focus when you recognize the greater stakes for which you are playing.
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Filed under: Competition