Growing Share in Your Core Markets
More and more frequently, B2B companies are making it a strategic priority to grow in core markets by growing share with top customers. In discussions with executives across many B2B industries around building share in core markets we have heard the following:
- We need to grow recurring revenue by strengthening relationships with top customers and capitalize on our extensive installed base.
- We must enhance our customers’ experience by tailoring our solutions their needs.
- Accelerating growth with our most important customers is a top priority, and we plan to do so by increasing customer focus.
- We are focusing on value-added offerings and services to deliver a customer-focused experience.
In a strong economy, significant growth opportunities arise in core markets, tempering the need to seek growth through aggressive expansion into adjacent markets, new businesses or bolt-on acquisitions. While these pathways to growth can be attractive and interesting, they present additional risks which are not present when focusing on growth in the core. Risks include standing up new and unfamiliar business models, accessing new channels and customers, and developing new methods for creating value. Focusing on the core avoids these risks.
Strong relationships with top customers can be a way to shield risks in a slowing economy. As we have written in a recent white paper, What’s Your Recession Playbook, these relationships can sustain your business or even drive growth through a downturn.
With this increased focus on core markets and key customers, we have observed common shortcomings in execution of this approach. These typically fall across four categories:
- Prioritization: Failing to segment markets and identify the most important customers. The result is a lack of focus on customers where you have the best opportunity to grow wallet share
- Relationships: Not building deep relationships with key stakeholders throughout these important customers. Often, this leads to purchasing becoming a gatekeeper and roadblock.
- Customer Focus: Disregarding a customer-focused approach. By not fully understanding the key issues customers are trying to tackle, there’s no insight into how you can solve them.
- Planning & Execution: Not having a clear understanding of steps that must be put in place to address customer needs, create deeper engagement, and demonstrate your added value .
By enhancing prioritization, effective relationships, deep customer focus, and strong planning and execution, we have seen clients achieve substantial success with top customers.
Related Reading – Mitigate Your Growth Risks: A Guide to Building Share in Core Markets
A client of ours, an ingredient supplier to the architectural and automotive coatings industries addressed their approach to a major customer across each of these dimensions, and within a year grew annual revenue with this customer from $300k to $1MM. Keys to their approach were:
Prioritization – By studying their key customers, they were able to determine the total wallet available and strategic alignment probability for each one. With this, they de-emphasized some customers and focused resources on others.
Relationships – They mapped the current state of the relationships they had with their top customers, and typically found little contact beyond purchasing. They created purposeful engagement plans to build relationships with key stakeholders across functions, including marketing, product development, and engineering, to become stronger partners and further demonstrate value.
Customer Focus – They worked with Blue Canyon to fully document and map their top customers’ buying processes and desired experience; then identified steps along the buying journey where their offering could provide substantial value for their customers.
Planning & Execution – They developed an account plan which included six specific initiatives to execute with timing and accountabilities along with clear-cut goals and KPI targets. In addition, they set specific expectations to be involved in more product trials and testing early in the process.
In the search for growth, at times, the best play is to focus on the core and grow wallet share with your most important customers. Often there is ample room for growth in this lane, and our clients have demonstrated proven results from following this approach. In addition, it can be a good hedge during periods of economic uncertainty.
 Birkir Larusson and George Mokdessi, What’s Your Recession Playbook? Blue Canyon Partners, Inc. ©2019