The company was a leader in the market, with technological advances that had deep impact on its customers. It attracted great employees, who were eager to be part of its future.
The Rock Star Salesperson
One of the company’s new hires was a salesperson who was considered a rock star. With a strong track record for acquiring new clients in previous positions, they delivered the same results for this company as their new employer. They helped to shape client contracts and were focused on getting as much out of each customer as possible. In hindsight, this should have been a tipoff of things to come.
The rock star salesperson continued to add new customers each month; yet, there began to be a simultaneous and steady flow of customer departures. Over time, the company’s staff became disillusioned with the customer outflow.
The Revenue Impact
In addition to the cost of losing customers, the cost of bringing on new customers was impacting the company’s EBITDA.
What would appear to be a great asset (new customers) was offset by a costly liability (having to constantly generate more new customers).
The business owner was sure it was the company’s competition finally catching up with them and attributed the exodus to factors of competition.
As time went on, employees became even more disenchanted, and there was soon a revolving door of new staff coming in as experienced staff left – a churn pattern similar to customer loss and acquisition.
Finally, at a fund-raising luncheon, the business owner ran into one of his former customers and asked why they weren’t doing business together anymore. The customer candidly shared that the rock star salesperson really nurtured their relationship when they were looking to “hook them,” but that, once they did, the sales rep became ambivalent and, at times, confrontational.
The salesperson was eager to sell but not looking to serve.
The customer recognized very quickly their needs were not being met, that they were just being “sold,” not served.
As such, the company-customer relationship deteriorated to a point where they finally said yes to a call from the company’s competitor. For over a year, the competing company was serving them in a way that far exceeded their expectations.
The business owner realized that his rock star sales rep was, slowly but surely, eroding the business because the rep was gifted at landing new clients, but horrible at building deeper relationships with customers. His rep was playing, as Simon Sinek would say, “a finite game.” A finite game is a game where you merely win by landing a certain number of new clients. Business – big business – is built on an Infinite Game.
How could this costly mistake have been avoided? More importantly, how can you prevent this costly error from happening in your business?
- When hiring sales reps, look beyond sales to service – check references of their customers.
- Use a behavioral report such as the Maxwell Method of Sales Impact Report to identify the selling strengths and challenges for your top candidates.
- Once you make the hire, spotlight and reward both new customers and nurturing of client relationships. Customer relationships should be treasured, with customers served, not as vendors but as partners in the success of your organization.
How are you and your team treasuring customer relationships?
Do you know the selling strengths and challenges of your sales team?
Do you see an infinite game ahead?
As the CEO of Strength Leader Development, Deb Ingino is a highly sought-after international executive mentor, coach, trainer and speaker. Deb is well versed in global business operations and helps business leaders and their teams to discover and leverage their strengths, so they can create highly collaborative teams that deliver great results. With a refreshingly direct style, Deb helps leaders and their teams to deliver profitable results. Connect with Deb to learn more about her mentorship and coaching programs to equip you with advanced strategies to elevate your results.