For years, sales reps at a leading chemicals and services company had successfully worked their territories, but in recent months sales volume had plateaued, because of encroaching competitors and shifting demand. Using its emerging analytics capability, the global firm took a more granular look at its business. It diced its seven U.S. regions into 70 "micromarkets" and zeroed in on those with the greatest potential. It then pulled reps away from overserved territories, created sales "plays" for the newly identified hot spots, and redeployed the sales force. Within a year the sales growth rate doubled—without an increase in marketing or sales costs.
The key to the firm's remarkable turnaround was its new ability to combine, sift, and sort vast troves of data to develop a highly efficient sales strategy. While B2C companies have become adept at mining the petabytes of transactional and other purchasing data that consumers generate as they interact online, B2B sales organizations have only recently begun to use big data to both inform overall strategy and tailor sales pitches for specific customers in real time. Yet the payoff can be huge: As a sales executive at the chemicals company told us, "There's no need to rely on intuition and guesswork anymore."
To understand how sales organizations are beginning to use big data, we interviewed 120 sales executives at a range of companies around the world that have significantly outperformed their peers in revenue and profitability. These in-depth conversations suggest that micromarket strategy is perhaps the most potent new application of big-data analytics in B2B sales. While micromarkets are most often understood as physical regions, they needn't always be; as we'll describe even an air-cargo route can be a micromarket. Discovering and exploiting new-growth hot spots involves three steps: Defining your micromarkets and determining their growth potential; using these findings to distribute resources and guide the sales force; and incorporating the big-data mind-set into operations and organizational culture.
Read the full article on the Harvard Business Review site