Know-How Exchange : Customer Behavior

Do you have a customer service department? If so, proactively have them call to ask about their most recent order to find out what problems they may have had. Your goals is both to improve your customer service AND to find out more about your inactive customers.

Also, why not do your homework on your 10% customers prior to reaching out to them. If they are public companies, how has their stock been trading? What are they saying in their newsletters and blogs?

You say you have a national sales force of 600. Are these employees, or manufacturers representatives?

If their employees, are they straight commission, or base plus commission?

Thank you for providing more information. It is very difficult to provide accurate advice with just a thumbnail sketch of your situation, but I would point out that you have to be very careful when you select a compensation program, because you generally get what you incentivize.

Many salespeople work by the 80/20 rule. In other words, 80% of results come from 20% of clients. Since your sales force is on straight commission, you should expect them to be as efficient with their time as they can, and to focus on their best prospects.

If I were in your situation, I would solicit the advice of someone with years of experience in salesforce compensation. I think you are right to be cautious about stepping between the sales reps and their customers. But I'm concerned that it would not be prudent for you to provide detailed information on your company and market and salesforce to an open forum such as this, and without such detailed information we can not provide a truly accurate answer.

If you twisted my arm and asked me to take a best guess, I would suggest that you focus on finding new hot prospects for your sales force, and count on them to use their own time efficiently and to best advantage.

I think the best way to deal with this situation is to help your sales force to become more effective. NoStressXpress made a good point in noting that customers leave because their needs are not being met. Therefore, the best help you can provide your sales force is to provide information regarding the specific needs of the segments they serve, in priority order. This can be done with a market research project that results in a market segment value model. Such a model will identify the critical-to-quality factors, their relative imortance, and your performance on those factors. The research will also provide the performance of key competitors in each sales person's territory, and will identify performance gaps. Most importantly, this research will provide a Customer Loyalty Matrix that identifies customers at risk of defection, and the bases for that risk. If you link that Loyalty Matrix to your financial data, you can even provide your sales force with the dollar revenue at risk. This type of information provides its own inventive to your sales force, because it leads directly to increased commissions, without having to change your compensation scheme.

You'll find more information about how to do this research in one of my recent books, "Competing for Customers and Winning with Value," available at Amazon. Or you can contact me directly using my profile.

Hope this helps. This approach has been very effective with other manufacturers and distributors going to market through a dedicated or independent sales force.

Reg