White space opportunity : Your potential areas for growth
White space Opportunity
The ultimate goal of key account management is to recognize opportunities for growth in their strategic accounts. DemandFarm has designed a simple yet powerful framework to identify potential business growth through white space opportunity.
What is White Space?
Are you giving all your focus to new opportunities or keeping an eye on current customers to see if there are any emerging opportunities?
There is a gap between when your sales professional finalizes a deal with a new customer and start fresh with a new prospect. To fill out this gap, did you know that it costs 10 times less to sell to an existing customer than to acquire a new one. The gap between the products or services that your existing customer has purchased and the other products or services that your company has to offer is known as white space.
The goal of this identification is to seek growth of key accounts which is done through existing solutions and relationships. Failure to realize these opportunities, leaves a lot of money on the table and also allows competition to sneak in. These white space opportunities can be unearthed through creation of a visual white space map and it’s careful analysis.
Here is how it works.
Step 1: Identification of Offering
Identify and list down all the products/services/solutions that your company sells to the customer. Let’s call them OFFERINGS. It is advisable to not exceed more than 10 offerings. If your company has more, try to have sub offering classification and club more than one sub offerings to a single parent offering.
Step 2: Identification of Buying Centers
Identify and list down ‘Buying Centers’ in the account. Buying Centers are those units in the account that can buy your offering(s) independently. They could be various divisions of the account or functions in an account or territories in the account. They can also be a combination of these three.
This is tricky. It requires a deep understanding of the account in terms of organizational structure, power centers, decision-making process, budget allocation, etc. Therefore, this step is not static. Buying Centers could change or get added over a while. If you don’t know the account well, it’s ok to start with just one. Since it is tricky, let me explain with an example. Let’s say your key account is a large global bank.
Divisions may include the following: Retail Banking, Wholesale Banking, Investment Banking, Merchant Banking, Asset Management, Wealth Management. Functions may include: Finance, IT, Sales, Marketing, Operations, HR Territories may include: North America, Europe, Asia, Africa, Latin America. Now depending on what your offerings are, Buying Centers could be: Retail Marketing, Asia Operations, IT infrastructure, Asia, Wealth North America.
You get the drift. One thumb rule is Buying Center should be able to independently buy at least one of your offerings on its own.
Step 3: Creation of Account Landscape
Create a matrix/grid using these two lists – Offerings versus Buying Centers. I call it Account Landscape. Here is an illustration.
Step 4: Insertion of Opportunities Data in the Account Landscape
Mark all the areas where you already do business in the Account Landscape with opportunities data. This could be all ‘Closed-Won’ opportunities in the past 12 to 24 months. A view of ‘Closed-Lost’ Opportunities is also helpful to know where you did not win. Also, of course, active opportunities in pursuit now.
Step 5: Analysis of the relevance of Offerings
Examining each offering and deciding its relevance in this account is the next step in white space analysis. Not every offering of yours is relevant to all accounts. It is very helpful if you can also assess the intensity of competition where relevance is high. Similarly, assess each buying center for its attractiveness. A simple RAG (Red-Green-Amber) analysis will do. Look at the illustration below
Step 6: Identification of White Space Opportunities
Now, it will be easy to identify this white space opportunity for business growth. Start with ‘Green’ boxes and see vertically and horizontally where growth can happen. There could be opportunities to ‘mine’ for more revenue in existing projects. In the illustration above, I have identified 3 of them. Highly relevant offering with highly attractive buying centers gives me two of these opportunities.
It also helps that we are already engaged with other offerings in these buying centers. As you can see, a methodical approach to unearthing new opportunities to grow your accounts as illustrated above is very impactful. At DemandFarm, we have made this process easy by building these tools inside your CRMs.
We believe that the Account Managers are the heroes. Their expertise, experience and domain knowledge is what matters the most when it comes to handling key accounts. So at DemandFarm, we try to do our best to equip them with tools and frameworks to help them visualize better and to make their thinking strategic, focused and cohesive.
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About the Author
CEO & Co-Founder, DemandFarm
Milind is CEO & Co-Founder of DemandFarm. Having practiced and evolved the ‘account farming’ principle for over a decade he established DemandFarm and is passionate about delivering the best B2B key account management tool to serve the needs of key account managers. Milind also serves on the Board of LeadEnrich & is a Strategic Adviser.