Why Your Sales Reps HATE Dealing With Existing Customers….

Because they don’t get paid to do that…

It’s an argument as old as the hills – do you staff your sales team with hunters (those that seek new business only) or farmers (those who maintain relationships with existing customers, focused on sales to existing base and retention), or do you have both in clearly defined roles?  Why?

FOT friend Ann Bares recently threw up some data from the Harvard Business Review related to the shortcomings of structuring your sales function with separate roles for hunters and farmers.  Among the downsides cited from Ann from the Harvard Business Review:

• It rests on the assumption that the business of selling to new customers is transactional rather than consultative; hence, it is easy to "hand it off";
• It assumes that the skills required for the hunter and farmer business development roles are fundamentally different;
• It assumes that there is more business to be had from new than existing customers – not always the case;
• It trivializes the cost of the hand off from hunter to farmer; and
• It disregards that the hunter may leave a fair number of "loose ends" since they don’t have to deal with the consequences of on-going customer relationship.

That’s a pretty good list of reasons to avoid distinguishing between hunters and farmers in your sales organization, plus it comes from the Harvard Business Review, so who are you to disagree?

So, we said the obvious.  Now, let’s talk about what’s real.  Here’s the reality (which I know Ann has seen as well) for a lot of companies that move to two separate roles for "hunters" and "farmers" within their sales organizations.. I’ll even break it down for you, in the order of events experienced in companies, that decide to migrate to the hunter vs. farmer:

1.  Most companies begin with one sales role, with individuals who both hunt and farm.  Life is good for awhile.

2.  As the company builds a book of existing customers, the load put on each sales rep related to existing customers continues to grow.

3.  As the existing customer burden (think involvement and resolution of service issues) continues to grow, the sales force experiences misses in new customer acquisition vs. budget projections.

4.  The company views the existing customer burden as an "excuse" to the sales reps hitting their new customer numbers, and eager to remove the barrier for the sales rep to get new customers, recruits and staffs a group of "farmers" to deal with the existing customer base from a sales and retention standpoint.

5.  The performance of the pure sales reps, now known as "hunters", improves quickly as they’re now able to go hunt new business, top line growth which is key in any industry.

6.  The company, hustling to survive and hit revenue projections, politely nods at the logic included in the HBR study, then continues with the hunter and farmer model.

And that folks, is the way it is in companies that use and support the hunter and farmer model.  They acknowledge all the good stuff included in the HBR study, they just don’t have 3 months to plan, train and redeploy their sales force, and then "hope" it sticks.  They’re trying to MAKE THE NUMBERS….

When it comes to top line revenue growth, most companies will do what it takes to remove excuses barriers related to making the revenue budget…

Always be closing….