5 Reasons Why it is Important to Analyze and Manage your Client Portfolio

By Ivanna Nösel
Published: 12/18/20
definition backgroundProfit and loss statement vs balance sheet: The key difference

Client Portfolio: why is it such an important asset for companies? 6 tips to improve it and optimize Sales Management

The customer portfolio is one of the most important assets that your company can build: the customer is king! Without customers, there can be no profit.

Having a well-stocked customer base is therefore a sure guarantee for the future of your company. And the more it develops, the greater the prospects for long-term sustainability.

In order to optimize sales management, a well-structured customer base is essential.

What is a client portfolio?

The client portfolio consists of all the information about the clients working with the company at a given time:

  • the complete details of the company and its contacts;
  • the signed projects and their characteristics;
  • the history of the exchanges made during the prospection process;
  • other relevant details about the clients.

The following information is not present in the portfolio:

  • leads and prospects,
  • old clients,
  • business partners.

You can choose to break it down into several portfolios, each associated with the relevant salesperson (or project manager).

You can also segment it according to criteria relevant to the business:

  • industry,
  • size,
  • type of contract,
  • etc.

Why is it important to analyze your client portfolio?

Essentially, for 2 reasons:

  • you will always find it easier to convince one of your customers to repeat a purchase (as opposed to convincing a new one);
  • you will be able to better organize your sales and your commercial roadmap.

Increasing your customer base is therefore of paramount importance for your company. Here are 5 tips to put into practice to develop it.

#1: Put customers first

Your company's best salespeople are your own customers. That's why your customer base is such a critical asset. You can ask them to:

  • introduce you to other people potentially interested in your services;
  • make a video (or write a text) in which they tell you about their relationship with your company;
  • be the subject of an in-depth case study about their experience with you.

👆 Your future clients are definitely in the acquaintance circle of your current clients: all you have to do is solicit them.

#2: Focus on customer loyalty

We often have a tendency to mistakenly believe that a customer is acquired ad vitam aeternam. That, after winning it, the hardest is behind us. However, the reality is quite different: keeping a good customer is a perennial challenge for companies.

To grow your portfolio, you must first strengthen it. Make sure your customers are loyal to you. Here are a few tips for a great customer experience:

  • Surprise your customers by delivering a quality service that exceeds their expectations.
  • Show them a deep interest. Deal with their problems on a daily basis and work to resolve them.
  • Enthuse them by offering them solutions adapted to their personal context.

👆 Never forget that before selling to companies, you are selling to human beings first.

#3: Consistently generate new leads

Before becoming your customer, a company or an individual represents a prospect, entered within your business process. But before being a prospect, this same person/company is a lead, which you must try to place within the process.

Constantly generating new leads is by no means simple. It means constantly attracting new people who don't know you at all, in a world of constant solicitations.

For this task, you can:

  • bring value by way of an inbound marketing strategy;
  • attend professional trade shows.

Your sales department must constantly have new leads available in order to begin the prospecting process: qualifying leads, setting appointments, door-to-door selling and so on.

You can also use social media to track users' intent data to get better insights.

Tips: Find out how to generate best lead by following our b2b sales lead generation and lead generation in digital marketing guide!

#4: Leverage Social Networks

The business development of your activity is first of all a matter of networking.

It is therefore essential to be present (and active) on social networks, in order to:

  • be recognized,
  • increase leads,
  • get recommended,
  • bring value,
  • make appointments,
  • actively monitor competitors.

👆 A good salesperson must be active and dynamic on social networks.

If you work in a B2B context, it's essential to verify if your B2B sales cycles and B2B sales funnel are still on a good way.

#5: Refine your customer base

Although it may seem contradictory, to develop your portfolio, it is important to get rid of some customers

Are you familiar with the Pareto principle, also known as the 80/20 law? About 20% of the inputs determine 80% of the outputs. Concretely, this means that a small percentage of your customers determine most of your revenue.

Furthermore, it can be argued that: "20% of your customers consume 80% of your team's time and energy."

And if these customers aren't part of the most profitable ones, the problem is obvious.

Growing your portfolio takes time and energy: generating leads, prospecting, selling, retaining. If your sales managers don't have time to devote to this, it can be a problem. 

Once you've identified your least important customers, you have two options:

  • reduce the time devoted to them,
  • discreetly turn the customer away.

👆 So your salespeople can devote more time to higher value-added activities.

Make sure to balance your CAC customer acquisition cost by checking your budget and customer lifetime value calculation.

How to analyze your client portfolio

How to choose the best sales KPIs and metrics is still more of a skill than a science. In this context, customer metrics should reflect each different purchase, while sales KPIs should focus on the actions the B2B sales team can take to manage these customer journeys more effectively.

There are declining, leading and advanced customer metrics and sales KPIs to consider. Examples of customer metrics include:

  • customer awareness,
  • website visits,
  • clicks,
  • product usage,
  • lifetime of a customer,
  • demographics,
  • profitability of each customer,
  • etc.

Examples of sales metrics include:

  • average deal size,
  • number of sales activities,
  • win rates,
  • loyalty scoring,
  • churn risk,
  • unmet sales potential,
  • marketing audits,
  • pricing opportunities.

A good client portfolio manager can help you out. But if you do it on your own you will need a table list consisting of 2 columns. One column contains the customers and the other column contains the sales achieved by the customers.

  1. Sort the list so that the customer with the most sales is at the top and the one with the lowest sales is at the bottom.
  2. Determine the percentage share of total sales for each customer. This share is then cumulated line by line so that you arrive at 100% at the very bottom.
  3. Divide the customers into groups A, B, and C according to the cumulated percentages. The A customers are the ones with the most sales and the C customers are the ones with the least sales. And as mentioned in the tip #5, don’t be afraid to get read of the customers that will not bring you a profit.

Have our suggestions convinced you? Or do you think there are other important steps you can take to optimize your customer base?

Leave a comment to discuss them with us!

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