Are You Picking the Right Wallet? - Bain & Company

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Snap Chart

Are You Picking the Right Wallet?

It’s critical to understand each customer’s total potential spending by the relevant product category.

  • September 07, 2017

Snap Chart

Are You Picking the Right Wallet?

 

When deciding where to allocate their salesforce capacity, many business-to-business companies base their choices on current and historical spending by customer. Accounts spending more with the company usually get more sales resources. But to attain stronger sales growth, it’s critical to understand each customer’s total potential spending by the relevant product category. Estimates of a customer’s wallet size can be built through heuristic models based on public and internal data that predicts or is a proxy for spending levels. Such data includes the customer’s Standard Industrial Classification code and revenues, number of workers, or number of locations. One enterprise software company estimated the total potential spending of its accounts for each category of information technology it sold. The chart reveals which accounts had little upside (a high share of wallet with low category spending overall) and which had major potential (a low share of wallet with substantial total spending). Based on the analysis, this company realigned resources (including the best sales hunters) to the lower right—large customers for which the company had a low share of wallet.

Related Bain Brief: Stop Flying Blind in Sales

Jonathan Frick and Mark Kovac are partners in Bain & Company’s Customer Strategy & Marketing practice, and Kovac leads the firm’s B2B Commercial Excellence work.

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