In the past few years, the term “participation trophy” has entered our lexicon, typically thought of as something everyone is given for trying regardless of the outcome. As a two-time marathon finisher, I have been given a participation award for each race; however, those metals were totally earned through the many hours of planning and training. While not a two-time marathon winner, it’s the execution of all that preparation that got me to my personal goal of running the dreaded distance of 26 miles and 385 yards (twice).
In the first post of this series, the 3 Pillars of Growth we outlined – Participation, Targeting, and Pricing. In this post, we are going to dive deeper into what participation is in the context of business and how executing on it can spark significant growth.
Total Addressable Market
As a connectivity provider, the knee-jerk association you have when considering “your footprint” is with your current customer base. It makes perfect sense to think about the list of connected buildings that you’re serving. However, let’s look a little closer at a real-world example of the difference between current customers and your footprint’s true addressable market.
A new customer of mine recently sent me a customer list that included 1,001 customer names and addresses. This had previously been what they had considered their entire serviceable market and what they had been sharing with their business partners. Once we removed customers who shared a building, we ended up with a list of 960 unique locations served and now we had their on-net building list. Not a bad start for a middle-of-the-country connectivity provider in one state; however, that was just the beginning of our process of defining their total addressable market.
Next, we used their splice points to define their near-net buildings, which in this instance was any commercial building within 2,500 feet (but not as the “crow flies,” but instead, via a bike-based distance). This type of analysis follows the road as the means of directional measurement that disregards the direction of traffic. By doing this analysis, we added 37,635 new addresses that were within a distance that they felt comfortable taking orders for if a business partner had a project order for them to fulfill.
By adding these new near-net buildings, their Total Addressable Market expanded by 3,922% and now represented locations they currently serve or are ready to serve within a 60-day window. With an average of 2% of new orders from a near-net list, this type of analysis gives this provider approximately 750 new lit buildings in the coming year. That’s the kind of opportunity companies cannot afford to ignore.
On a side note, this is not the same as looking at your planned routes, which may be new projects or simple expansion construction plans. This same customer won a construction bid to connect a large hospital to their current network with a short connector of a few miles with construction planned to be done by the end of 2019. Instead of waiting for construction to be completed and then knocking on doors in a direct sales model (in 2020), they have created a list of 4,583 companies within 2,500 feet of the soon-to-be route and began their outreach now, so they can identify potential customers today and have them ready for sales execution when the route is finished. They are getting a jump on 2020 right now and working hard to maximize their revenues on committed construction efforts. This process has also allowed them to create a planned building list for all those locations they expect to connect to in the future.
Sharing and Access
If you have spent any time in telecommunication’s “competition” world, you know that sharing your building list with your buying partners is the means by which they get your list of where you can offer services. On-net buildings are expected. Near-net buildings are a delighter. Planned buildings would be a “wow” factor.
Sharing these locations in the typical means – Excel Files and Emails – has been the industry norm for quite some time; however, this brings its own challenges:
Different excel formats.
Different types of data from each supplier
Different nomenclature from provider to provider
Different update intervals
While all of that is painful, here are the real concerns… is your building list ever being reviewed? Does your partner look at your total addressable market when responding to an RFP? Do they use the latest data you have sent to them? Do you represent an area they want to do business in? Are they looking in areas you currently don’t serve? The old Excel and email mechanism of communication leave many of these concerns in place.
My customer, who has all these questions, has developed a near-term strategy to use software and APIs to easily and automatically communicate their building list to partners with a pre-set interval and in a format the individual partner understands. This type of sharing mechanism should drastically help increase the client’s participation in qualified deals.
Final Thoughts
When considering how to increase participation in deals in 2019 by defining your true total addressable market, consider that although developing an on-net building list is not very difficult, expanding this to include near-net and planned buildings for both internal and partner consumption takes not just effort but sustained review and updating if done manually.
So, the real question is how do you want to be seen by your business partners? A provider with a customer base in 960 locations or an agile partner who is connected in real-time with a footprint of 38,613 locations (and many more to come with your planned expansions)?
Make 2019 the year you plan your execution to move to a real-time total addressable market and drive growth through modern participation.