Go After the Buyers Who Buy the Most

What it is

A business playbook by Chet Holmes, published by Portfolio in 2007. Holmes had run magazines, newspapers and trade shows for Charlie Munger, and the book boils his teaching down to twelve strategies. In the introduction he says building a sales machine is about “doing 12 things 4,000 times each.” Two of the twelve chapters are about getting the best buyers. His daughter, Amanda Holmes, has since updated the book in a revised edition.

What you’ll take from it

The Dream 100 story starts with a list of 2,200 potential advertisers, and 167 of them bought 95 percent of the advertising in Holmes’s market. So he focused on the 167. In his company’s telling, they got mail every two weeks and a call twice a month, and the first four months produced nothing before the deals came in.

The idea underneath, as Selling Power’s write-up of the book puts it, is that there are always far fewer best buyers than buyers, and the best ones spend more money, more quickly and more frequently. The same write-up tells the story of an office equipment client whose deals ran $10,000 to $28,000, with one $160,000 sale in the file. Holmes asked why they didn’t just go after big companies. The reps phoned 2,000 big companies in the area and found 508 running computer systems at least five years old, and that became the list.

The preface supplies the cost side.

“If it cost you $100 to get in front of a client 15 years ago, today it’s costing you $300.” Preface

Where it shows up in your numbers

A Dream 100 effort fails every volume KPI for months. Response rates are low, meetings are few and cost per meeting is high. A team managed on cost per lead or meetings booked shuts it down in month three and goes back to calling all 2,200.

Holmes’s best buyer spends more, faster and more frequently, so build the list from your own revenue file. Rank your accounts on spend, speed and frequency, check them against margin, and look for prospects that match the top. And measure your own concentration, because 167 buyers carrying 95 percent was his market, not every market.

Then name the list, give it its own budget and owner, and commit a fixed effort every week for at least two quarters. Measure it on revenue from accounts won and your share of their spend, and pay the reps who work it the same way, not on activity counts.

The Dream 100 chapters aren’t quoted on this page because no passage from them could be checked against the book. The account above follows Selling Power’s 2010 write-up and Chet Holmes International’s own telling.