The Mismatch between Call Frequency and Account Potential: Where the Money is

Abstract

ABSTRACT Purpose: The purpose of this study is to examine the relationship between salesperson call frequency and account potential. In sharp contrast to conventional wisdom, in two case studies, we show that there is no relationship between call frequency and account potential. We conclude with a discussion of reasons why this may be the case. Design/Methodology/Approach: We provide results from two case studies. Using internal data from the firm and survey data, study 1 focused over 150 nurses in the United Kingdom who used a specific medical device with their patients. Here we asked the nurses a battery of approximately 40 questions. We combined this data with National Health Service on procedures performed at each hospital (a measure of account potential). Study two involves a different medical device maker. Here we examine monthly contact and compare it to account potential. Findings: Study 1 finds that contact frequency at the the lowest account potential quartile was statistically lower than each of the remaining quartiles. However, the second lowest quartile of had the exact same monthly contact frequency as the highest quartile of accounts even though the underlying potential of former is approximately one-third (36%) that of the highest quartile of hospitals. Study 2 finds a similar pattern. In particular, when we looked at monthly contact frequency for companies in account potential quartiles 1-2-3 and compared it to the highest account potential quartile, we again found no statistical difference between the two groups. Practical Implications: Sales reps in these two studies were not visiting the accounts with the highest potential. When sales reps are “re-allocated” to the highest potential accounts – sales increase dramatically. Originality/Value: Simple reallocation of the sales rep’s time can have significant implications for revenue growth. We provide some logic – that can be tested – on why sales reps may engage in this sub-optimal behavior.