The typical Hunter-Farmer approach is often used by sales organizations when a significant portion of customer lifetime value (CLTV) is earned after the initial sale. The Farmer’s job is to make sure the company realizes that value, whether by renewing, cross-selling, upselling, or increasing adoption. When done correctly, this method can be efficient and effective in driving revenue growth.
If you think you and your customers might be best served by a Hunter-Farmer approach but haven’t been able to justify the move, you might want to take a look at the hidden costs of not making the change. The difference may tip the scales for you.
Before diving further, let's debunk some commonly held myths and present the truth:
- Myth: One role holds greater importance than the other. While hunting is a necessary precursor to farming, it is often the farmer who drives the majority of CLTV and is therefore equally vital. Farmers possess the unique ability to provide invaluable feedback to the company, foster innovation, and refine or even create new products. Excelling in farming can have a significant impact on both the company's value and its bottom line.
What is true: Both the Hunter and Farmer are salespeople, regardless of their job titles. Both roles thrive on closing deals. The distinction lies in their disposition and strategy towards either cultivating new relationships or nurturing existing ones.
- Myth: Farmers are simply customer service agents. If this statement applies to your company, then you are following the wrong model. However, if you are in need of strategic-minded individuals who can successfully close renewals, sell new products, and find ways to increase your customers' business while ensuring their satisfaction, then you require the expertise of a sophisticated Farmer.
What is true: A seller's inherent skills need to be acknowledged, and if they are better at hunting, then let them do so. Ignoring these natural inclinations and strengths can have detrimental effects. It is always a gamble to go against human nature. This is a crucial part to understanding the hunter-farmer sales model.
What You May Not Be Seeing
If you and your customers benefit from an ongoing farming relationship and you’re depending on your farmers to bring in new logos, you’re not only missing out on the greater growth a Hunter focus can bring, but you’re also losing ground to your competitors in less obvious ways:
- Cognitive switching. This is a term that is often used when describing or attempting to debunk multitasking. Each time you switch focus, you incur a cognitive switching penalty, i.e., the effort and friction it takes to shift focus (costing as much as 40% of a person’s productive time). There’s a similar cost to seller's time when they are asked to do both hunting and farming: Switching from the new relationship focus to the existing relationship focus can take significant energy and drain efficiency – just ask someone who’s done it. And if someone is wired more in one direction than the other, that switching cost is even higher.
- The short end of the stick. Most sellers are wired for either creating new relationships or nurturing existing ones. If they are handling both, either your new logo prospects or existing customers are getting the short end from that seller. This can show up in poor closing ratios, customer churn, or general dissatisfaction. If you have a mix of orientations in your sales force, you might get okay results overall, but when you dig into the numbers you might see costly patterns.
- Talent cost. If you ask experienced sales leaders, most will tell you that their best talent excels either at hunting or farming – rarely does the highest proficiency for both exist in the same person. This shows A-players clustered around either end of the selling relationship spectrum, or the end where they focus on their strength. Those that are pretty good at both tend to cluster in the B- and C-player middle. If you’ve been forcing a balance of hunting and farming activity on each of your sellers, you may already be left with the “mediocre middle” and not even know it. Meaning, the A-players have already left, and A-candidates are turning up their noses at the blended role. How much do you think that is costing you?
If you add these costs into your equation, you might find it justifies the change. The good news is that your sellers might have already self-selected in a quiet manner, emphasizing their strengths. If so, identifying the right people for the more defined roles may not be hard, and the change will be welcomed.