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How to Regain Momentum in a Sales Drought

Focus or Expand? That's the question

What do you do when your customer pipeline starts slowing down? Do you expand your offering to new clients? Or Do you focus on getting new business from your current market niche? Most business owners answer with “expansion”. They then find themselves in financial trouble.

In today’s post I will explain why expanding your market niche is often the wrong answer to this question.

Why do we want to expand?

I’ve been in business for a very long time. I’ve been in more than my share of “sales droughts”. My primary business was the ESCo (Energy Service Company) industry where our sales cycles took 6-months to 1-year to close. We tended to focus on vertical markets like public school districts in Colorado, or hospitals in Nebraska. When sales activity starting to wane, I’d get nervous about upcoming revenue shortfalls. My first inclination was to try a new market. Maybe Colorado Counties?

I thought the reason for our drought was that our market had run its course and opportunity must exist elsewhere. This lie combined with my impatient nature prompted me to look for business elsewhere.

Why does expansion fail as a desperate growth strategy?

Expanding your business to a new market niche is the same as starting up a new business. You may have some common elements that allow you to serve your new market segment the same as your previous markets, but that’s not your problem. If you’re in a “sales drought”, your problem is “new customers”, not turning your backlog into revenue.

What is the LIE of the expansion myth?

Let’s address “the lie” that there are no more customers in your current market niche. The fact is that you have most likely not truly connected with all the customers in your current market niche. By “connected”, I mean that you have captured their attention and had productive sales conversations with the decision makers in those groups.

In the case of the ESCo marketplace, most clients are public sector. This means that they are governed by an elected board; and they have a key lead administrator. For school districts this administrator is the school district superintendent. The average tenure of a school district superintendent is 3-years. School board member elections happen every two years. The most stable individual in the decision-making chain of a school district is the facility director. This individual’s average tenure is 10-years. This turnover means that your current market is constantly changing.

In addition to people changing, equipment is constantly aging, and new technologies are emerging in energy efficiency, renewable energy and energy conservation on a regular basis.

These two states of transition, means that your current market is constantly changing.

How do you focus and gain new customers?

I have discovered a rule about people. People respond positively when you demonstrate that you care about them. In a business setting, this rule applies to employees and customers. The reason that you’re not getting new customers in your current market is that you’re ignoring what genuinely matters to prospective buyers in your current market.

It may be that…

…you need to modernize your service offering to match your customer’s current needs.

…you don’t have a relationship with new decision makers in your current marketplace.

…you botched a sales discussion with a prospect that needs what you offer.

…your sales team isn’t diligent about follow up or follow through.

…there are some objections to your offering that you ignored or were unspoken by previous contacts.

I guarantee you that if you dive into your current market, refresh connections with previous contacts and listen to what they are saying to you, your sales activity will increase much more rapidly than expanding to other markets… where you’re likely to repeat the same errors that caused your current market to dry up.

Is there a right time to expand?

Finding new niches and expanding your product and service offering can be great ways to grow your business. There are two indicators that I look for to expand: 1) great cashflow from current operations; and 2) investor cash injections. While expanding to a new market niche in a sales drought is a bad idea; expanding in an investment windfall is highly recommended.

Like I said, expanding to a new market niche is like starting a new business. This means that it will take time to generate revenue from this new business after you have created a successful sales and marketing strategy.

This means that expansion works well when sales are booming in your current market; and you want to expand your success to an adjacent market.

A quick personal story…

It’s easy for me to type up this blog post and tell you what to do. I want to quickly share a personal experience with my business, Ennovate Corporation (now Ameresco Inc.). We started in Colorado with a focus on rural school districts. Most of these folks were being overlooked by the large ESCo’s. Smaller ESCo’s in our state were doing very low-cost retrofits that turned off pumps and fans to save energy. Our approach was to help rural schools get grants from the state to improve their buildings, add cooling to schools that had no cooling capability and upgrade infrastructure through larger capital projects. As our success increased in this market niche, we attracted competition from other ESCo’s. Instead of digging in and engaging with this market when grant programs became more competitive, I decided to move to municipality and county markets. As we expanded, we lost our momentum with our core market niche and watched as our competition started serving this marketplace with great success. Eventually, we laid off five quality employees, as revenues continued to decline. Fortunately, our new market niches started bearing fruit. After my lesson was learned, I stuck with our market segments, even during sales droughts. Eventually, we created great market momentum in Kansas, Nebraska, and other market niches in Colorado.


If you’re like most entrepreneurs, you will want to expand your products, services and niche market segments when you’re in a sales drought. Please don’t do it. You will regain your momentum by reaching back out to your existing clients and prospects that you thought you lost. It’s much quicker and more successful way to regain lost sales momentum.

If you’d like to learn more about Mechanics & Mindset Business Coaching, please visit my website at



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