Terms

Net New Business

Net new business is revenue generated from acquiring entirely new customers or by selling new products and services to an existing client base. This is distinct from recurring revenue from current contracts, as it focuses on creating completely new income streams that drive growth. Ultimately, it's a critical measure of a company's ability to expand its market presence and ensure its long-term health.

Importance of Net New Business

Net new business is the lifeblood of any company, serving as the primary driver for revenue growth. It's essential for offsetting customer churn and ensuring long-term stability. By consistently acquiring new clients, a business can increase its market share, enhance its reputation, and maintain a competitive edge in the industry.

Strategies to Increase Net New Business

Generating net new business requires a multi-pronged approach that combines acquiring new customers with expanding existing relationships. Effective strategies focus on targeted outreach and creating new value for both new and current clients.

  • Prospecting: Actively seeking out and engaging potential new clients who have not done business with you before.
  • Cross-selling: Introducing new products or services to your existing customer base to create new revenue streams.
  • Marketing: Utilizing digital marketing and targeted campaigns to attract and engage buyers actively looking for solutions.
  • Referrals: Leveraging satisfied current clients to generate introductions and warm leads for new business opportunities.

Net New Business vs. Gross New Business

While both metrics measure sales success, they offer different perspectives on a company's growth trajectory.

  • Net New Business: This focuses on revenue from entirely new customers or new product lines with existing clients. It is a true indicator of growth and market expansion, crucial for long-term stability. Enterprises and mid-market companies prioritize this for sustainable growth and offsetting churn, though it can be more costly to acquire.
  • Gross New Business: This represents the total value of all new contracts, including renewals and upsells with existing customers. It reflects overall sales activity and momentum but can mask high customer churn. Enterprises might track this to gauge sales volume, while mid-market firms often find net new business a more critical health indicator.

Challenges in Acquiring Net New Business

Internal structures can create significant roadblocks. Compensation plans may not reward prospecting, leading to sales team complacency and a lack of accountability for generating new opportunities. This focus on existing accounts can dull the skills needed to win new clients.

Market dynamics also present major hurdles. High customer churn can easily outpace new client acquisition, while over-reliance on a few key accounts creates vulnerability. Meanwhile, competitors are always targeting your top clients, making growth a constant challenge.

Measuring Success in Net New Business

Measuring net new business success requires tracking specific KPIs that reveal true growth beyond overall revenue. These metrics help gauge the effectiveness of your sales and marketing efforts in expanding your customer base. By monitoring these key indicators, you can ensure your acquisition strategies are outpacing customer churn and contributing to long-term stability.

  • Acquisition Rate: The pace at which you gain new customers or "new logos."
  • Revenue Growth: The increase in revenue generated from new clients and new product sales to existing ones.
  • Churn Rate: The percentage of customers lost, which new business must outpace for sustainable growth.

Frequently Asked Questions about Net New Business

How does net new business differ from upselling?

Net new business involves selling entirely new products or services to existing clients. Upselling focuses on increasing revenue from a current product by upgrading a plan or adding seats, which is typically considered expansion revenue, not net new.

Is net new business only about acquiring new logos?

Not exclusively. While acquiring new customers ("new logos") is a primary component, net new business also includes revenue from cross-selling entirely new products or services to your existing client base. It's about creating fundamentally new revenue streams.

Why prioritize net new business if it's more expensive to acquire?

While costlier, it's essential for long-term stability and market expansion. It offsets inevitable customer churn and reduces dependency on a few large accounts. This focus prevents stagnation and mitigates risk over time, ensuring sustainable growth.

Other terms

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Marketo

Marketo is a marketing automation platform used by B2B marketers to manage lead generation, nurturing, email marketing, and analytics.

Marketo

Data-Driven Marketing

Data-driven marketing uses customer data to inform marketing decisions, optimize campaigns, and deliver personalized experiences to consumers.

Data-Driven Marketing

Smile and Dial

"Smile and dial" is a high-volume sales tactic where reps make numerous cold calls from a list, often with little to no prior research.

Smile and Dial

Brand Equity

Learn about brand equity, including understanding its importance, building strong brand equity, measuring brand equity, & real-world applications.

Brand Equity

Multi-Channel Marketing

Multi-channel marketing uses various platforms—like email, social media, and direct mail—to engage with customers wherever they are.

Multi-Channel Marketing

B2B Contact Base

Learn about B2B contact base, including building an effective B2B contact base, & strategies for expanding your contact base.

B2B Contact Base

Awareness Buying Stage

The awareness stage is the first step in the buyer's journey, where a potential customer realizes they have a problem or an opportunity to explore.

Awareness Buying Stage

Buyer Journey

The buyer journey maps the path a potential customer takes, from first learning about a product to the final decision to buy.

Buyer Journey

Loyalty Programs

Loyalty programs are marketing strategies designed to reward repeat customers. They offer incentives like discounts or exclusive access to encourage retention.

Loyalty Programs

Sales Demonstration

A sales demonstration is a presentation showing a prospect how a product or service works and how it can solve their specific problems.

Sales Demonstration

Sales Funnel Metrics

Sales funnel metrics are key data points that track how effectively you're moving potential customers from awareness to a final purchase.

Sales Funnel Metrics

Sales Forecast Accuracy

Sales forecast accuracy is a key metric that compares your predicted sales revenue against the actual sales revenue you ultimately achieve.

Sales Forecast Accuracy

Call for Proposal

A Call for Proposal (CFP) is a document that solicits proposals, often through a bidding process, for a specific project or service.

Call for Proposal

Net 30

Net 30 is a common payment term where a client has 30 calendar days from the invoice date to pay for goods or services in full.

Net 30

Technographics

Technographics is data that outlines a company’s technology stack, helping B2B teams identify prospects based on the software and hardware they use.

Technographics

Lead Conversion

Lead conversion is the process of turning a prospect into a customer by getting them to complete a desired action, such as making a purchase.

Lead Conversion

Sales Team Management

Sales team management is the process of leading, coaching, and motivating a sales team to achieve its sales goals and drive revenue growth.

Sales Team Management

Remote Sales

Remote sales is selling from a distance. Reps use digital tools to connect with prospects and close deals without meeting them in person.

Remote Sales

Target Account Selling

Target Account Selling is a focused sales strategy where teams identify and pursue a specific list of high-value accounts.

Target Account Selling

Buying Cycle

The buying cycle is the journey a customer takes from first realizing they have a need to making the final purchase decision.

Buying Cycle

Brag Book

Learn about brag book, including crafting your outstanding brag book, essential components of a brag book, & brag book vs. resume: unveiling the differences.

Brag Book

DMP

A Data Management Platform (DMP) is a tech platform used to collect and manage data, mainly for digital marketing and advertising campaigns.

DMP

RESTful API

A RESTful API is a web service interface that uses HTTP requests to access and use data, adhering to the constraints of REST architecture.

RESTful API

Drip Campaign

A drip campaign is a series of automated messages sent to prospects or customers over time to nurture leads and drive engagement.

Drip Campaign

Inventory Management

Inventory management is the process of ordering, storing, and using a company's inventory, from raw materials to finished goods.

Inventory Management

Hot Leads

Hot leads are prospective customers who have shown significant interest and are ready to buy, making them a top priority for sales teams.

Hot Leads

Sales Engineer

Sales Engineers blend deep technical knowledge with sales acumen, demonstrating a product's value and solving customer problems to drive revenue.

Sales Engineer

Sales Velocity

Sales velocity is a key metric measuring the speed at which your company makes money. It shows how fast deals move through your sales pipeline.

Sales Velocity

On-premise CRM

An on-premise CRM is a system hosted on a company's own servers, offering complete control over data, security, and system maintenance.

On-premise CRM

Data Warehousing

Data warehousing is the process of storing and managing large sets of data from various sources for business intelligence and reporting purposes.

Data Warehousing

Sales Manager

A Sales Manager leads a sales team, setting goals, analyzing performance, and developing strategies to drive revenue and meet targets.

Sales Manager

Voice Search Optimization

Voice search optimization is the process of optimizing your content, SEO, and online listings to appear in and rank for voice-based searches.

Voice Search Optimization

Dynamic Territories

Dynamic territories are fluid sales assignments that adjust based on real-time data, ensuring reps can focus on the highest-value accounts.

Dynamic Territories

Tire-Kicker

A tire-kicker is a prospect who shows interest in a product but has no intention of buying, wasting a salesperson's time and resources.

Tire-Kicker

Representational State Transfer Application Programming Interface

A Representational State Transfer (REST) API is a web service that uses a simple, stateless architecture for systems to communicate online.

Representational State Transfer Application Programming Interface

Rollback Procedures

Rollback procedures are a set of steps to restore a system to a previous, stable version after a failed update, ensuring minimal disruption.

Rollback Procedures

Version Control Systems

A version control system (VCS) tracks changes to files over time, allowing you to recall specific versions and collaborate without conflicts.

Version Control Systems

Lead Enrichment Tools

Lead enrichment tools are platforms that automatically add missing data to your leads, like contact info, firmographics, and buying signals.

Lead Enrichment Tools

Demand Capture

Demand capture is the strategy of engaging potential customers who are already actively looking for a solution that your company provides.

Demand Capture

Lead Scoring

Lead scoring is the process of assigning points to leads based on their attributes and actions to determine their sales-readiness.

Lead Scoring

Marketing Qualified Account

A Marketing Qualified Account (MQA) is a target company that has shown significant engagement, indicating it's ready for the sales team to pursue.

Marketing Qualified Account

Spiff

A spiff is a short-term sales incentive, often a cash bonus, paid directly to a salesperson for selling a specific product or service.

Spiff

Virtual Private Cloud

A Virtual Private Cloud (VPC) is a secure, isolated section of a public cloud. It lets you provision your own logically isolated resources.

Virtual Private Cloud

Sales Process

A sales process is a structured set of steps that a sales team follows to move a prospect from an initial lead to a closed customer.

Sales Process

Content Curation

Content curation involves gathering, organizing, and sharing the most relevant online content on a specific topic for a particular audience.

Content Curation

Robotic Process Automation

Robotic Process Automation (RPA) uses software bots to mimic human actions and automate repetitive, rules-based tasks on digital systems.

Robotic Process Automation

Data Security

Data security protects digital information from unauthorized access, corruption, or theft throughout its entire lifecycle.

Data Security

Digital Sales Room

A Digital Sales Room is a private online space where sellers share all relevant content with buyers to streamline the sales cycle.

Digital Sales Room

Marketing Qualified Lead (MQL)

A Marketing Qualified Lead (MQL) is a prospect who has shown interest based on marketing efforts but isn't yet ready for a sales conversation.

Marketing Qualified Lead (MQL)

White Label

White labeling is when a company puts its own branding on a product or service that was actually produced by a different company.

White Label

Agile Methodology

Agile methodology is an iterative approach to project management and software development, focusing on delivering value in small, incremental steps.

Agile Methodology

Smarketing

Smarketing is the process of aligning your sales and marketing teams. This integration focuses on shared goals to improve lead quality and drive revenue.

Smarketing

Sales Prospecting

Sales prospecting is the process of identifying potential customers, or prospects, and initiating contact to convert them into paying customers.

Sales Prospecting

Open Rate

The open rate is the percentage of recipients who opened an email. It's a primary indicator of a subject line's effectiveness.

Open Rate

Inbound Lead Generation

Inbound lead generation is the process of attracting potential customers to your business with valuable content and tailored experiences.

Inbound Lead Generation

Discount Strategies

Discount strategies are pricing tactics used to attract customers and boost sales by temporarily reducing the price of products or services.

Discount Strategies

Dynamic Data

Dynamic data is information that updates in real-time. Unlike static data, it reflects the most current state of information automatically.

Dynamic Data

Enrichment

Enrichment is the process of adding third-party data to your existing customer profiles to get a more complete picture of your leads.

Enrichment

Key Performance Indicators

Key Performance Indicators (KPIs) are measurable values that demonstrate how effectively a company is achieving its key business objectives.

Key Performance Indicators

BAB Formula

Learn about BAB formula, including implementing BAB in sales strategies, crafting an effective BAB pitch, & comparing BAB with other sales frameworks.

BAB Formula

Forecasting

Forecasting uses historical data to make informed predictions about future trends, helping businesses anticipate outcomes and plan accordingly.

Forecasting

Sales Lead

A sales lead is a potential customer—an individual or organization that has shown interest in your company's products or services.

Sales Lead

Sales and Marketing Analytics

Sales and marketing analytics involves measuring and analyzing performance data to maximize effectiveness and optimize return on investment (ROI).

Sales and Marketing Analytics

Tokenization

Tokenization is the process of breaking down text into smaller units called tokens, such as words or characters, for AI to process.

Tokenization

Siloed

Siloed describes the isolation of data, teams, or systems within a company, which blocks collaboration and creates operational bottlenecks.

Siloed

Average Order Value

Average Order Value (AOV) tracks the average dollar amount spent each time a customer places an order on your website or mobile app.

Average Order Value

Statement of Work

A Statement of Work (SoW) is a document that outlines a project's scope, deliverables, and timeline. It acts as a contract between parties.

Statement of Work

Territory Management

Territory management is the process of segmenting customers into groups by geography or other factors to optimize sales efforts and resources.

Territory Management

Demand Forecasting

Demand forecasting is the process of predicting future customer demand for a product or service based on historical data and market trends.

Demand Forecasting

No Spam

“No Spam” is a commitment to sending only relevant, solicited messages. It means avoiding bulk, unwanted emails to respect the recipient's inbox.

No Spam

Closed Opportunities

Closed opportunities are potential deals that have concluded. They are categorized as either 'closed-won' (a sale was made) or 'closed-lost'.

Closed Opportunities

Total Audience Measurement

Total Audience Measurement (TAM) provides a holistic view of content consumption, tracking viewership across all platforms and devices.

Total Audience Measurement

Average Revenue per User

Average Revenue per User (ARPU) is a key performance indicator that calculates the average revenue generated from each user or subscriber.

Average Revenue per User

Value-Added Reseller

A Value-Added Reseller (VAR) is a company that adds features or services to an existing product, then resells it as an integrated solution.

Value-Added Reseller

Consumer

A consumer is an individual or entity that buys products or services for personal use, not for resale. They are the final user in a supply chain.

Consumer

Lead Scrape

Lead scraping is the process of automatically extracting contact information and other relevant data about potential customers from online sources.

Lead Scrape

X-Sell

X-Sell, or cross-selling, is a sales strategy of selling additional, related products or services to an existing customer base.

X-Sell

Guided Selling

Guided selling simplifies complex sales by giving reps step-by-step instructions and data-driven recommendations to close deals faster.

Guided Selling

Sales Conversion Rate

Sales conversion rate is the percentage of prospects who take a desired action, like making a purchase, turning them into customers.

Sales Conversion Rate

Sales Territory Planning

Sales territory planning is the process of dividing customers into geographic areas to be assigned to specific sales reps or teams.

Sales Territory Planning

Customer Experience

Customer experience (CX) is a customer's total perception of your business, based on every interaction across the entire customer lifecycle.

Customer Experience

Digital Strategy

A digital strategy outlines how your business will use online channels, data, and technology to achieve its goals and connect with customers.

Digital Strategy

Sales Dialer

A sales dialer is software that automates outbound calling for sales teams, allowing reps to connect with more prospects in less time.

Sales Dialer

Buyer Behavior

Learn about buyer behavior, including understanding the buyer's journey, influencing factors in buyer behavior, & buyer behavior and marketing strategy.

Buyer Behavior

Return on Marketing Investment

Return on Marketing Investment (ROMI) measures the revenue generated by a marketing campaign relative to the cost of that campaign.

Return on Marketing Investment

Lookalike Audiences

Lookalike audiences are groups of potential customers who share similar characteristics and behaviors with your existing, high-value customers.

Lookalike Audiences

Scrum

Scrum is an agile framework that helps teams structure and manage their work through a set of values, principles, and practices.

Scrum

Data Encryption

Data encryption translates data into another form, or code, so that only people with access to a secret key or password can read it.

Data Encryption

Lead Generation

Lead generation is the process of identifying and cultivating potential customers for a business's products or services.

Lead Generation

Sentiment Analysis

Sentiment analysis, or opinion mining, automatically determines the emotional tone behind text—whether it's positive, negative, or neutral.

Sentiment Analysis

Git

Git is a distributed version control system that tracks changes in code, allowing developers to collaborate and manage project history effectively.

Git

Customer Relationship Marketing

Customer relationship marketing is a strategy for building lasting connections with customers to foster long-term loyalty and engagement.

Customer Relationship Marketing

API

An API (Application Programming Interface) is a software intermediary that allows two applications to talk to each other and exchange information.

API

Marketing Automation Platform

A marketing automation platform is software that automates marketing actions. It helps manage tasks like email campaigns and lead nurturing.

Marketing Automation Platform

Video Selling

Video selling uses personalized video messages to engage prospects, build rapport, and guide them through the sales funnel to close more deals.

Video Selling

Email Personalization

Email personalization uses subscriber data—like their name, interests, or past behavior—to create highly relevant and targeted email campaigns.

Email Personalization

Consumer Buying Behavior

Consumer buying behavior is the study of how individuals select, buy, and use products and services to satisfy their needs and desires.

Consumer Buying Behavior

Weighted Sales Pipeline

A weighted sales pipeline forecasts revenue by assigning a closing probability to each deal, giving a more accurate picture of potential income.

Weighted Sales Pipeline

Multi-threading

Multi-threading allows a single CPU core to run multiple independent threads (or tasks) at the same time, boosting efficiency and performance.

Multi-threading

Adobe Analytics

Adobe Analytics is a leading web analytics solution for gaining real-time insights into user activity across websites and mobile applications.

Adobe Analytics