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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Trigger Marketing

Trigger marketing uses customer actions or events to automatically send highly relevant, personalized messages at the perfect moment.

Trigger Marketing

Application Performance Management

Application Performance Management (APM) monitors and manages an application's performance, availability, and the experience of its end-users.

Application Performance Management

Buying Signal

A buying signal is any action from a prospect that indicates they are interested in making a purchase, helping sales teams prioritize leads.

Buying Signal

Expansion Revenue

Expansion revenue is the extra money a business makes from its current customers via upgrades, new products, or additional services.

Expansion Revenue

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

Microservices

Microservices is an architecture where apps are built as a collection of small, independent services that communicate with each other over APIs.

Microservices

Buying Criteria

Buying criteria are the specific requirements and standards a customer uses to evaluate products or services before making a decision.

Buying Criteria

Competitive Analysis

Competitive analysis means identifying your rivals and assessing their strategies to pinpoint your own business's strengths and weaknesses.

Competitive Analysis

B2B Sales

Learn about B2B sales, including key strategies for B2B success, types of B2B sales models, & B2B vs. B2C sales: understanding the differences.

B2B Sales

Employee Engagement

Employee engagement is the emotional commitment an employee has to their organization, motivating them to contribute to the company's success.

Employee Engagement

Marketing Qualified Opportunity

A Marketing Qualified Opportunity (MQO) is a lead vetted by marketing as a genuine sales opportunity, ready for direct sales follow-up.

Marketing Qualified Opportunity

Objection Handling

Objection handling is the process of responding to a prospect's concerns or hesitations about a product or service to move a deal forward.

Objection Handling

Buying Committee

A buying committee is a group of stakeholders within an organization who are jointly responsible for making major purchasing decisions.

Buying Committee

Progressive Web Apps

Progressive Web Apps (PWAs) are websites that look and feel like native mobile apps, offering features like offline access and push notifications.

Progressive Web Apps

Data Enrichment

Data enrichment is the process of enhancing raw data by adding missing information from other sources, making it more complete and actionable.

Data Enrichment

Account-Based Marketing Software

Account-Based Marketing (ABM) software helps teams coordinate personalized marketing and sales efforts to land high-value customer accounts.

Account-Based Marketing Software

B2B Marketing Attribution

Learn about B2B marketing attribution, including challenges in B2B marketing attribution, & key metrics for effective attribution.

B2B Marketing Attribution

Sales Intelligence Platform

A sales intelligence platform is software that provides sales teams with data and insights about prospects to help them sell more effectively.

Sales Intelligence Platform

Generic Keywords

Generic keywords are broad search terms that lack specific details like brand or location. They attract a wide audience with less specific intent.

Generic Keywords

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

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)

Outbound Sales

Outbound sales is when reps proactively contact potential customers through cold calls or emails to generate leads and build a sales pipeline.

Outbound Sales

Lead Enrichment

Lead enrichment adds third-party data to your raw lead lists, creating fuller prospect profiles for more effective and personalized outreach.

Lead Enrichment

Stress Testing

Stress testing is a type of software testing that determines a system's robustness by pushing it beyond its normal operational capacity.

Stress Testing

Value Statement

A value statement is a clear, concise declaration of the unique benefits a company provides to its customers, outlining its core purpose.

Value Statement

Marketing Mix

The marketing mix is the set of marketing tools a company uses to sell products, defined by the 4Ps: Product, Price, Place, and Promotion.

Marketing Mix

Account Management

Account management is the post-sales practice of building and nurturing long-term relationships with a company's most valuable clients.

Account Management

Sales Methodology

A sales methodology is the framework that guides how your sales team approaches the entire sales process, from prospecting to closing deals.

Sales Methodology

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

Demand Generation

Demand generation is the process of creating awareness and interest in your products to build a pipeline of qualified leads for your sales team.

Demand Generation

GPCTBA/C&I

GPCTBA/C&I is a sales qualification framework for understanding a prospect's goals, plans, challenges, timeline, budget, and authority.

GPCTBA/C&I

Regression Testing

Regression testing ensures that new code changes don’t negatively impact existing features. It's a key step to maintain software quality after updates.

Regression Testing

Marketing Attribution Model

A marketing attribution model is a framework for assigning credit to the marketing touchpoints that lead a customer to convert.

Marketing Attribution Model

Sales Pipeline

A sales pipeline is a visual representation of where prospects are in the sales process, from the first contact to the final sale.

Sales Pipeline

Buyer

Learn about buyer, including identifying your ideal buyer, understanding buyer's journey, & evaluating buyer decision processes.

Buyer

Workflow Automation

Workflow automation uses rule-based logic to run a sequence of tasks that would otherwise require manual human effort to complete.

Workflow Automation

Sales Enablement Technology

Sales enablement technology refers to software and tools that equip sales teams with the resources they need to close more deals efficiently.

Sales Enablement Technology

End of Quarter

“End of Quarter” (EOQ) refers to the final weeks of a business quarter when sales teams rush to meet quotas, often leading to a flurry of deals.

End of Quarter

Order Management

Order management is the end-to-end process of tracking customer orders from placement to fulfillment, ensuring a seamless customer experience.

Order Management

Account Development Representative

An Account Development Representative (ADR) identifies and qualifies new business opportunities, creating a pipeline for account executives.

Account Development Representative

User Interaction

User interaction is any action a user takes within a digital interface, like clicking a button, scrolling a page, or filling out a form.

User Interaction

Simple Object Access Protocol Application Programming Interface

A Simple Object Access Protocol (SOAP) API is a web service that uses XML to exchange structured information between different applications.

Simple Object Access Protocol Application Programming Interface

Channel Partners

Channel partners are third-party firms that help market and sell a company's products or services, acting as an indirect sales force.

Channel Partners

B2B Data Platform

Learn about B2B data platform, including key benefits of B2B data platforms, choosing the right B2B data platform, challenges in implementing B2B data platforms.

B2B Data Platform

Voice Broadcasting

Voice broadcasting is an automated system that delivers a pre-recorded voice message to a large list of phone numbers simultaneously.

Voice Broadcasting

Marketo

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

Marketo

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

Use Case

A use case is a detailed description of how a user interacts with a system to achieve a specific goal, outlining the steps from start to finish.

Use Case

Net Revenue Retention (NRR)

Net Revenue Retention (NRR) is the percentage of recurring revenue kept from existing customers, including upsells, downgrades, and churn.

Net Revenue Retention (NRR)

Closed Won

Closed Won is a CRM status for a sales deal that has been successfully concluded, resulting in a signed contract and a new customer.

Closed Won

Contact Data

Contact data is the set of details, like names, emails, and phone numbers, used to get in touch with a person or business for outreach.

Contact Data

No Cold Calls

No Cold Calls is a sales strategy that replaces unsolicited calls with warm outreach to prospects who have already demonstrated interest.

No Cold Calls

Commission

A commission is a service charge paid to an agent for a transaction. It's typically a percentage of the sale, rewarding performance directly.

Commission

Accounts Payable

Accounts Payable (AP) is the money a company owes its suppliers for goods or services bought on credit. It's listed as a current liability.

Accounts Payable

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

Account-Based Selling

Account-Based Selling is a B2B strategy where sales and marketing treat high-value accounts as markets of one, using personalized outreach.

Account-Based Selling

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

Sales Enablement

Sales enablement provides sales teams with the necessary tools, content, and information to help them sell more effectively and efficiently.

Sales Enablement

SAM

Serviceable Addressable Market (SAM) is the portion of the market your business can realistically serve with its current products and sales channels.

SAM

Psychographics

Psychographics categorizes people by their attitudes, interests, and lifestyles, revealing the 'why' behind their purchasing decisions.

Psychographics

Personalization in Sales

Personalization in sales means tailoring outreach to a prospect's specific needs, interests, and context to make communication more relevant.

Personalization in Sales

Mid-Market

Mid-market companies are businesses larger than small businesses but smaller than large enterprises, often defined by revenue or employee size.

Mid-Market

Feature Flags

Feature flags let you remotely control features in your app without new code. This enables safe testing, gradual rollouts, and quick rollbacks.

Feature Flags

Lead Generation Software

Lead generation software helps businesses automate finding and capturing potential customers' contact information to build sales pipelines.

Lead Generation Software

Product-Led Growth

Product-Led Growth (PLG) is a business strategy where the product itself drives user acquisition, conversion, and expansion.

Product-Led Growth

Lead Qualification Process

The lead qualification process is how you determine which prospects are most likely to become customers by evaluating them against specific criteria.

Lead Qualification Process

Buyer’s Remorse

Buyer’s remorse is the sense of regret or anxiety that can arise after making a purchase, often questioning if it was the right decision.

Buyer’s Remorse

Sales Territory

A sales territory is a specific group of customers or a geographic area that a salesperson or sales team is responsible for managing.

Sales Territory

API

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

API

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

Event Marketing

Event marketing is a strategy where brands engage directly with target audiences through live events like trade shows, conferences, or webinars.

Event Marketing

Dynamic Pricing

Dynamic pricing is a strategy where businesses set flexible prices for products or services based on current market demands and other factors.

Dynamic Pricing

Cross-Selling

Cross-selling is a sales tactic of encouraging customers to purchase products or services that are related to what they're already buying.

Cross-Selling

Affiliate Marketing

Affiliate marketing is a performance-based model where affiliates earn a commission for promoting another company’s products or services.

Affiliate Marketing

Enterprise Resource Planning

Enterprise Resource Planning (ERP) is a system of integrated software that businesses use to manage and automate their core day-to-day processes.

Enterprise Resource Planning

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

Site Retargeting

Site retargeting is a marketing strategy that shows ads to people who have previously visited your website but left without converting.

Site Retargeting

Channel Partner

A channel partner is a company that works with a manufacturer or producer to market and sell their products, software, or services to customers.

Channel Partner

Ideal Customer Profile

An Ideal Customer Profile (ICP) is a detailed description of the perfect, hypothetical company that would get the most value from your product.

Ideal Customer Profile

Objection Handling in Sales

Objection handling in sales is the process of responding to a prospect's concerns about a product or service to move the deal forward.

Objection Handling in Sales

Customer Acquisition Cost

Customer Acquisition Cost (CAC) is the total cost a business spends to gain a new customer. It includes all sales and marketing expenses.

Customer Acquisition Cost

Docker

Docker is a tool that packages applications and their dependencies into isolated environments called containers for easy deployment and scaling.

Docker

Enterprise

An enterprise is a large-scale organization, often a corporation, defined by its complex structure and substantial number of employees.

Enterprise

Sales Partnerships

Sales partnerships are strategic alliances where two companies co-sell products to expand their reach, generate new leads, and increase revenue.

Sales Partnerships

Persona-Based Marketing

Persona-based marketing uses fictional customer profiles, or personas, to create targeted messaging for specific audience segments.

Persona-Based Marketing

Precision Targeting

Precision targeting is a marketing strategy that uses data to identify and reach a highly specific audience most likely to convert.

Precision Targeting

Chatbots

Chatbots are AI-powered programs that simulate human conversation. They interact with users via text or voice, typically for customer support.

Chatbots

Shipping Solutions

Shipping solutions are services or software that streamline the logistics of getting products to customers, from label printing to final delivery.

Shipping Solutions

Sandboxes

A sandbox is an isolated testing environment where new or untrusted code can be run safely without affecting the host device or network.

Sandboxes

Talk Track

A talk track is a script that guides sales reps during calls. It ensures they cover key points and maintain a consistent message with prospects.

Talk Track

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

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

FAB Technique

The FAB technique is a sales framework connecting product features to advantages and then to the specific benefits for the customer.

FAB Technique

Audience Targeting

Audience targeting is the process of segmenting consumers into specific groups to deliver more personalized and relevant marketing messages.

Audience Targeting

Cross-Site Scripting

Cross-Site Scripting (XSS) is a web security vulnerability that allows attackers to inject malicious scripts into trusted websites.

Cross-Site Scripting

Email Marketing

Email marketing is a digital strategy where businesses send targeted emails to prospects and customers to build relationships and drive sales.

Email Marketing

Integration Testing

Integration testing is a software testing phase where individual modules are combined and tested together to verify their interaction.

Integration Testing

Lead Nurturing

Lead nurturing is the process of developing and reinforcing relationships with buyers at every stage of the sales funnel.

Lead Nurturing

Copyright Compliance

Copyright compliance is adhering to laws that protect creative works. It involves legally using content by obtaining permission or licenses.

Copyright Compliance

Business Development Representative

Learn about business development representative, including skills and qualifications for BDRs, & roles and responsibilities of a BDR.

Business Development Representative