Does your company undertake cross selling and upselling campaigns with any frequency?
Trying to sell dog food to someone who just bought a cat litter box is an example of cross selling gone bad. Sales enablement software help you avoid such a situation (and embarrassment), by tracking your customers’ buying patterns can be very helpful. This way you will know where their interests lie and you can pitch to them accordingly.
Usually, businesses focus more on new customers in order to get a strong foothold in the market. They often think that more revenues come from acquiring more customers. However, that is very limited approach that may well end up leaving a lot of money on the table. Keeping and growing the sales in your existing accounts is a very effective revenue driver. Did you know that new customers can cost you up to 5-10 times the cost of retaining old ones? Not just that, it is also faster to take an existing customer through the sales process than a new one.
Ever been tempted to buy a “discounted” shampoo-conditioner pack, when in fact, you just went to the store to buy shampoo? Or have that “I-made-a-smart-choice” feeling when the guy at the car wash managed to enroll you in a free premium membership since you are their regular customer? Yep, we’ve all been there.
Unlike what most people think, cross selling shouldn’t be viewed as a pushy tactic to get more revenue out of your customers. Instead, it should be viewed as an effort to meet their needs better by helping them choose the right things of which they might not be aware of, yet. It looks toward meeting and anticipating their needs and increasing their lifetime customer value. If you run a firm that genuinely cares about the end users of your products, then cross selling is for you.
Let’s look at why you should view cross selling and upselling as important revenue drivers.
1.Selling to new customers costs more than selling to existing customers
Selling to new customers involves spending more money, and—a lot of your time. Research and buying databases are your initial costs for the exercise. Then you proceed to design campaigns for them and train sales people to approach them. Since new prospects haven’t had an experience with you, they may tend to be more apprehensive about buying from you. Your sales reps may travel all the way, give it their best shot and yet land up with no sale.
On the other hand, selling to existing customers doesn’t require you to spend as much on resources. Your reps already know your customers and perhaps even share a great relationship with them. Also, a recent research study states that existing customers tend to spend 67% more than new ones.
2.It is easier to sell to existing customers
The probability of selling to an existing customer is 60 – 70%. The probability of selling to a new prospect is 5-20% – Marketing Metrics.
Newer customers are always the hardest to acquire. One of the reasons for this may be that they aren’t sure whether they want to leave their current vendor. They tend towards skepticism and may be extra cautious. Even the smallest misstep on your part can result in a lost sale (or two hundred and fifty sales, according to Joe Girard). Your loyal customers, however, may be more patient and less willing to jump ship if they have a good history with you.
How having a sales enablement software helps your cross sell or upsell
Sales enablement software helps you devise a step-by-step strategy for upselling and cross selling campaigns for your sales reps. You should also involve your sales reps in your programs (remember, they’ve met your customers) and share your plans in the form of internal playbooks. These playbooks and the data available through customer-tracking will give reps the necessary information to make a targeted sales pitch.
Also, the data that you collect through your sales enablement software will ensure that you only promote what your customers will appreciate. Plus, you also have information in your hands to add a personal touch to your communication. Personalized communication develops a feeling of trust and reliability among your customers.
And lastly, you will save a lot of money and time on your research activities. Sales enablement software will deliver extensive, yet comprehensive data that will help you understand your customers more completely, enabling you to be able to continue serving them as they expect you to.
