Everyone knows that it is significantly easier to sell more products to existing customers than it is to start a new relationship with a prospect. Thus “cross-selling” should be more than a catch phrase you casually toss out at weekly sales meetings; it should be a vital measurement and behavioral focus within your organization.
Begin the process by first measuring customer share, in addition to market share, as a key performance indicator and as a method of raising sales awareness. Market share is a well-known measurement that calculates your overall sales and prospecting success relative to total market potential. Customer share is an easily calculated indicator of sales success to your existing customer base.
Let’s say that your company sells lumber, millwork, windows, decking, roofing, and kitchens. The total sales potential for an existing customer is the sum of all products that the customer purchases in the categories you sell. Your customer share is your actual sales divided by total sales potential. For example, a builder who purchases only lumber and millwork, but not windows and kitchens might be giving you 50% customer share. A builder who buys only windows might be calculated as giving you 15% customer share. And so on.
Once you’ve measured your customer share for the key accounts in your client list, start a cross-selling game plan that works. Here are some tips:
1. Cross-selling means sales specialization. The problem with lumber salespeople is that they are “lumber salespeople.” The best sales leaders in the industry today are not product experts in one category; they are generalists who understand a lot about all the products in their portfolio. They may not be experts in all categories, but they are proficient enough to engage in quality sales dialogues when the opportunity strikes. It’s ok to rely on sales support and product expertise of your teammates and vendors. Successful cross-selling requires a salesperson to take full responsibility for understanding the products in the company portfolio.
2. Cross-selling means prospecting one product at a time. It is not enough to casually list all the products you sell in hopes that the builder or remodeler will ask you for permission to buy them from you. You must discover when the timing is right to introduce a new product; the best time do to this, but certainly not the only, is when your customer is dissatisfied with an existing supplier of a specific product. The key to cross-selling is to stop bidding “packages” and instead ensure you sell the individual value proposition of your products one at a time.
3. Cross-selling means identifying the right buying audience. Builders buy roofing materials as much from the roofing subcontractor as they do the supplier; this means selling roofing to the right audience. The same can be said for framing contractors, decking installers, and siding contractors. Cross-selling to your customers often means selling to their subcontractor supplier rather than directly to the builder or remodeler. The bad news is that you have to sell more people in the supply chain; the good news is that your target audience is dramatically expanded.
4. Cross-selling requires unique administration and delivery. Your competition in the market place is not who your prospects buy from, but instead why they buy. Builders and remodelers buy specialty products from consultative experts who sweat the details and deliver as promised, not necessarily the competing lumber yard across the street. Cross-selling experts have the flexibility to adapt to different lead times, delivery methods, and fulfillment expectations.
Treat your existing customers like prospects. Don’t ever take
your customers for granted and earn their business every day. Your professional
dedication will produce relationships that allow you to introduce new products
at the right time. It’s the best way to maximize your customer share.