The importance of maintaining customer loyalty won’t come as a surprise to anyone in sales, but when you consider research published by Frederick Reichheld of Bain & Company that shows raising client retention rates by just 5% can increase profits by 25%-95%, the real value of your existing clients become astoundingly clear. What’s often less obvious is the true scale of revenue growth opportunity that lies dormant within your current customer base and the relative cost effectiveness of harvesting this opportunity. Some studies for instance have suggested that it is six to seven times less expensive to win additional business from existing customers as compared to acquiring new ones.
Now that we can see the importance of this component of our revenue stream, here’s five simple strategies for ensuring an ever-growing share of wallet.
1. Expand your Reach
As we’ve discussed in Account Based Selling, taking a highly focused and personalised approach to multiple points within a target organisation is a key driver of profitable sales activity. As with effective ABM strategies, a major determinant of a business’ ability to successfully grow revenue from existing customers is the development of a thorough and constantly updated understanding of who the key decision makers are within an organisation and where individual budget pools and responsibilities lie. When an account is viewed as a market in its own right, and sales leadership provides access to good data and rewards steps taken by reps to build their network within key clients, the pre-conditions for account growth are established. A market of one mindset where a rep opens multiple communication channels with an account creates all sorts of exciting opportunities for internal referrals and information sharing that can long sustain a share of wallet growth strategy.
2. Insight Selling
This approach to sustainable and profitable sales involves the identification of business flux and the internal and external pressures that dial up prospects’ needs for third-party products and services. Insight selling is ideally suited to finding new business within your existing clients and works best when that intel is used to time a new sales conversation with your account with clinical precision. Sellers with their fingers on the pulse of what’s happening within their established accounts are strongly positioned to take the strategic high ground, adding value to their customer, and advising them on their emerging needs and challenges. With the luxury of an established relationship with your existing clients, it is of course that much easier to spot essential sales fracture points and approach clients with well-crafted solutions they may otherwise not find on their own. The more you understand your customers and can see what is going on within in them, the better equipped you are to cement yourself as the trusted advisor they turn to as supplier of first resort.
3. Up-sell and cross-sell
With a foot in the door and trust established, your customer is convinced, and you’ve demonstrated your worth. Now you can work to maximise an account’s full potential. Again, the key to being able to move a client to a higher-priced option or to sell in an auxiliary product, for instance insurance or training, is to build an understanding of the dynamics at play within your customer’s business and to prioritise efforts with those where the greatest opportunities exist. Make sure you do your homework and generate a clear picture of the businesses that could be buying more of your product set but currently aren’t. Keep an eye out for customers that are on a significant growth trajectory or conversely those that face the most pressing business challenges. These could well be the members of your account set where the best opportunities lie. Educate your team on how best to spot these types of opportunities, consider introducing up-ticked commissions that incentivise and reward this type of sales, and be mindful though that effective cross-selling and up-selling is all about relevance. When your suggested additional purchases tick the relevance box, they’ll see this as yet more great customer care.
4. Loyalty through support
Nothing builds a relationship more solidly than great after-sale service in support or a solid product or service. When you surpass a customer’s expectations in this regard you’ll soon find they act as enablers, opening additional doors for you within their employer and acting as your internal champion. A key to effective after-sale service is taking the time to contact your accounts to discuss what’s working and what isn’t, always doing whatever can be done to address and resolve any issues that may have been flagged. Stay in touch, show gratitude for their business and do what you can reward them for their loyalty with appropriate upgrades, discounts and special offers. These measures will set you apart from less committed competitors and will help ensure you are the first supplier they’ll think on when they need to purchase more.
Whilst it is simple to see how these steps can power loyalty and secure more new business from your existing customers, it’s essential the strategy is planned and executed in a structured manner. Sales leadership must also incentivise reps, to ensure focus is suitably shared between those shiny new prospects and the potential sleeping giants already on your books.