Cross Selling and Customer Retention
Many sales organizations excel at prospecting and generating new leads. But they often fail to maximize the value of existing customer relationships, missing critical opportunities to capture additional revenue.
Client Case Example
A market leader in business services recently acquired two smaller firms to expand their portfolio of services into an end-to-end customer offering. The three sales forces were combined to provide a single point of contact for customers. But they were falling significantly short of their revenue aspirations and were losing market share to competitors in each service area. We evaluated the company’s sales approach and found that each component of the integrated offering had unique buyers with significant divergence in buyer values and decision processes. We recommended major changes to the go-to-market model to focus on cross-selling instead of a bundled offering.
Penetrating existing customers requires fewer resources and frequently has greater potential to yield additional revenue than hunting for new customers. Management teams cannot assume cross selling and customer retention happens “naturally”. They need to ask several critical questions:
- Does the sales/account management organization understand propensity to buy—what are the characteristics of existing customer relationships that would make them more likely to buy another specific product/service?
- Are logical solution bundles with tangible value propositions in place to meet customer buying interests?
- Is the sales force/account management properly trained in relationship selling?
- Does the sales organization balance the need for hunters (new customer relationships) and farmers (mining existing customer relationships)?
- Is the sales force/account management incented and motivated to cross sell and retain customers?
- Is there a process in place to identify “at risk” customers and take preventative action before it is too late?
Significant Revenue from Additional Services May Be Realized with Changes in the Marketing & Sales Approach
If you believe there may be opportunities to improve your revenues through better cross selling or customer retention practices please contact us and tap into our experience and expertise.