It’s always great to have new customers because that is an obvious sign of a successful business. The bigger your customer base the more product you are selling and the larger your business appears. But acquiring new customers is an expensive process. A less expensive proposition is to focus some of that energy on your existing customers.
After all, these are customers that are already presumably happy with your company. They would be happy to buy from you again but may not realize you have other offerings available that are relevant to them. Unlike upselling, where you sell more of the same or a higher quality/fuller featured product to your customer base, cross-selling involves marketing to your customers in a similar way to lead generation. But it costs much less because you already have information on these customers and a tacit permission to engage them.
Discovering Cross-Selling Opportunities
Cross selling opportunities are available in a variety of ways.
- You discover your customers have needs you aren’t serving.
- You discover a new line of services or products nobody else offers.
- Customers from other departments of your company need your services.
- Additional needs are uncovered during an expanded conversation with a current customer.
- Other needs are discovered upon product or service delivery.
- New options are offered during the sales process.
Cross-selling is another way of adding value to your customers and cementing the relationship. And with the lower cost of cross-selling over new customer acquisition you can broaden your margins or offer better discounts to current customers.
Two Simple Cross-Selling Methods
Horizontal Sales Letter
A horizontal sales letter is very similar to a targeted drip or nurturing campaign. Rather than one long letter selling every service and product your company provides to every type of customer you want, a horizontal sales letter is a brief that is disseminated, not necessarily through snail mail, but through whatever communication mechanism your customer likes to use.
Horizontal news letters can be used with social media, as an offering on a landing page, as a link to a newsletter, or as a webinar series. They are short enough to make great videos or pieces of a podcast. It is an educational piece that keeps your customers in the know about your company and any new or existing products you have that could match their needs.
Your content doesn’t have to be targeted expressly to new customers. Your existing customers may already visit your website or take your newsletter. When you begin to develop supporting content for new products be sure to create some that is more relevant toward people you already do business with. Make it clear that a new service is for anyone, not just new customers.
Audit your existing content and tweak it to appeal to someone already doing business with you. And you can use content from the middle and end of the funnel much more easily. Top funnel content will also appeal but you don’t have to sell yourself as a solution provider; they already know that and trust you.
Education is your strongest tool in cross-selling. Your customers won’t automatically know everything you can do for them, especially if it’s an option that was unavailable the last time they did business with you.
Be Prepared to Cross-Sell
Anyone who has been in successful in sales has probably learned that knowing the company catalog front and back is useful. Through this type of study you can more easily identify a match for a customer need that comes up in conversation.
You need to have a way of describing all your services and products, what the deliverables are, and who needs these types of products. In addition, you must know why these customers need to know and the value the products bring to them.
In other words, you need to be just as prepared to sell to your existing customers as to a new one. Don’t let your guard down or pay less attention just because this customer is already yours. It doesn’t have to stay that way. If you don’t take advantage your competitors will.
Everyone in your business should be familiar with your offerings since they may touch the customers more frequently than your sales force. Anyone from the receptionist to customer service should be conversant in your catalog. It will be a pleasant surprise if a need is anticipated by someone who isn’t normally part of the sales process. It makes your entire company look good.
Maybe you don’t cross-sell as much as you could simply because past efforts have failed or you haven’t invested in it. Unless made aware of it, upper management may not realize the gold-mine your company sits on.
Many of the methods used to determine where revenue comes from don’t really call out specific products; often only the number of customers and how much each spends is available. There is nothing tying buying patterns and habits of existing customers together.
Here is a statistic that may wake your company up to the opportunity you are missing. According to Fiserv’s Bank Intelligence Solutions business, it can cost as much as 8 to 10 times more to get a new customer than to sell to an existing one.
It’s easy to see why. You already have their information and permission to market with them. In addition to that, people dislike change. If they can get the same thing from someone familiar they will. You are a known quantity to them; they know the kind of service to expect. Part of the stress of purchases from a new vendor is not really knowing how well the new company takes care of customers.
Cross-selling is a cost effective way to produce new revenues from existing sources. It cements customer loyalty and keeps your customer base engaged with you. And you have a ready source of feedback for future services and products from people you know.
New customer acquisition is still a vital part of your business. But don’t forget about those who got you where you are today. They still need you…even if they don’t realize it yet. It’s up to you to tell them.