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Sales Training Tip: Customer Penetration and Upselling
by Victor Antonio

If I asked any company, small business or entrepreneur to tell me who their largest customer or account is, I’m sure they’d have no problem coming up with a name. But if I asked them what percentage of the account’s market share do you own, most would struggle to give me a definitive answer.

It would be safe to say, that more often then not, we don’t own 100% of the market share with our biggest account. Said another way, we’re not the only one selling into that account. I will make the assumption that your competitors are siphoning off their fair share of the business. Many companies refuse, or make it a policy, not to give 100% of their business to one vendor or supplier. The simply don’t want all their eggs in one supplier basket.

The question which is key to our sales growth is how do we maximize our sales percentage within that account? If we can’t have 100% market share in the account, what is the most we can expect to obtain?

The first step toward answering this question begins by redoubling our efforts and focus on that specific account to make sure that we are achieving penetration at all levels. This will require going beyond the basic sales presentation or product pitches and asking more involved questions about the account. General questions to your client may go along these lines:
  • What are your growth plans for the next 6-12 months?
  • Where is your company focusing on to maximize sales revenues?
  • What are some of the cost cutting measures you’re considering?
Although these questions are very broad, you can use them as starting point to determine if there is any untapped potential. What you’re really trying to find out is what other products can be sold into this account. To do this, your questions have to more specific and related to your other products. How do you know what questions to ask? Start by doing the following:

Review what the client or account has purchased from you in the past. Review your product offering and select what other products might be suitable Then develop a list of related questions to see if there is a need or can you create a need.

If there is a need, then all you have to do is qualify and quantify that need (i.e., make sure there is a need and how big is the opportunity). If there is a need, then your job is to convince the account that you have a the products to fill that need and then propose a solution.

Think of this penetration and proposal process as a ‘Double Funnel’. You have a list of clients you are looking at revisiting. You select one (red arrow) in particular who has purchased from you in the past (green arrow). The next step is to figure out what other products (A,B, C, D) you can up-sell the client on.

In many instances you may find that simply digging deeper into your existing client’s needs will increase your sales as much as 20%. That’s a lot! If a client has purchased $10,000 worth of products in the past, a 20% increase would mean an additional $2,000. If it’s a large client who has purchased $1M, that could mean $200K to your sales quota.

The added benefit to this ‘penetrate and up-sell’ strategy is the amount of time you’ll save increasing your sales and transactional cost savings by not having to market to new clients. Sometimes the answer to the questions, “Where can I find more business?” is as close as your nearest client database.

Here’s a good exercise for you do to. Take your top 5-10 clients and list them vertically numerically. Across the top, list all the different products you offer. Then, fill in the dollar amounts of how much they’ve purchased in the previous year. You will quickly begin to see where you need to start penetrating and up selling to meet your sales goal.

Victor Antonio G.

Copyright © 2006 by Victor Antonio. All rights reserved. This article MAY be reproduced in any form or by any means, electronic or mechanical, including photocopying, as long as the author’s name, website and email address are included as part of the article’s body. All inquiries, including information on electronic licensing, should be directed to Victor Antonio.

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