A Strategy To Grow Your Sales
Selling is more complex and demanding than ever before! As well as developing as a sales professional, you have to grow sales of your territory or company. But how?
There are three simple, yet powerful, growth strategies to increase your sales. Concentrating on any one of these three areas could dramatically transform your sales figures. Selling as a strategic driving force is an inexact science. However, today, basic selling practice and best selling practice strategies apply more than ever. Here are the three sales growth strategies:
The three best ways to grow your sales
Attracting New Customers
Increasing Your Share of Customer Requirements
Customer Retention
Let’s look at the three strategies in turn with some practical tactics to put them into action:
Attracting new customers … get more customers;
Increase your share of customer requirements … get customers to buy more of your products and services;
Customer retention … increase the number of times that a customer purchases your products or services.
1. ATTRACTING NEW CUSTOMERS
Attracting new customers is about increasing your customer base. The perennial question in a sales driven company is how do you acquire more customers and increase your market penetration?
Here are 10 ways to increase your customer base:
(i) Develop word of mouth power
Develop a system to keep in touch with and continually communicate with current and past customers. Ask for their help. This will help you to develop residual business. A strategy to ‘keep customers’ is a blind spot for many businesses. A disproportionate effort is put into ‘creating new customers’. Contact your current customers directly by telephone, by post, by e-mail or by personal visits. Keep giving them compelling reasons to do business with you. Don`t be naïve. Your competitors are constantly selling their ideas too. Today, loyalty must be earned and re-earned.
(ii) Be clear about your uniqueness — your unique selling proposition [USP]
Every point of contact is an opportunity to resell your uniqueness. Your uniqueness is made up of the features, advantages and benefits that distinguish your products from your competitor. But your competitor can easily replicate these product differentiators. Today, the “soft” differentiator — the high calibre of the relationship you provide — is the best way to outsell your competitor and it is very difficult to imitate.
I regularly ask business owners/managers and their staff: `What is your unique selling proposition?` or `What is it that differentiates you from your competitors?` I ask them to jot down their answers on a piece of paper. Most people are unsure or unclear — the answers are not top of mind. When I do squeeze out half a dozen or 10 USPs more lack of clarity arises in ranking their importance. It is imperative that everyone in your company knows and agrees your No. 1 USP, then your No. 2 etc.
(iii) Make more sales calls
To increase your sales in business-to-business markets, your obvious first step is to knock on more doors. This is good up to a point, but it is a hard slog and it involves hard selling and desperation sometimes. Sales people need to be very well trained and totally professional to maximise this approach. Everyone can make an extra two or three calls per week. Prospecting is a vital selling skill that many people avoid.
(iv) Ask for Referrals
In business-to-business markets, ask for referrals. This is probably the best way to get introductions to new potential customers. Yet, surprisingly few sales people employ this methodology on a systematic basis.
It really only works well when there is a good relationship between buyer and seller. By ‘doing good work’ you will automatically get introductions. It costs very little to ask `Who else do you think would be interested in talking to me about my product?` or `I am expanding my business and I would appreciate your help.`
(v) Take Away the Risk
Human beings have been conditioned to have a fear of loss. Some are even more risk-averse than others. They are afraid of making mistakes no matter how small. They fear making a wrong choice because they may look silly. Therefore, taking away risk by giving a free trial, delayed payment, or 100% guarantee can take away that initial resistance and buyer`s remorse. A good customer relations person will identify the risk-sensitive or risk-averse customer in the bat of an eyelid.
(vi) Form value-adding partnerships
Value-adding partnerships are an effective and an interesting way to develop contacts and new customers. Many non-competitors with the same customer base use their combined resources to mutually benefit each other.
(vii) Use Advertising
Advertising is one of the most widely used marketing communication techniques. It undoubtedly plays a more important role in consumer markets than in business to business products.
Advertising can allow you to get your message quickly and cost effectively to both prospects and customers whether by mass marketing advertisements or by more precise, targeted advertising. If advertising is part of an integrated marketing campaign, it can, of course, greatly reinforce the effectiveness of all marketing activities.
(viii) Direct Marketing for One-to-One Precision
Provided your objectives are clear, direct marketing can be one of the most versatile and precise customer communications methods in either business-to-business or consumer markets.
Effective database management is the key to success. It helps to build more detailed profiles of markets, market segments and individual customers. As part of an integrated relationship marketing campaign, it really adds value and strengthens the role of advertising, public relations, direct mail, mail order, telemarketing and personal selling. This is because of its one-to-one precision, immediate impact/action, and measurability.
(ix) Do Telemarketing
Telemarketing is becoming the new way to do business nationally and internationally. The boom in telemarketing is set to continue. It is deceptively simple to operate. Yet the secret is a disciplined, systematic, long-term approach. Telemarketing can take two forms:
1 Inbound, where the prospect, or customer, calls the company in
response to an offer or to get further information, and
2 Outbound, where you take the initiative to make direct contact over
the telephone as part of an integrated campaign to:
· Follow up sales leads
· Sell directly
· Carry out market research
· Support the sales force.
It can be selective, precise, flexible, fast response and measurable. After doing a mailing to a past, present or prospective customer, a low pressure, information-orientated telemarketing follow-up can increase results by 300 to 1,000 %.
(x) Become an expert … Educate your customers
A great way to establish yourself as being different and an expert in your industry is to conduct special events, executive briefings or send free worthwhile information to your prospects or customers. People like to feel safe in what they are buying and with whom they are buying it. Buying is primarily emotional but if you can add safety, credibility and information to your basic proposition, then it not only helps get that initial sale but also long term residual business. That`s keeping the customer!
Virtually every business has opportunities to educate customers and give them valuable free information. Don`t assume that your customers are not interested. Special events, briefings and extra services increase the perceived value of your service through better customer understanding and education. This can allow you to increase your margins.
First do your homework. Read everything about your product that you can, and identify and keep abreast of trends and forecasts. Write articles for trade journals that you can give to customers and prospects. Give seminars in your market area or team up with others. Get on local radio and in the press. Write a book.
Everything adds up. Just do it. You probably have more knowledge and expertise lying dormant in your brain than you appreciate. Sell it. Use it.
2. INCREASE SHARE OF REQUIRMENT
How do you get you customers to buy a relatively higher share of their needs from you rather than spreading their spending across several of your competitors? Customers are driven by choice and there are only a finite number of choices. You are competing to win more of this choice.
One of the best sales strategies to grow revenues is to increase the average transaction value per customer. To do this you can focus on improving professional selling skills with your integrated relationship marketing, and developing a culture of outstanding customer care. Here are the strategies:
(i) Sell to people in the buying mood
Have everyone in your company focus on the importance and implications of up-selling, cross-selling and selling complementary and ancillary products.
I recently went into a camera shop to buy a cassette for my camcorder. It should have cost me about €12. However, I left the shop having spent €60, feeling very good about my purchases, but on reflection realising that a real professional had just sold me €48 more than I had anticipated.
My favourite clothes shop always sells me extra ties, shirts, shoes, and socks when I am buying suits from them. At sales time, they have a coffee dock where you pour yourself a drink. At Christmas, they even have alcohol. They`re so nice, you feel (almost) obliged to buy something.
Here`s an example of a lost opportunity. I went into a hardware store to buy some paint to decorate a bedroom. When I got home, I found that I had no paintbrushes. Had the sales assistant suggested other odds and ends that an obvious DIY enthusiast might need, I would probably have bought paintbrushes and a paint scraper and perhaps a roll of masking tape. Lost sales. I borrowed the paintbrushes and a scraper from my neighbour.
When your customer is in the buying mood, it is always easier to add complementary and ancillary products than try to resell these products at even a much lower price product at a later point.
By packaging complementary products and services together you can create a higher perceived value. Through this method you can employ an important negotiating tactic of giving something of high value to the customer, but of relatively low value/cost to yourself.
To gain long term credibility, be sure that the add-on is of legitimate value and benefit to your customer. Car dealers are masters at up-selling from providing servicing, to selling spare parts, to selling accessories, to selling finance. Banks are cross-selling additional products and services all the time. What about hotels? Airlines? Restaurants?
The basic concept of a quarterly, half-yearly or annual consulting or service contract can be applied to virtually any business. It keeps you in touch and keeps your customer. Keep thinking of ways of keeping customers for sustainable competitive advantage.
(ii) Increase Prices
A very simple way to increase your average transaction value is to increase your prices and hence your margins. Many businesses are obsessed about how their price is set relative to the price charged by their competition. This is nonsense. If you differentiate yourself by employing the techniques outlined in my book Successful Entrepreneurial Management: How to Create Personal and Business Advantage, you can actually gain credibility and stature by charging higher prices.
You have bought products from as simple as a writing pen to as significant as family holidays, because of who you were buying them from, where you were buying them and the prestige value or branding associated with them.
We pay extra for professional advice, service and products all the time. Stop reading for a moment and look at what you are wearing or using within eyeshot right now! Is there anything there that you could have bought for a lower price? Of course there is. So stop being sensitive to price. And apologising for it. Or being fearful of it. Concentrate on improving the value that you are offering. Focus on differentiating your offering. Then sell the difference.
(iii) Lock in to long term relationships
Another method of increasing the average transaction value of your product or service is to offer larger units of purchase over extended periods of time. Think about `locking in` your customers to just do business with you. Then add ‘relationship’ value.
Magazine subscription companies are constantly trying to get you to pay up front for two and three-year subscriptions rather than buy it on a monthly, quarterly or even yearly basis. Virtually every business has some opportunity to do this. A hairdresser offers the fifth visit to her salon free of charge.
Capital equipment sellers realise the service contract is what makes the `life-time` possibility possible - the second and subsequent sales cost relatively less time and effort. The objective is to keep the customer coming back and giving them a professional service so that they will stay long term.
3. CUSTOMER RETENTION
The third way to grow your business is by increasing the frequency of purchase — get your customer buying on a more regular basis. How do you keep them loyal to you and discourage them from switching? Your company may pay too little attention to customer ‘churn’! What customers are leaving you? Why? Where are they going? Can you get them back?
To increase transaction frequency you can focus on continually innovating, reinventing and researching and developing new products and services that can add value to the original products you sold them. Or simply offer customers a new range of products.
How do people know that you are striving to be the best in your field, and that you want to keep them continually doing business with you, and that you are offering above and beyond the average selling proposition of your competitor?` The answer is simple. You tell them, you educate them, you inform them. You develop systems to keep in touch. People are not telepathic, they don`t care and think about you as much as you think they do. Just don`t make assumptions.
There is no magical fomula to grow your sales. However, marginal improvement in these three areas can transform most sales results especially if you focus on a well-defined customer segments. Understand the mechanics of these three drivers can provide a platform to make better strategic decisions with regard to sales results.
John Butler is Managing Director of Century Management and the author of the best selling book, Successful Entrepreneurial Management: How to Create Personal and Business Advantage.
His new book Know Yourself, Know Your Customer will be published shortly. For information contact: 353-1-4595950 or email: butlerj@century-management.ie
