Before I became an entrepreneur, I ran marketing programs at a major web publisher. I was managing an uncapped media budget, which meant that I was often pitched products and services -- and on the receiving end of some very creative sales tactics.
The biggest lesson I learned from the account managers and client service leaders I've worked with is the value of upselling -- the process of growing customer relationships over time. The more time that account reps spent listening to my needs, the more they were able to help me grow my marketing campaigns, and the more I was able to spend.
Now the tables have turned and I’m the salesperson. I'm proud to say that upselling has been one of the biggest contributors to my company’s success. When my customer retention and average order values increase, so do my profit margins. The math is simple.
The process, however, is a little more complicated. Here’s the thing: I despise the term "upselling." It just sounds sleazy -- like I’m trying to extract more and more out of somebody.
But it’s this aversion to upselling that has, counterintuitively, become my biggest upselling strength. I've developed a method that takes the sales out of upselling. Here are the three steps I follow.
1) Look for opportunities to help customers succeed.
I never ever think about how I can convince my customers to buy more from me. Instead, I focus on business objectives and how I can help my clients achieve them.
To that end, I spend very little time talking about contracts and budget. Somehow, those details tend to work themselves out. And when I take a step back to look at my average order values and growth rates each month, I see upward trends.
But I never chase numbers. Instead, I focus on getting to know my customers on a deeply empathetic level. I embrace their success as my own and constantly look for ways to add more value to their day-to-day operations. If that involves them buying more from me, it's a win-win.
2) Empower customers on a personal level.
I pitch ideas -- not products, services, or solutions. In most cases, I’ll even tell my customers how to execute upon these ideas in-house. The fact is that my customers are in the best position to know what they need, and I’d rather not pressure them to think otherwise. I want them to feel inspired, empowered, and talented in their roles.
However, because I work with so many companies in the B2B software as a service, analytics, and IT industry, I have a bird’s eye view of customers’ competitive landscape. I am in a unique position to share ideas they may not have previously considered.
When I pitch a recommendation, the suggestion always comes from a spirit of genuinely wanting to help them grow. But I never make the idea about me, and I add the disclaimer that it’s my client who is in the best position to make the judgment call either way. I imagine how I would feel in my customer’s role, and I aim to be a resource to help him or her shine.
I view my company and offerings as added value -- not a money or time sink. I look for creative ways to help my customers -- the people who are championing my presence within their organizations -- succeed.
3) Be transparent about pricing.
Whenever I present a customer with an idea that involves an additional investment, I provide a detailed cost breakdown with a clear rationale for my pricing -- right down to payment rates for subcontractors, management fees, and anything else that he or she may care about.
Fellow entrepreneurs and sales leaders sometimes think I’m insane for being so open. I’ve found, however, that the strengths dramatically outweigh the costs.
While some companies ultimately choose not to work with me on a specific idea, the ones that do are often clients that are equally invested in our relationship as I am. We have a shared understanding of the value my company brings to the table, and we have developed an extremely strong sense of respect and trust. Not to mention this transparency gives my customers a say in what they think price points should be -- and after all, my business is dependent on market forces.
If we aren’t aligned on pricing, the simple solution is that we don’t work together. But even these situations are a win for my company -- every time that a sales opportunity does not come through, I have a clear understanding as to why.
What steps have you followed to take the selling out of upselling in your business?