Make It Happen

Upsell - How To make Your Customers Return
By Debbie Jenkins

It's a proven fact that the real value of a new client isn't in the first sale, but on the continued relationship, with that client either buying from you again and again (brand loyalty) or buying more from you as you introduce new products and services just for them.

Either way, the only way you are going to sell more to one customer is to keep that customer happy and coming back for more.

The following tips will help you to retain your customers and get into the position where you can sell them anything because what you offer is exactly what they need.

1. Flogging the polish works - selling the shop works better

First we'll deal with the old chestnut - "flogging the polish" - this is how it goes:

The customer buys shiny new shoes - you quickly say "would you like some polish with those?" the customer usually says "uh, yes please."

Fast food companies are masters of this technique. Have you ever been asked: "do you want fries with your order?" even if you didn't want fries you often say "yes please".

The success of this technique is based upon three factors:

1) Acting fast. You and your staff should always be prepared to say "would you like fries with that?" This is down to training - Your smiling Fast Food representative doesn't ask if you want fries because he thinks you need them
- he asks because that was what he was trained to ask.

2) Offering something that complements the first sale. The shoe shop assistant doesn't ask you if you want fries with your shoes - and the fast food rep doesn't ask you if you want some shoe polish to complement your MacSooperDooper Burger. You must design/sell secondary products and services that will go well with your primary products.

3) Making the offer relatively cheap. Shoe polish generally costs a small percentage of the shoes the customer has just bought. This makes it easy for the customer to say yes without thinking but doesn't make a huge difference to your bottom line. This is the main problem with Flogging the Polish in its most primitive form but is so easy that it's worth doing every time you sell.

Improving on this basic Flogging the polish system is to "Sell the Shop" it is harder to pull off but if done properly can greatly exceed the value of the initial sale.

Let's imagine that you sell motorbikes. Your primary product is motorbikes - you also sell other bits and bobs such as helmets, leathers, spares, tires and polish, plus you arrange/provide insurance, finance and servicing.

When somebody comes to your shop to buy a new motorbike you should aim to sell everything that the new customer will need to go with the bike - everything in the shop. Leathers, helmets, boots, gadgets and other little accessories are the polish - they will greatly increase the value of the sale but still only add up to a fraction of the price of the bike.

The real value is in the longer term contracts that can run over several years. Selling a bike with cash is much less attractive for the seller and the buyer (in most cases) than selling the bike on credit with interest on top. You can boost the initial sale value by 20% for very little work if you are willing to wait a couple of years. Also servicing is another regular money-maker - set up a contract for servicing and increase the value by £200 every 6000 miles or 6 months. Then to top the deal off you offer insurance where you can make some more money in commission.

As you can probably appreciate - the total value of these "additional" services can increase the value of the sale of a motorbike to more that it's initial worth. You should aim to inform your customer of the extras as if in conversation and be prepared for the customer to say "no thank you". If you single mindedly push every product in the shop without stopping to judge your customers reaction you'll lose the sale completely.

Once the initial purchase contract is over and you've taken good care of the customer, you then tell them about the next newer and better bike on the market and start the process again. After five or so years, a sale that would only have been worth £8,000 has escalated to be worth nearer £24,000 and if you keep on doing a good job will continue indefinitely.

2. Building a Relationship

Taking care of the customer and exceeding expectations is what the next upselling approach is all about. This one is nicer and generally more rewarding.

Once you have made the initial sale (not forgetting to flog the polish or sell the shop!) your aim should be to do such an amazingly good job that your customer will come back to you whenever they need the same again.

This outcome is hard to monitor so the second part of this approach is to always let your customers know when you are offering a new service that they may be interested in.

In fact if you build your business around your customers then all of your products should be exactly what they are looking for.

This approach can also be more versatile than flogging the polish. For example – Cabal Group's e-pay initiative (spread the cost over 12 months interest free) is a great way to get a cost effective website that will make a real difference to your business. For the price you pay you get a premier service that provides real results.

More importantly for Cabal though is that you get to experience exactly what we have to offer - a great service.

Once clients have experienced our service they do some of the following things:
- they recommend us (upselling to their friends);
- they buy our WebAIM.co.uk package for the following year;
- they use our other services such as graphic design, presentations and research;
- they are open to our suggestions for improving their success and willing to spend more money with us to get the results we can offer with new products and services.

As you can see - the power of doing a job well is based upon the knowledge of the real value of every single one of your customers. If Cabal were to do a bad job then we would lose lots of value from referrals, new projects and new developments with that customer.

Offering an initially great deal to get the chance to prove your superiority should not be underestimated if you have gauged the potential value of doing good business with that client. A good tip is to constantly remind yourself of exactly how valuable every one of your customers is. If you come to the conclusion that none of your customers are worth more than the initial sale then your business is doomed.

Don't ever rip a customer off! If you do then don't bother trying to upsell a thing - you will have already lost the real value through a greedy "get rich quick" attitude that will eventually leave you without a target market at all.

3. Ask Questions

When you are working with your customers it is important to constantly ask them what you can do better or what else they need.

You'll be amazed at how many of your customers have the same needs. It may only take a little work and you could be able to provide a service or product that meets that exact need and you'll be on to a sure-fire seller.

Once you are ready to tell your customer about your new product don't forget to tell them that it was made because they asked for it. How can they refuse?

A simple questionnaire when they buy from you may be able to give you a good insight into what they may need soon. You could also set up a forum where customers can discuss your products and make suggestions for what they'd like to see in the future.

4. Remind them what you do - again and again

Many companies concentrate so hard on telling the world about their services that they forget all about their current customers. Many times I've found out from somebody else that our suppliers have a service that would be ideal for us but that we didn't know about.

Just because you know what you can offer doesn't mean that your customers will think to ask about or buy it unless you let them know it exists.

You should use every means available to make sure your existing customers know exactly what you are up to. Use e-mail, e-zines, telephone calls, your website and good old-fashioned letters to spread the word and maintain awareness.

Your customers will appreciate it when they find out something that can help them just as they need it.

5. Don't just chase new business - pamper the old

In a market share driven world people are always after "new" business. New business is seen as sexy and makes you feel that you are beating your competitors.

The thing that is usually forgotten is that most of the business that you see as new is actually somebody else's old business. The reason that this new customer has come to you is because your competitor was probably spending too much time trying to increase market share rather than reminding this valuable customer why they chose him in the first place.

What you should do is get a balance between constantly delighting and communicating with your existing customers and stealing new customers from your competitors.

Just remember: Getting new customers is generally more expensive and more painful than selling more to old customers. So pamper the old customers first.

6. CRM is a crock of CR*P if you don't have a relationship to begin with!

Customer Relationship Management is seen as the current undefeated champion of customer care - but like the World Wide Web it's just a tool and a catchy acronym that only works if there's some substance behind the scenes.

It doesn't matter that you know the birthday of all of Mr Smith's family if you don't know Mr Smith - if you sent him a card he'd think you were after something and he'd be right.

If I received a Birthday Card from the insurance company I use it would go straight in the bin, because the staff I deal with there change so regularly that there's no way anyone would really care if it was my birthday or not.

Not only that, but when I've had a problem in the past I've been passed from department to department without anyone wishing to take on the relationship and help me to resolve it. In essence - I'm only loyal if they keep my premium down.

On the other hand - If my local Indian Restaurant sent me a birthday card then I'd be delighted because I speak to many of the staff there regularly and they take a genuine interest in me.

I'd be even more delighted to receive a complimentary meal and would probably invite lots of friends to share in my celebration. My local restaurant would then receive lots of new customers and even more loyalty from me. I'll have to suggest it to them!!!

Notice how I describe a company I like as "my company" and a company that I couldn't care less about as "the company". That's a key to understanding the power of a genuine relationship - you want your customers to refer to you as "my accountants" or "my printers" not "the accountants" or "the printers". Once they start using the word "my" - they'll buy from you again and again.

Put simply here is my opinion on CRM packages:

Using data to try and befriend customers that you don't even speak to is as shifty and Machiavellian as the slimy creep who showers you with compliments with the intention of getting you to like him.

If you need to rely on machines and systems to manage relationships then you should take a step back and look at how you and your people manage relationships first. Ask yourself some questions:

- Do your staff help clients when they call or pass them to another department until the client angrily asks to speak to you?

- When a customer asks for your name do you say "Mr Bloggs" or do you say "Joe Bloggs"? Do your staff try to avoid giving their full name to customers when there is a complaint (usually when they know they've been particularly unhelpful) or are they helpful and upfront from the outset of the call?

- Do you find time to speak to your customers in person or do you set up a barrier of self-importance and refuse to speak to any of the people that have paid your salary?

- Do you allow your staff to use reasonable common sense and judgement with regard to resolving customer enquiries or are they totally inhibited by strict and unwieldy procedures?

- Do your telephone support team refer to customers as "sir" and "madam" or do they use real names and have a system for remembering them?

Using the term "sir" is very cold and outdated – especially when the customer has already used their first name in conversation Direct Insurance companies are notorious for this when you have a complaint - they use the term sir as a way of staying detached from the "problem relationship". Notice though that when they are selling you insurance they generally use your first name as much as possible.

Once you know the answers to these questions then you can move into managing relationships better on a day-to-day basis. This may mean employee training, drawing up a set of rules for dealing properly with customers and overall cultural changes in the way you and your staff regard customers.

Only when you have good relationships should you start using gimmicks and data to impress customers.

What is useful about CRM is the ability to rank your customers and gauge their buying behaviour with your company. And so I go on to the next tip...

7. Rank your clients and reward loyalty - they'll expect it!

Rank your customers according to what they have brought back into the relationship. This should include referrals, purchases, ease of doing business, length of time they've been doing business with you and general added value from the relationship.

Use your ranking system to regularly reward these customers with special offers and invaluable information. Not only will you be reinforcing the relationship but they will expect some sort of reward for their loyalty and not delivering means you won't be meeting expectations.

Failing to meet any expectations in a relationship will make it difficult to keep that customer and that means it will be difficult to upsell to that customer.

8. Upsell to your client’s contacts

An often overlooked value of a client is "who they know". When you are certain that you have done an excellent job it is important to ask your happy customers to tell their friends and colleagues and offer referrals to you.

You could offer a reward for these open displays of loyalty in the form of cash, services and special offers.

Setting up a strong referral system will enable you to repeat your initial success with everyone else introduced to your business.

If you think that offering incentives for referrals is unethical then you have missed the point. The important part is that you do an excellent job first - if you offer incentives to customers that are unhappy then that is unethical, but if you offer it to customers that are extremely happy then you are just making it more rewarding for them to do so.

So in summary, if you want to get the best value out of each of your customers you must:

- flog the polish or sell the shop - on the first sale

- do a great job - and build a relationship

- ask questions - and make a product/service just for your customers

- remind customers what you do - again and again

- herd happy customers its easier than chasing chickens in other words Pamper your existing clients before chasing new business

- never rely on artificial techniques for managing relationships if you don't have a relationship to begin with

- rank your customers and reward the good ones

- do an excellent job for your customers and then offer an incentive for referring new business to you.

This article is an excerpt from a book called Lean Marketing™, which is in the final stages of editing.

About the Author

Why I'm passionate about sharing LeanMarketing™ knowledge with inspired professionals...

I recently looked back on my own professional life and realised just how lucky I have been to be able to do so many things that have challenged and stimulated me.

Since the early 80's I've worked as an electronics engineer, a recruitment consultant, a public speaker, a sole trader, a partner, an employer, an advertising agent, a dot.com (it's true), a business guru (if you like that label), IT consultant, marketing advisor and IT lecturer. I've spoken on radio and featured in national and local press. I've had the opportunity to help individuals, small businesses and big corporations to make money and save money and it's been enormous fun.

During this time, I've also seen things go well and things go awry. I've learned lots of lessons (the hard way in most cases) and felt frustrated at conventional wisdom not working. I've met and built friendships with plenty of inspirational people and had the opportunity to learn from (and build solutions around) some very exceptional expert clients.

But, out of all the people I've worked with, I've had the most enthusiasm, fun and reward from working with leaders of small, agile and aspirational businesses. These businesses in one way or another live and breathe the truth of Lean MarketingTM which we've captured, named and formulated into a set of tools. Coaches, Trainers and Specialist consultants have become a personal passion of my business and with our track record for providing services in this area I firmly believe that we have a lot to offer each other.

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