How to Drive Sales Within Your Business
Understanding how to drive sales more effectively means understanding how your customers are interacting with your product or services.
Every business relies on selling some kind of product or service to make money and adjusting profitability either comes from increasing the money made by these sales or reducing the cost of making these sales. Increasing the number of sales you make at a price that does not exceed the value of these sales is a fundamental driver of business growth and should be high on the list of management aims for any executive officer.
A key aspect of developing your sales strategy is by working out your customer touchpoints – the moments of your business marked by interactions with customers.
For example, the customer touchpoints for a car rental service could be the website that customers use to book the rental; the confirmation email they receive after they have chosen their car and dates; the physical interaction when they collect the car and then the interaction when they drop the car off.
You should look for ways to make sales or upsell an already bought product or service at every touchpoint, in ways that do not overwhelm the customer and detract from the quality of the service. Utilization of this technique should be appropriate towards the business model you use – if you are a budget, low-end brand, then more driven or tenacious upselling techniques are more tolerated by the clientele. Luxury brands, however, suffer if they are perceived by clientele or even prospective clientele to be desperate for the sale.
The best businesses are creative with their utilization of touchpoints. Technically, in the case of the car rental example mentioned above, every time the renter uses the car, they are interacting indirectly with your business. It would be difficult in this case to upsell without hassling the customer, but a potential non-aggressive upsell could be to have a container accessible to passengers that offer snacks or other refreshments similar to a minibar in a hotel room. Upselling can even increase customer happiness when done correctly.
If you are making sales directly, it is crucial that you know the basics of negotiation. If you are in any business where you may offer discounts or where pricing is not as clear cut, negotiation is a vital skill. It can also be very useful in businesses where you typically have clear cut pricing. For example, if you work in retail and you have piqued a customer’s interest but think they are not likely to buy, knowing negotiation tools like logrolling can help to cement the sale. Consider negotiation lessons, or if you want to teach your staff how they can negotiate to drive sales you can find in-house programs, like those offered by karrass.com, that can teach the basics of negotiation to a large group of people.
Refining your product or service is also crucial, as competitive forces in business drive down prices. The Porter 5 forces are a good way to analyze competition in an industry environment. Look for threat of new entrants, bargaining power of buyers, threat of substitutes, bargaining power of suppliers and rivalry among existing competitors. In the case of the latter, quality differences, brand differences, customer loyalty, and switching costs are important differentiators between you and your competition. Utilize these in different ways to drive sales.
To refine your product and increase the quality of your product and brand, it is important to identify your ideal customer.
You can do this by looking at what your product/service does and who it would benefit most. Demographic information can be useful here, identifying data regarding gender, sex, education history, average income, and social class can be very useful tools, especially if you use online tools to sell your product/service.
Targeted advertising, for example, using Google Ads, can help you solely target your ideal customer’s demographic, and thus increase profitability by reducing marketing cost. Once you have isolated your ideal customer, begin the process of continually improving what you offer to meet the ideal customer’s need.
Obtaining feedback from customers is very useful in this respect, and negative feedback is more valuable than positive as it can help you find and close the loopholes of your business model that may increase customer churn. Offering something valuable to prospective customers and showing them how your offering can improve their lives is probably the best single target you can set yourself. Quality control becomes an important part of this target, as you want to offer high value to every customer.
Set a quality goal and then determine how you will measure that quality; this can be quantitative (e.g. food or drink companies performing chemical analyses on random samples of their product) or qualitative (e.g. measuring customer satisfaction after they have used or as they use your service). Finding a price that allows you to be profitable while being in line with how your customer values your offering is difficult but crucial in driving sales – customer feedback can help you find this price point, and you can ask them directly if they think the product is priced correctly.
Increasing your switching costs can help you drive sales from repeated customers. A famous company that created an incredibly effective switching cost strategy is Apple. By integrating their products and services such that you use multiple Apple products/services simultaneously, they make it harder for customers to stop using their products and services as customers would have to find replacements for each offering they use. For example if you are listening to music on an iPhone, their user interface is highly different to competitors, you will potentially use Apple Music (although they had higher switching costs when iTunes was relatively new on the market), iCloud and Apple headphones that are designed to work best with Apple devices (for example Dr. Dre’s beats headphones or Apple’s ear pods).
Driving sales may be easy to strategize on paper, but the practicalities of implementing your ideas can be very difficult. As a result, look for simple implementations and be persistent with your creativity. If one technique doesn’t seem to be working, pivot your strategy and follow the numbers.