Introduction.
‘Product Density’ is the number of different products a customer buys from your business. Introducing other products and services to an existing customer is commonly referred to as ‘cross selling’. It’s well known that it’s far more expensive to win business from a new customer than an existing customer, so we often wonder why companies don’t take easier opportunities to win more business from existing customers?
The Business Case
Recognising the challenges companies face to grow top line revenue and improve bottom line results, why not release the untapped value of existing customer relationships?
The business logic behind product density is well known, but often poorly executed.
The cost of sale to existing customers is significantly less than for new customers.
- Customers are more likely to buy other products from companies with whom they already have a relationship – you’ve proved your credentials.
- The better a customer knows your business, the more products they will buy and the better your sales conversion rate will be.
- The greater your product density the more ‘sticky’, loyal and profitable your customers will be.
A quick Product Density checklist
Are your customers aware of all the products and services that your company offers?
- Do you have a communications plan for new products, product updates and enhancements?
- Do your customers know who in your company they should contact about a particular product?
Overview of our Product Density Programme
1: Product Information
Products and Services List.
Organise Product Information in a template format.
Product Fact Sheets – signed off by product specialists.
Product Library – held digitally on your company’s intranet, sales system or network.
Changes to product information fed through from the Product Fact Sheets into Marketing Collateral.
2: Creative and Design
Product information in coordinated design style.
Product Guide – overviews / summaries of products by product group; key contact for each product.
Product Briefs – more detailed product information; propositions and key selling points; product team contacts.
Product Density Toolkit – guide to product density/cross selling tools and techniques (internal only).
Improving product knowledge across the company.
Application of product knowledge.
Embedding a product density culture in the organisation.
Updates on Product Information fed through into Marketing Collateral, Distributor and Customer Communications and Product Training.
Tracing products along their Product Life Cycle; renewing and replacing products past their peak to maximise revenue and profitability.
Customers, distributors and employees are better informed about your company’s products.
- Reduced cost of sales.
- Higher conversion rate on sales opportunities.
- Improved customer retention.
- Product information is more accurate and consistent across all media.
- Product Management process maximises product revenue and profitability.
TAKING ACTION
If you’d like find out more about Product Density please email info@greentriangle.biz
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