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Product Penetration

John Eben
John Eben
John Eben is Vice President of Business Operations at Hunter Business Group.  Jo
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Aug 13 Sales Effectiveness 0 Comment
Losing sales by not offering customers what they need?

You may have products that not all your customers are aware of.  They may have needs that you are not aware of.  

Here is an approach that can help you generate additional sales by using a matrix that uncovers hidden needs (a sample follows the listed steps below):

1.       Identify the industries or customer categories that represent 70 – 80% of your sales.

2.       Identify the product categories that are most popular across all your customers.

3.       Create a matrix, with a row for each industry, and a column for each product category.

4.       Populate the matrix with the total sales dollars for each industry and product category combination. 

5.       Then populate the matrix with the percent of sales for each industry and product category combination (% of total sales for the category)

6.       Identify for each industry, product categories that are above average for both the dollars (#4 above) and the percents (#5 above).  Highlight these as “target” product categories for each industry (shown as green boxes in the example below).

7.       Then go back to all your customers for each industry and identify customers that are NOT buying “target” product categories (green below but not “green” for those customers).  These are opportunities for providing products your customers are likely to need, are not buying from you, and are therefore opportunities for increased sales. 

Although there will always be exceptions, these “target” categories are often opportunities for increased sales by just duplicating success with other customers in the same industry that are already purchasing the respective categories. 

Matrix with “target” categories in green

Industry\Product Category

Product category A

Product category B

Product category C

Product category D

Product category E

Product category F

Automotive

High $/High %

High $

High %

  High $/High %

 
Government

  High $ / High %

High $

High $ / High %

High %

 
Education

High $

High $ / High %

  High %

High %

High $

Utilities

  High %

High $ / High %

High $ / High %

  High $

Key:

Blue = high $ for that industry

Yellow = high % of the category for that industry

Green = high $ and a high % of the category for that industry

About the author

John Eben

John Eben is Vice President of Business Operations at Hunter Business Group.  John is responsible for Hunter staff that deliver results to clients, including ensuring a comprehensive Customer Asset Management solution that delivers measurable ROI for each client.  John’s experience includes over 25 years in sales and marketing consulting and operations and over 10 years of experience in financial management.

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