How to Sell Strategically

If you want to maximize your sales performance, take a strategic approach to selling. After all, wouldn't you agree that "the 80/20 rule" applies to customers, where approximately 20 percent of customers produce approximately 80 percent of sales?

The starting point for strategic selling is figuring out a) which customers produce the bulk of your sales, and b) what they are buying. Armed with this information, you can strategically plan how to increase sales.

Critical Data Elements

If you want to sell strategically, you need to have access to specific data elements. Plus, you need to be willing to perform data analysis.

Which data elements do you need? This list provides a reasonable starting point:

  • Customer Name
  • Revenue by Month by Customer
  • Gross Margin or Gross Profit by Month by Customer (this is only necessary if it impacts your performance measurements)
  • Product or Service Name (for each product or service purchased by each customer)
  • Product or Service Quantity (for each product or service purchased by each customer)
  • Product or Service Unit Price (for each product or service purchased by each customer)
  • Product or Service Extended Price (quantity x unit price)
This data can be used to analyze the buying habits of your customers. Sort it in various ways to answer the following questions:
  • Which customers buy the most from you?
  • What is the trend for each customer's purchases? Are they buying more or less when you compare the current month to preceding months? How about when you compare the current month to the same month in the previous year?
  • Which products or services are they buying?
  • Are the amounts purchased in line with your expectations and the commitments that have been made by your customers?
  • Which products or services are they not buying?
  • Why aren't they buying these other products or services?
Once you have completed the first stage of analysis, consider this next set of questions:
  • How much time should you allocate to each customer in your territory? (Tip: You should spend 80 percent of your time with the customers that buy the most and/or offer the greatest potential for sales growth.)
  • What is your plan for increasing sales to each of your customers? (This includes selling more of what they have already been buying, and selling other products or services that they haven't purchased from you previously.)
  • Which new prospects should you pursue? (Tip: Which prospects can your existing customers refer you to? Which prospects have the greatest potential to produce significant sales?)
It may not be easy for companies to extract the data that is required to support strategic selling. However, arming salespeople with this data is the best investment a company can possibly make. Strategic selling enables salespeople to maximize their sales, which in turn maximizes the company's overall sales and profitability.

How frequently should the data be made available to salespeople? If sales cycles are relatively short, it would be ideal for the data to be available on demand, with the minimum frequency being weekly. For longer sales cycles, providing the data on a monthly basis may be adequate.

Strategic selling begins with data availability. If you are going to maximize sales, you need to be able to analyze your customers' buying patterns to determine how to prioritize your efforts. Which customers should you spend the bulk of your time with? How much time should you allocate to each customer? How will you increase sales to specific customers? Which new prospects should you pursue?

Plan your work, work your plan, and compare your results frequently against your quota and personal goals. Sell strategically to maximize your sales, minimize unpleasant surprises, and maximize your earnings!

Copyright 2005 -- Alan Rigg

Sales performance expert Alan Rigg is the author of How to Beat the 80/20 Rule in Selling: Why Most Salespeople Don't Perform and What to Do About It. To learn more about his book and sign up for more FREE sales and sales management tips, visit http://www.8020performance.com.

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