The Benefits Of Companion Selling
by Steve Yoder
Consumers are becoming smarter. They are attracted to finding deals and cutting costs. As a business owner or manager, this presents a challenge. It also presents an opportunity to grow business and add value to customer relationships. It is important to maintain a competitive edge to lure and maintain customers. It's equally as important not to sacrifice too much in the process but to maximize the potential of business relationships and selling opportunities.
Companion selling has become an increasingly effective tactic that benefits both buyers and sellers alike. When done correctly, it can benefit any business. Continue reading to learn more about companion selling, the way it boosts sales and improves company bottom line.
What is Companion Selling?
Companion selling, also referred to as "cross-selling" or "suggestive selling," is a tactic sellers use to group and sell products or services across sub-categories. For example, work gloves may be sold with other personal safety gear as companion selling items. From a service perspective, an airline may provide a premium service package, if a passenger is willing to become a primary partner.
How Can It Help Your Business?
Companion selling is a solid business model when selling related products or services. After all, your customer needs to purchase multiple products anyway. It only makes sense to consolidate their purchase under your roof. Here are a few direct benefits businesses can expect when companion selling:
- It’s an incentive to do business with your company. Customers are eager to simplify and consolidate purchases. When a single company is willing to offer companion selling items and more items needed for a job, it makes consumer decisions much easier. It saves the customer the cost of doing business by eliminating the additional purchase order as well as the time required to source and acquire the needed product.
- It can boost customer loyalty. Loyalty and customer satisfaction go hand-in-hand. Companion selling keeps customers or partnering businesses happy by eliminating the necessity to shop around and allowing them to save money. It is an excellent way to keep customers from becoming exposed to competitor brands or potentially moving to other competing suppliers.
- It’s good for employees. Companion selling can transform a mundane sales task into a more fulfilling and thoughtful sales task. It gives sales staff goals beyond the close of a deal. It gives them an opportunity to shoot for a long-term sales goal based upon a diverse range of products or services. The convenience of adding many of these items reduces or eliminates pricing scrutiny. It can also allow for increased margins on transactions while growing sales.
What Should I Consider When Companion Selling?
Companion selling is an excellent tool if it makes sense under your existing business model. Below are a few considerations when deciding whether to focus on companion selling opportunities.
- Does it make sense? It's important to have a plan when bundling products together. There must be a clear connection between the bundled products and a reason for your customer to consider making the purchase. Otherwise, your effort to companion sell will come across as a hollow ploy with no value.
- How do I decide what products best fit the criteria above? Think of other products typically purchased with a specific product. Then, choose those typically purchased products as companion products. For instance, driver bits are needed to install a screw. Rod couplings and Drop-In anchors are typically placed on threaded rod orders. Quotes for jack chain usually incorporate V-Hooks for hanging fixtures as well. Reviewing past job quotes and orders can be an effective method to determine which products to suggest as companion products. Companion selling can be a significant, ongoing way to help grow your business.
When done right, companion selling is an excellent tool to keep your business competitive. Take the time to assess your business needs and product offerings to determine whether a sustainable companion-selling initiative is right for you.
Steve Yoder is the vice president of National Accounts for Minerallac. Minerallac is a family-owned American manufacturer and distributor of electrical construction hardware and fasteners located in Hampshire, Illinois.