The Importance of Targeting your Customers - Cross Selling Execution
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Total Profit Solutions for IT Companies™
The Importance of Targeting Your Customers: Cross-
Most Solution Providers have multiple solutions and Services offers. In order to deliver a Best-in-Class
return on each - and thus for the Solution Provider to attain Best-in-Class performance overall - each of
them must be sold enough to consume the full delivery capacity in which the company has invested.
In addition, generally speaking, as long as the range of solutions and Services can be delivered with good
quality and Gross Margin, each customer account should be encouraged to consume as many of the
different offerings as possible, which optimizes cost of sales as a percent of gross margin.
There are two reasons for this. First, generally the least expensive way to generate new Revenue is to
sell something additional to an existing customer with whom they already have a relationship. Second,
the more a given customer buys from a firm, generally the more dependent the customer will become
on that firm, which increases the chances the customer will stay with them for a longer period of time
and of earning a higher margin.
As a result, top-performing Solution Providers define their target customer profile carefully, such that all
solutions and Services are created in a way that all customers of the target profile can consume all the
offers. The top performing firms then focus on winning only customers that match their target customer
profile. This enables the Solution Provider to take the further step of putting methods in place to ensure
that most accounts do buy more of or all of the offers of the firm. This is called cross-selling.
Top-performing Solution Providers have tightly integrated cross-selling goals into Sales compensation
and added minimum-expected performance in cross-selling below which the Sales representative
compensation is negatively impacted.
These firms also do full account planning for and with each installed base customer to identify cross-
selling opportunities. They then integrate these opportunities into their Marketing and Sales motions to
each customer, as well as Service's delivery of Quarterly Business Reviews.
The customer-facing team is involved in the account planning process and each, including the Service
team has a role, responsibility, and an element of their compensation, tied to driving cross-selling
The two primary aspects of the company that are impacted by this Trait are the profile of the customer
being targeted and the portfolio of offers that being delivered to these customers. Specifically:
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• Aligning the offers so they can all be sold to the target customer profile; and
• Targeting the customers so they are increasingly “the same” against the characteristics that
allow Sales to sell and Services to support the same offers.
This requires bringing Sales and Marketing together with Services and Finance to agree on the target
customer profile, as well as the solutions and Services to offer these target customers. Additionally, top-
performing Solution Providers conform the measurement and the management of the company to
increasingly deliver all offerings to a customer base that is increasingly of a common, targeted profile.
These changes start externally with marketing efforts directed towards qualifying prospects within the
target customer profile. Then the Sales team can reconfirm the prospects are within profile.
Maturing this Trait will drive steadily improving ability to analyze the installed-base of customers. This
allows the firm to more easily assess whether prospective customers are a fit for their specific target
profit, and consequently, the whole portfolio of offerings. Improvements will be recognized across the
organization from strong execution in cross-selling.