Upselling. The most important thing in your business.

I've made a bold claim with the title of this blog.

And it's not just a hook for attention.

If you don't believe me then check out all my previous blog titles here and see how bad and un-SEO-friendly they all are.

I genuinely believe that if you're running a service based business, there is nothing more important to your growth, profitability and sanity than upselling.

If you can get it right, then it means that for every new client you win, you're really winning two. Because you can be confident in your ability to grow the fees once their contract starts.

But there are also many benefits to upselling beyond the obvious (money).

And there are tricks you can use to encourage your employees to do more of it.

I would go so far as to guarantee that if you take the time to read this blog, and figure out how you can implement bits of it in your own business, you will be a lot happier and richer within 12 months.

But as I'm not charging for this advice then it's probably not worth the risk of legal backlash.

So, for the record, I'm not guaranteeing it will make you richer. But it will...

Upsells - making money

Lets start with the exciting bit. Making more money. Often not just revenue, but margin. If you can sell more services to a client, but not need to increase headcount to deliver it, then it's all margin. And if you do need to hire, it'll still be far more profitable, as it's only one client to manage, invoice, chase for payment etc.

So what exactly is an upsell? Well in my book it's simply more revenue from a client you already have. That might mean selling additional things, or just more of the same. Here are some ideas...

Reduce retainer scope

The first thing you need to do when planning an upsell strategy is work out what to sell. This will be made more difficult if you are already offering a 'full-service' retainer to your clients. It's difficult to take back things you've already offered to existing clients, but for new pitches you can experiment with removing specific services from the retainer, that you feel add enough value to justify an additional fee at a later date.

Additional services

Selling additional services is the most obvious form of upsell. This works best when it's services that enhance the performance of your core offering. So have a whiteboard session (showing my age) with your client teams to ask them to list everything that impacts the work they're doing for their clients. They're on the front line and will have the best idea of what levers you could pull, or what things are hampering their performance.

A great example of this would be an agency running paid social ads. If they could create better ad creatives then they would probably see better results from the paid social campaigns. So this is the perfect upsell, where they would charge a client additional fees for the ad creative/content, and in turn this would improve the performance of the core advertising service.

Or slightly more curveball. You're an ecommerce agency, optimising product pages for maximum conversion. You notice that the real barrier to conversion for your clients is stock availability. In this instance you could hire a supply-chain professional who could offer consulting on forecasting. Super niche, but it's a problem that you know your clients have, and solving it would make your core conversion optimisation work better.

Additional countries

I see occasions where agencies are running ads on Google or Facebook and not charging separately per country. Big missed opportunity. If a client comes to you asking for you to manage all of Europe, then maybe encourage them to start with fewer regions. This lets you build real value in the first region, and therefore be able to justify a decent fee for the next country and the next one.

This also opens up additional upsell opportunities for content localisation and translation etc.

More of the same

Hopefully you have a commercial model that is linked to performance in some way. Maybe it's a commission on sales, or a percentage of ad spend.

We would always highlight the clients that had performance bonuses in our internal reports, because they were our opportunity to fill in gaps in revenue on a monthly basis. Selling more of the same is much quicker than having to pitch new services or new regions.

For example, if you are earning a percentage of ad spend then it's your job to justify opportunities for the client if they spend more. Not just increasing the budget for the sake of it, but maybe you can identify a way to drive new to brands customers if they over invest, or get quicker traction for a new to market product. If you can justify the additional spend, and help your client sell it internally, then it's just pure upside for you.

Upsells - the hidden benefits

Now I love money as much as the next founder. But these were the two reasons I loved upselling so much.

Temperature check

How many times have you woken up at night and imagined what would happen if client A resigned, or that you have 50% of your client base on 30 day notice periods? No matter how good a business you are, you're always a handful of client resignations away from a mini-crisis.

Upselling is a great way to help you sleep at night. Not only does it give you confidence that a client buying more from you is most likely happy with the service they're getting. But also the process of scoping and selling the additional service will give you a much better insight into their business.

We ran a weighted pipeline for all of our upsells, and even the opportunities on there that weren't closed gave me confidence that they wouldn't even be entertaining an upsell if they didn't like working with us.

A much more productive and profitable way to take the temperature of your client base than simply asking them if they're happy.

Retention

This goes hand in hand with the above really. The more services and regions that you support your clients with, the more sticky you become.

Your clients are other agencies prospects. There's no getting away from that.

So the more problems you solve for those clients outside of a standard agency scope, the harder it will be for a standard agency to kick you out.

Upsells - get your team on board

So hopefully as the business owner you are fully on board with upselling being vital to the future success of your business. That's step one. The slightly trickier job is to get your team as enthused as you are. Lets face it, most people hate the idea of selling.

The solution? A combination of reframing and trickery. Morals aside for now please.

Trading meetings

It's quite possible that your client teams don't have any idea about the finances of your business. They're possibly only focussed on the performance of your clients business. That's very common and understandable.

The best way to cultivate a commercial urgency within your wider business is to make it a KPI that they need to care about.

Give your account managers a revenue target. And not the revenue of their clients. But the revenue that their clients bring to your business. This is the only way they will learn to care and understand it as a metric.

At my agency we had weekly trading meetings with the full client teams. The only conversation during those meetings were of our company revenue by client. For the clients with a performance model, we would identify how we were tracking versus forecast, and identify opportunities to drive more revenue. For the fixed retainer clients we discussed upsell opportunities.

The client teams still had their own weekly meetings to talk about client metrics and performance, but for that trading meeting it was all about our own revenue. It took a few months, but quickly became ingrained in the team that our revenue was the metric that paid the bills and the bonuses.

Incentivise them

Once your client teams are thinking about revenue and upsells, then you have the opportunity to reward good performance.

Commission for upsells works really well, as people can easily work out how much money they'll make personally.

But don't try anything too complicated as it can backfire. See my blog on potential pitfalls here.

Auditing not selling

And finally how to help members of your team that are adamant that they're not sales people.

Try reframing it from upselling to simply presenting missed opportunities.

You can even systemise it to remove the emotion if that helps. I would guess that most businesses will send clients some kind of weekly or monthly report. Often these are just a dump of data showing what you've done.

Really these reports are an opportunity for you to pitch. We would make the final slide of our monthly reports 'missed opportunities'. Basically a list of revenue or opportunities our clients missed out on because they weren't taking one of our services, or active in another country or spending too little on ads.

And our client teams would simply be auditing each month and listing the missed opportunities. Which is basically selling, but auditing is a much easier request to make!

You'll notice the banner below is on all my blogs. Usually I just pop it there in case someone sees some value in working with me. But this week, because upselling is something I'm so passionate about, I'm going to be a bit more proactive.

If you are running an agency, and not generating at least 25% of your total new business through upsells, then please book a call on the link below. I charge £500 per month for the monthly mentoring. Basically because I love doing it. There is no possible way that I can image where I won't make the businesses that I work with 10 times that at least. So, if I was you, I'd book in a call. Because I'm almost at capacity for the year and I want to help as many businesses as possible. Pitch over (apart form the banner below).

Oh and don't worry. I won't try to upsell you anything once we start...