5 Ways Distributors Can Increase Consumer's Share of Wallet
In Modern Distribution Management’s wholesale distribution industry outlook earlier this year, nearly 60 percent of wholesaler-distributors said they planned to grow revenue by focusing on sales opportunities within existing customers.
Expanding wallet share will always be one of the best growth strategies for distributors in this increasingly competitive market. We worked with one specialized distributor who empowered their sales organization with data-driven product recommendations that in some cases doubled wallet share with their current customers, and drove more than $6 million in annualized revenue growth.
How to Increase Customer Share of Wallet
More customers are moving toward a one-stop buying experience and the efficiencies and cost savings that come with that. How can distributors capitalize on this opportunity? Start with these five tips to increase wallet share:
1. Recognize your customers don’t know what they don’t know.
Even your most loyal customers probably don’t know the entire breadth and depth of your product offering. Your wallet share strategy should start by uncovering trends in your transaction data to better understand what similar customers buy from you. This will allow you to identify purchasing gaps – and therefore – sales opportunities that you can act on immediately.
2. Optimize all sales channels to make it easier for customers to do business with you.
Today’s market is all about making it easy to do business with you. That’s what Amazon has excelled in, setting the bar high for expectations in both the B2C and B2B markets. Some distributors are targeting existing customers—rather than new—with their e-commerce platform to increase wallet share, recognizing it can make it easier for them to reorder, without the need for contact with an outside sales rep. E-commerce also offers an ideal avenue through which to offer related products your customers may currently be buying somewhere else.
3. Catch churn before it’s a problem.
Accounting for seasonality, identify customers with declining revenue and take corrective action. The distributor mentioned above that added $6 million in incremental revenue from existing customers was previously performing account-level analysis manually, which meant that sales teams either didn’t see the churn risk, or were too late to save the account when the churn was identified.
Using machine-learning and data-driven recommendations through a platform like PROS Opportunity Detection, sales teams can stay ahead of the curve, maintaining and even increasing wallet share in accounts that may be at risk of going to the competition.
4. Identify customers with sporadic purchasing behaviors.
Do you have customers that irregularly buy certain products from you? They may only be turning to you when their primary suppliers are out-of-stock. Growing sales with these customers may be as simple as digging into your data and identifying purchasing trends, and then creating a wallet share strategy that gives your customer an attractive reason to move that spend to you full-time. Some may even be eager to consolidate that purchasing.
5. Arm your salespeople with relevant opportunities to sell more.
PROS Opportunity Detection delivers data-driven recommendations to your salespeople via your existing CRM based on transactions with similar customers, purchasing gaps and declining revenue trends relative to their peers. Doing this means you’re arming your salespeople with relevant, personalized offers that customers will be more likely to respond to. In today’s market, buyers don’t want to be interrupted with sales pitches for products they don’t need. They want you to understand their businesses, so when you present relevant opportunities, they will respond.
Try PROS Opportunity Detection
PROS Opportunity Detection delivers benefits for both the distributor and customer, with a frictionless, transparent and personalized modern-commerce experience. By leveraging PROS Opportunity Detection, your sales reps will have valuable tools to increase wallet share by providing a more customer-empowered buying experience.
Learn how one distributor used data-driven, prescriptive, and actionable insights to drive over $6 million in annualized revenue growth.