How much does your company spend trying to obtain new sales leads through advertising, direct mail and other efforts? According to Kevin Pass, owner of Action Pest Control, based in Evansville, Ind., when he added it all up and divided it by the total number of leads, his company was spending an average of $153 per lead. And that was just a lead, not a close.
Around the same time, Pass connected with a Florida-based pest management firm that used Survey Monkey — a free service — to determine how many of its pest control and lawn care customers knew that the company offered termite services. The company found that 85 percent of its current clients had no idea it also did termite work.
Advice for cross selling services often suggests clover-leafing neighborhoods, direct mail efforts, and other tactics that can be time and resource intensive. However, Pass and his staff have come up with lots of successful ideas and also have tapped into other well-respected industry professionals to develop effective cross selling techniques and programs. Pass shared many of them with an attentive audience at last year’s NPMA PestWorld conference in New Orleans.
With an average cost of $153 per lead related to advertising, what does it cost to sell another service to an existing account? Very little, according to Pass. At the same time, when customers buy into more services from your company, they become more vested in the relationship because they are paying a higher rate.
“Originally, I thought that if we offered lawn care as well, we’d give customers two reasons to fire us. That’s not true at all,” says Pass. “Our customer retention rate is much higher when they buy multiple services and if there ever is a problem, the more likely they are to work through it with us.”
Getting started. In addition to finding the right services that fit your company’s business model and your customer demographics, you have to have the right people in the right roles to be successful, according to Pass. As such, he began pre-employment testing to make sure he had a desirable mix of personalities on board.
|PIG Referral Contests
He says there are two types of sales people that you can’t afford to have in your organization. One is the “lead chaser” that goes out on an ant call, and only sells the ant job. The other is the “order taker” who is never going to go beyond his or her comfort zone.
“You’ve got to get the right people on the bus. You not only need to have the right sales people, you need to have the right technicians to have a successful cross selling program,” says Pass.
In screening employees, the company evaluates a person’s sociability, agreeableness, conscientiousness, patience and openness. For example, technicians with a moderately high sociability score are friendly and outgoing, and are more likely to suggest service enhancements to current customers and ask for referrals.
Shifting focus. According to Pass, he knew he was going to have to spend a great deal of time planning the company’s cross-selling program because it would require a shift in company culture that the was going to put as much focus on sales as it does on service.
“We knew we had a big task on our hands. In the past, we were so service oriented that we had grown sales averse. We didn’t want to be sales focused because we thought the service would suffer, but we found that quite the opposite is true,” says Pass. “In recent times, with addition of a sales manager and chief operating officer, we’ve become a pretty good sales organization.”
To help make that shift, Pass and COO Keith Smith developed the company’s Partners in Growth (PIG) program, an idea Smith learned about from a previous employer. The program partners the company’s sales people and technicians to increase the amount of leads that technicians refer to the sales team.
“I had tried many times to pay our technicians for a lead. I could not imagine that a technician wouldn’t take the 30 seconds to write down a name, phone number and pest for $5, not even for $10,” says Pass. “Through our PIG program, the sales commission is split 50/50 between the sales person and the technician who referred it.”
Other Cross Selling Ideas
At first the sales people were upset, as one might imagine. However, the salespeople are able to post the entire sale toward their sales numbers, and if they hit their sales goals, they get a bonus. In addition, referrals have a much higher closing rate than a phone book lead, for instance — around 90 percent.
As Pass and his team launched the PIG program, they were sure to set proper expectations, demonstrate the impact it would have on the sales’ and technicians’ incomes, train the staff in every aspect and, to get everyone excited, ran a contest with a great prize. In fact, they’ve run several contests since its launch.
“We spent a lot of time telling our people what’s in it for them, and actually charted it all out mathematically to help them see how much more money they could make,” Pass says. “We trained on every single aspect — right down to the words that come out of their mouths. We gave them scripts to practice with so they would be comfortable with the words coming out of their mouths. You know you’ve really created a culture change when you walk into the break room and they are practicing with each other.”
All Hands on Deck
In his presentation at NPMA PestWorld 2011, Kevin Pass described a program implemented by Jeff Springer, owner and CEO, Springer Professional Home Services, Des Moines, Iowa. Pass says Springer gets everyone involved when he wants to introduce a new program, and when Springer decided he wanted to add mole control to his list of services, he did just that. After calculating the price, commission and how many customers he would need to add a route, he told all of his employees if the company was able to add 70 new clients, he would pay every one of them a $500 bonus.
“Now what kind of impact does that have? How often does the bookkeeper or the customer sales representative or the clean-up guy have an opportunity to get extra money?” asks Pass. “It was transformational. People are bringing in leads, people are talking about it and the entire company is working as a team so that everybody gets a bonus.”
One of the most important factors for Pass was finding what he calls a “rabbit” — someone who can show the others that the program works and can be successful. And posting the sales numbers helps, too.
“Because what happens when you try something new? People will say they can’t do it because they’ve never done it,” Pass says. “Our rabbit is our technician, Chris Smith. He has been responsible in a little more than two years for $112,000 in sales.”
Company wide, the program is approaching $1 million in sales. “An added benefit of the program is team work,” Pass says. “Our sales people and technicians are working together and support each other. It’s a really beautiful thing.”
Potential Cross Selling Opportunities
The author is a freelance writer based in Muskego, Wis. She can be reached at firstname.lastname@example.org.