The biggest business development opportunity most firms are missing

Many firms spend significant time and money trying to win new clients, while overlooking one of the biggest growth opportunities they already have – their existing clients.

New clients may seem the most exciting, but they are definitely the most challenging of my three levers of business development.

With existing clients, there are several options:

• More of the same kind of work where this is relevant.
• Additional work within the same team/department.
• Referrals to friends and colleagues.
• Work for other departments in your firm.

It is the latter that is the focus of this article – cross-selling. Or, as someone in the audience of a talk I was giving called it ‘cross-servicing ’, which I liked! It is something that most firms struggle with.

This means many firms aren’t serving their clients as well as they could, and they are literally leaving money on the table and helping the growth of other firms in the market.

In this article, I will look at why cross-selling is such an opportunity, the current challenges for most firms, and how to overcome these challenges.

Why cross-selling is such a missed opportunity

Winning clients is challenging. Once you have won a client, provided you deliver well in terms of the actual work, as well as the service you deliver – the ‘how’ you engage with them, then you should have a happy client.

It is therefore madness if that client goes to another firm for something your firm could provide. Consider the client that comes to your firm for their company accounts and VAT but goes elsewhere for their personal tax return and tax advice. Or, the client who comes to you to conduct their divorce but goes elsewhere to amend their will.

If your firm has a gap between the revenue it wants and the reality, then this is a relatively easy way to plug it. After all, according to Bain & Company in Harvard Business Review, acquiring a new client costs 6- 12 times more than retaining an existing one.

Not only that, but people also often forget that if a client goes to another firm for a service yours could have helped with, not only is that revenue lost, but if the other firm is brilliant at cross-selling, you may lose that client for the original type of work too. After all, it’s easier for clients to deal with one service provider.

Therefore, client retention is key. A main way to do that is to focus on being able to strengthen a client’s link to your firm by engaging with them in more service areas.

Why it doesn’t happen

The two biggest reasons I see in the firms I work with:

1. People don’t know enough about their colleagues’ expertise. Most people have a vague idea about other services the firm offers. However, not the real value of those services and how to spot opportunities; to be able to look out for situations when clients may have a need for those services. If they do, the engagement is limited; e.g., most law firms would mention the need to update a will in their closing letter after a divorce, but that would be it.
2. People don’t know, like, and trust their colleagues. This might seem ridiculous, but this is alive and well in many firms. Hybrid working doesn’t help people to know one another, and individuals don’t make the time to get to know people in other departments. Generally, it needs to be intentional. With this in mind, people would rather their valued client went elsewhere than potentially have a negative experience with their firm, and it affected their reputation. I understand the sentiment, and it’s true it’s a risk, but there are many instances when building the internal relationship would overcome this issue. Time and thought are needed.

Other reasons cross-selling isn’t happening:

• Individuals not thinking about the broader opportunities for the firm, focusing only on their work. This requires a change in mindset and understanding of the value a changed way of thinking can bring for the firm and their work as well.
• People not spending time getting to know their clients to understand their likely other service needs.
• People feeling ‘salesy’. Professional services are rarely superfluous and indulgent, so you are looking to help your clients more deeply and save them time looking for another service provider.
• Cross-selling not being a senior leadership focus, never mind incentivised or rewarded. If people can’t see what’s in it for them, then they are unlikely to change their behaviour.

What successful firms and individuals do differently

1. Make cross-selling an expectation and motivate/incentivise it.
2. Run events for individuals from different teams to get to know one another informally.
3. Develop a plan by team which identifies which other teams a team should get to know in greater depth (as individuals and the value they bring clients) to then work on a strategic plan together.
4. Develop people so they are trusted advisers to clients beyond the current piece of work, so they understand their needs, likely future needs, and can identify potential opportunities.
5. Celebrate successful collaboration when it happens and share it with the rest of the firm to motivate others.

What about your firm?

Do you stand out from the crowd as you are maximising the opportunity of cross-selling? If not:

When was the last time you identified an opportunity to introduce a colleague because it genuinely benefited your client? If it’s hard to remember, your firm may be missing one of its greatest business development opportunities.

If you’d like to bring in more work from cross-selling, contact me, and we’ll look at where the current gap is and how we can close it to bring in more revenue the easy way.