Like most other businesses, those in equipment rental are always aiming to boost their revenue. Using the latest technology to improve process efficiency, resource utilisation and business visibility can help you with this aim. But it’s not the only thing you can do. You can also focus on selling additional products/services by way of up and cross-selling.
What’s the difference between upselling and cross-selling?
If you’re confident you know the definitions of these two words, skip to the next section by clicking here. Otherwise, let’s quickly define these terms and show why they shouldn’t be used synonymously.
- Upselling - encouraging a customer to buy a better version of a product or service
- Cross-selling - encouraging a customer to buy another product or service that’s related to or complements the one they’re buying/browsing
Can you see the difference? An example of upselling would be encouraging a customer to upgrade to the latest version of an ERP system rather than an older piece of software - such as Microsoft Dynamics 365 Finance & Operations (D365 FO) over Dynamics AX2012. Cross-selling would be selling them Dynamics 365 Customer Engagement in addition to D365 FO.
Both have the same outcomes - they will boost your revenue and customer satisfaction - so it’s easy to confuse the terms.
How to up and cross-sell effectively to boost equipment rental revenue
Photo by Anna Shvets
1. Know which products/services are most relevant to your customers
Your customers don’t want to be bombarded with hundreds of product/service suggestions. They’ve already bought something from you or are interested in doing so - don’t jeopardise that relationship by making irrelevant suggestions.
Help them achieve more success by recommending other products/services that may be of interest to them. These could be products and services that:
- Relate to what they’ve already bought
- Are what other customers with similar profiles have bought
- Can resolve some of their other pain points (that you should already know about)
2. Know which products/services are the most popular
Pair what you know about your customers’ interests and purchasing behaviours with your most popular products/services. This can help you maximise your up and cross-selling techniques.
The fact that a product or service is so popular among other customers of a similar profile will entice your customer. They’ll want to see why that product/service is so popular.
3. Be equipped to prove the value of the product/service
Customers will want to see how and why a product/service will add value to their business before they commit to purchasing something they’ve been up or cross-sold. So, make sure you can demonstrate its value.
You could use items like:
- Client testimonials
- Customer spotlights
- Customer reviews and ratings
- Case studies
A mixture of written and video content on how the product/service has benefitted another company similar to your customers can help them make a decision on their own.
Industry-specific ERP software can help
An ERP system can centralise essential business data which helps facilitate and accelerate decision making. An industry-specific solution can cater to the unique challenges businesses like yours experience in the equipment rental space.
For example, access to standardised templates and billing models will help you make quick quote estimates and proposals. Now you can quickly handle your customer’s dealings and close that deal.
Here are some other features that can help:
- Integrations with other key business software, such as a CRM system. This can help you further personalise your up and cross-selling suggestions. Modern CRMs like Dynamics 365 Customer Engagement can even make AI-driven suggestions and smartly adjust recommendations based on the customer profile
- Up-to-date inventory management. This will help your sales team see which equipment is available at specific times and communicate that to your customers. This will also improve customer experience
- Easy access to rental contracts. This will simplify contract management and improve customer experience as pricing, commissions and other item master data is combined on a single file
- Simplified asset utilisation so you can easily see equipment availability, maintenance schedules and custom. For example, you can see how many are rented out, being repaired and available to rent on any given day - which will make it easier to identify the right up and cross-selling opportunities
- Customers can access your complete catalogue - digitally. From equipment rental to parts for sale, allow your customers to easily search and browse your digital catalogue. This can boost customer satisfaction and experience as they can self-service (and give more time back to your internal teams)
If you want to increase revenue and profit margins, it’s time to innovate your business
Increasing numbers of companies are seeing the value in renting equipment rather than buying it outright. If you’re in the equipment rental space, that means increased pressure placed on prices, profit margins and the quality of customer experience.
Knowing your customer preferences and keeping up with the market will help you stay competitive. But as you likely already know, innovating your business model isn’t that simple. Unlike new product development, business models are typically multi-dimensional and more challenging to break down, analyse and replicate.
In our guide, we cover how equipment rental businesses can successfully innovate. Discover the trends you should know about and tips on identifying new opportunities.
Download the guide below to get started on your journey.