Customer Growth: Why Sales and Expansion Aren’t the Same Thing

Everyone loves to talk about growth. Why? Because it means more money! Of course, growth represents a lot more than just more revenue or a “bigger” company. That’s why it’s important to recognize the difference between sales and expansions. So, what is the difference?

What’s the difference between sales and expansions?

In this context, sales is the initial sale, and expansion are the upsells and additional services you can sell to those very same customers to increase your revenue. This is a great way to promote growth because you’ve already got the customer through the door – you don’t need to spend more money and effort searching for new customers.

What’s the best way to handle expansions?

While sales and expansions aren’t the same thing, and that should be acknowledged and tracked, it usually best to allow your current sales team to handle expansions, rather than building a specialized team. This will allow them to build on the relationships they have already established with their customers offer expansions as a natural upgrade, rather than pushing the customer to start a whole new sales conversation with a stranger.

If they’re handled by the same team, why think of them as separate?

Why? Because they are important in their own right and you need to be intentional about your growth. Often, upsells and other methods of expansion are products and services you don’t offer as a stand-alone service, and the process for selling expansions to new and existing clients is very different from the initial sale. The initial sale is about forming that relationship and showing the customer your value.

Expansions are only effective when that value and relationship is established – they can’t be seen as the same thing. You should know what your sales teams are having success with and what’s a difficult sell so you can analyze whether it’s truly the right product for your customers. An expansion strategy can’t be based on the aggressive sales strategy you use for your initial sale. When done right, an expansion will be an offer that feels personalized to the customer and a no-brainer upgrade to ensure they get the results they need. When done wrong, they’ll feel like a sponge being squeezed for everything they’ve got.

Expansions are an upgrade

Expansions are a way to bring the customer up a level and offer an even better solution for them. When your sales team gets this right – and uses the relationship they’ve developed with their customers as a tool – increasing your revenue will feel easy.