White Space Analysis
White space is the potential area to target where businesses essentially find the gap between the existing services & products and take advantage, to scale its revenue and market share. It is the process of going through the company’s data and exploring opportunities for new generating new sales opportunities within existing accounts.
White space analysis gives us the new outlook to look so that business can uncover opportunities that are not obvious, it can help in identifying new opportunities in the market which are not yet explored by competitors. The white space analysis process can be used to identify the completely new market or within the existing accounts which businesses have, which leads to new growth opportunities by defining potential gaps. White space can be categorized as Internally focused or externally focused.
Internally and externally focused white space
An Internally focused market is the process of introspecting into the existing accounts and customers which businesses have and look for the potential areas for identifying new sales opportunities as per the company’s strength and capabilities. This type of whitespace analysis helps businesses in uncovering the cross-sell and upsell opportunities in the existing accounts where businesses can revisit and create new use cases. The externally focused market is the process of identifying the gaps in the market, products or services in your market segment by determining whether any segment is under-served or untouched by other players in the market. Externally focused white space analysis aims at the goal to find the gaps in the market which represent opportunities for your business.
Cost of acquisition and cost of retention
Generating the revenue from the internal focused white space analysis is sort of easy, as chasing the new business is always exciting but it takes a lot of effort and cost to attract new customers than to retain the existing customer.
Since the existing customer is already doing business with your organization and has already seen some value and results which they are getting in doing business with your firm, that’s why existing customers are not only easy to convert and also doesn’t require you to spend any money in reaching to them.
Cross-sell and upsell strategies
Cross-sell is a strategy where selling the product and services business tries to convince the customers to buy additional offerings that will complement the product/services which they are purchasing.
Let me explain the concept of cross-sell with a real-life example, you head out to the market to buy some stuff it can be related to anything like electronics, automobile, etc. e.g. let’s take laptops. You head to the market to buy laptops then sales representative talks you to buy other additional offerings which complement laptops like a mouse, keyboard, printer, etc. by doing that he is trying to cross-sell his product, the same strategy can also be applied in the B2B segment where your business try to cross-sell additional offerings which the firm has to their existing or new customers.
Upselling is the practice where one convinces their end customers to buy higher-end products/services by showcasing that higher-end versions of the products/services will be better for the end customers to achieve their targets and goals.
Let’s take the same example of buying laptops to understand this concept with a real-life example, you head out to buy a laptop and you have a certain budget & laptop model in mind, but sales representative talks you out to buy higher-end/version of the laptop, by doing that he is trying to upsell his product by offering you the higher version of the product against your base requirement.
Get Singhshubham’s stories in your inbox
Join Medium for free to get updates from this writer.
The same strategy can be applied in the business scenario as well where almost all the business has different versions of their product with additional offerings in each upper-end version of the product, In the base product they keep their offerings to minimal but as they proceed with their premium version they offer more features and hence charge more for the premium version of the product.
How white space analysis can help the business?
- White space analysis can help you to identify the right opportunities to go after
- Helps businesses to explore the unmet needs of their existing customers and the introduction of new products/services to their portfolio or addition of new value proposition to the existing product/service.
- Once all the data is consolidated it will help to make the informed decision for approaching new opportunities.
- Helps to look at all the accounts from the holistic view or brings all the account under one umbrella to get the holistic view of the organization to cater to the grey areas if exists.
The business should understand their customers better to better position their cross-sell and upsell sales strategies. Below are some ways via which businesses can identify their white spaces:
- Consolidate all your accounts and drill down over various attributes
- Prioritize the accounts for sales strategies
- Identify use cases how business can sell more to their existing customers
Consolidate all your accounts and drill down over various attributes
Bring the data from various sources i.e. ERP, CRM, and databases, etc. like SAP, Salesforce and consolidate all the data. Clean the data, standardize it and dedupe the data and make clean master data using AI/ML algorithms. Once you will get the clean master data, categorize it based on sales opportunities, accounts, Industry, Product, period, etc. to get the understanding of the Internal landscape.
Prioritize the accounts for sales strategies
With the help of a clean master, data businesses can prioritize the accounts which they expect will give them higher revenue-generating options. Since businesses don’t want to chase all the accounts and end up with no or minimal returns. So, prioritizing the accounts help them to target the best customers. Once the target customers are identified businesses can offer them other product offerings/suggestions which your customer can use for gaining more success.
Identify use cases how business can sell more to their current customers
The business should find the gap that customers are currently receiving from your firm and what other products/services offering you have to offer which must be aligned with customer needs and requirements. Listen to the goals and targets of customers like “I want to do X”, “I wish I could do Y”, or “after this project, we are aiming to achieve this”. Then analyze the goals and targets of customers to determine which product offering from your firm can help your customers.
White space analysis is not only limited to cross-selling and upselling it can be used in other business areas as well as marketing, new product innovation, forming sales strategies, optimizing the company operations, etc.
References:
https://innovationmanagement.se/2013/06/13/white-space-mapping-seeing-the-future-beyond-the-core/
https://www.duedil.com/blogs/white-space-analysis-with-duedil
https://www.demandfarm.com/white-space-analysis/
