Consulting enters the era of the cross-sell

From the very earliest stages of the pandemic, we started to see evidence of a “flight to incumbency” within the consulting market: Clients were becoming considerably less willing to work with suppliers they did not have a pre-existing relationship with. This wasn’t a particularly unexpected development—similar changes to client behaviour took place in the wake of previous crises, after all. But this time around, it proved to be more than just a temporary, knee-jerk reaction. It’s now been over a year since countries started going into lockdown, and clients are still telling us that they are highly reluctant to buy consulting services from any provider that doesn’t have a strong track record of creating value for their organisation.

In response to this shift in client behaviour, consultants have had to develop a new-found appreciation for the art of the cross-sell. When breaking into new accounts becomes harder, it’s only natural that firms should seek to compensate by finding ways to extract more revenue from their existing client relationships. In practical terms, this means looking more aggressively for opportunities to sell follow-on services, and using successful projects as a springboard to move into new parts of the client’s organisation.

But the pandemic hasn’t just forced firms to rely more heavily on cross-selling; it’s also, in many ways, made the practice a lot easier than it used to be. One of the other big behavioural shifts that’s taken place over the past year has been that C-suite stakeholders are increasing their level of involvement in purchasing decisions that would previously have been considered below their pay grade. Senior leadership teams seem to have decided that it will be easier to steer their organisations through this current period of disruption if they have better visibility of the projects that are going on underneath them. That creates a lot of opportunities for the ambitious consulting firm; when you have ready access to senior stakeholders, you can leverage those connections to expand your footprint within the account.

“There are a lot of accounts who we’ve been working with for years, but where we’ve struggled to break out of the technology function,” one firm told us recently. “But since the pandemic started, we’re no longer just dealing with IT department heads; COOs and CFOs have become much more involved in that kind of technology work. And if we do a good job and impress those stakeholders, it’s a lot easier for us to make the case that they should also be considering us for other types of work elsewhere in the organisation.”

Our recommendation is that consultants grasp those types of opportunities with both hands. Sometimes there’s a fear among consultants that leaning too hard into cross-selling might come off as unnecessarily pushy—that it risks overly commercialising client relationships. But the data suggests that these fears are, for the most part, misplaced. In a survey we conducted last year, we found that only 11% of clients have a generally negative attitude towards firms trying to cross-sell to them. The majority said that they had no issue with the practice, provided that certain conditions were met.

What are those conditions, exactly? First, and perhaps most obviously, the firm trying to cross-sell must have met or exceeded client expectations on the original piece of work they were brought in to do. But clients also said it was important that the firm trying to cross-sell had a genuine and deep understanding of their challenges and their needs. The approach of sitting down with a client at the end of an engagement and saying, “Look at all these other services we sell—is there anything you might want to buy?” doesn’t work. Much more effective is being able to say something like, “While we were delivering this project, we noticed this other issue that your business is having to deal with—and here’s why we think we could help you with it.”

Cross-selling might not be a new concept for professional services firms, but it has become both more important and easier to do since the onset of the pandemic; if you don’t want to leave money on the table, it’s probably time to start making sure that your consultants and your account managers know how to do it sensitively and intelligently.