Anyone who’s left an end-of-semester essay until the night before it’s due has faced the horror of white space. The cursor blinking at the top of that empty page inspires sweaty palms, a dry throat, and unstoppable writer’s block.
White space in business, however, doesn’t have to be quite so nerve-wracking.
When used correctly, white spaces provide opportunities for companies to revamp their products and services. White space allows companies to increase the volume and velocity of their sales while further building their customer relationships.
In this piece, we’ll take you through the benefits and steps of analyzing white space so that you can leverage this valuable technique to improve your business.
What is white space analysis?
White space analysis is the process companies use to evaluate their existing products, services, and markets to address unmet customer needs. The “white space” is the opportunity itself—the area where a business can innovate, expand, upsell, and cross-sell its products and services. You can think of white space as a place of unfilled potential—a blank slate or canvas that is waiting to be colored in with unarticulated customer needs and business opportunities.
Performing a white space analysis is a critical step in discovering your company’s weak spots. When you’re ready to scale your business, white space analysis reveals your most worthwhile growth opportunities. It’s all about filling in the gaps.
Benefits of white space analysis
- Increased opportunities for upselling and cross-selling
- Expanded customer base
- New opportunities for innovation
- Improved customer relations and retention
- Refined sales approach and strategy
Increased opportunities for upselling and cross-selling
It’s a good idea to start your analysis with your existing customer base. After all, you already have all that data at your fingertips. More importantly, it costs more than five times as much to acquire a new customer as it does to blow the dust off your current customer list.
On average, 50 percent of existing customers are more likely to purchase again and to spend 31 percent more when they do so. It makes a lot more sense (and cents) to seek out opportunities to upsell and cross-sell to your current customers. Let’s take a closer look at what that means.
Upselling is a sales technique where reps pitch additional products or premium upgrades to service. While this means a more profitable sale for the company, it can also result in a more enjoyable or user-friendly experience of the product or service for the customer. If Simone is investing in a new chest freezer to stock up during the semi-annual ice cream sale and she receives an offer for an additional warranty, that’s a win-win situation.
Similarly, cross-selling is a white space opportunity for the customer to make an additional purchase. The difference is that the add-on is a complementary item or service that fulfills a separate need than the original. For example, if Angelo has just added a jar of peanut butter to his online shopping cart, he might receive a suggestion to also add a jar of Irish strawberry jam and some honey wheat bread. Now he’ll be able to make a delicious PB&J sandwich.
Making those suggestions at key moments doesn’t just move customers through your pipeline—it makes their experience better. Every successful upsell or cross sell is a fantastic elimination of white space.
Expanded customer base
You can always uncover new sales opportunities by exploring how to expand your customer base. The easiest way to do this is by targeting a different part of your audience. Let’s say your healthcare technology company has primarily served the northeastern United States. Expanding might mean exploring ways to branch out to other regions of the country.
New opportunities for innovation
White spaces are also opportunities for product or service innovations. This is where strong knowledge of your competition and your customer preferences comes in handy. Wherever you spot needs that are going unmet and pain points that are not being addressed, pay attention. These are areas for innovation in your existing products, services, and features.
Improved customer relations and retention
Creating a dialogue with your customers about how they use your product is a great way to show how much you care about their experience. You want to know how you can serve them better, not how you can squeeze more money out of them. Not only does this increase trust between your sales team and your customers, it also gives you valuable insights to make more informed decisions about product development.
All in all, you want to create a cycle of happier customers who are easier to retain because you have a clearer picture of how you’re serving them.
Refined sales approach and strategy
While no two customer journeys are exactly alike, you can use educated guesses to find out which tactics are likely to be effective with certain audience segments. If your company sells B2B, then you’re more likely to use a consultative selling approach. A customer-facing retail business is more likely to employ a soft sell. Armed with the insight from your white space analysis, you might encourage your reps to take a new approach or employ different techniques to close the deal.
In addition to shifting sales approaches, your analysis can offer guidance on refining your sales strategy and adapting your team goals. Your sales managers might direct their teams to change up product positioning or perhaps research new data about competitors. Let these insights drive necessary changes to your strategy and you’ll enjoy increased sales and ROI.
How does white space analysis work?
Now that we’ve looked at the benefits of white space analysis, let’s break down the steps. Remember, you don’t have to do it all by hand. Plenty of sales software in 2022 has the capacity to generate insightful reports and tools that will assist your team.
Step 1: Identify your offerings
Self-examination is not just important for humans to grow as individuals—it’s also important for companies. Take a look at the products you sell, who buys them, and what those customers have already purchased. Then, break your answers down into specifics like:
- Opportunity type
- Account type
- Time period
- Product family
Your answers to these questions give you powerful insights into your customers’ pain points and whether or not those points are being addressed.
Step 2: Locate buying centers in existing accounts
When you have a large customer base, it’s useful to do a deep dive into accounts with strong potential for future investment. Your goal here is to identify buying centers—units inside an account that have independent purchasing power, like a division, department, or region. Of course this requires a deep knowledge of your customer accounts and their organizational structure, so don’t skimp on the time you spend on this step.
Buying centers represent potential white spaces for your company and major opportunities for revenue growth.
Step 3: Map white space opportunities
Now that you’ve gotten reacquainted with your offerings and done a deep dive into your accounts and buying centers, it’s time to map your white space opportunities. There are three main types of mapping: internally focused, externally focused, and future-focused.
Internally focused white space mapping is an inward-looking tool to help you identify your company’s strengths, abilities, potential opportunities, and competitive threats. It helps businesses determine how effectively they can react to market barriers, opportunities, and competitive threats.
Externally focused white space mapping, on the other hand, is an outwardly-directed tool. It examines existing markets to identify products and services and whether they are failing to meet needs. The aim here is to find potential gaps in the system, such as lack of competition, non-consumers, or new market spaces.
Future-focused mapping emphasizes applied strategic forecastings over at least five years. It’s useful to think of future mapping as a super-powered externally-focused map. Future maps rely on the same sort of insights, they just project those insights on longer time periods.
Step 4: Analyze your findings
The next big question is what to actually do with all the sales data you’ve compiled. Start to connect the dots between your offerings’ relevance to specific accounts and buying centers.
It’s also a good idea to perform a competitor analysis at the same time. You want to make sure your most relevant accounts stay happy where they are and that means keeping the competition on their toes. Where is your offering exceeding your competitors by meeting customer needs better or faster? Where are your offerings falling short and need improvement? Your analysis will show you the white space accounts where you can target customers with better solutions.
Some companies use templates to simplify the visualization of this complex analysis. Typically, these templates are in a table format that set up customer accounts and products/services on an X–Y plane. They can be color-coded to show account health or level of engagement. White space analysis then becomes literal as white spots pop up on your colored map and highlight new opportunities.
Step 5: Identify and act on opportunities
The final step is to leverage your analysis into action. There’s no one right way to implement your findings, but depending on your results you might:
- Make direct contact with potential customers
- Target existing or new audience segments with marketing material
- Design a product/service that addresses a newly revealed pain point
No matter how you approach the opportunity, your goal is the same: fill in the white space with success.
How to identify white space opportunities in your business
White space analysis is a big undertaking. Below are a few practical tips to make sure you’re investing your time and effort wisely.
Tip 1: Survey your existing customers
Talking to your current customers is one of the best ways to learn how you can improve your offerings. Your customers know what you’re not offering because they want it and don’t have it. Heed their advice and you’ll have a stronger product, a healthier rep-to-customer relationship, and an overall improved sales strategy.
Tip 2: Innovate on your current offerings
After looking at customer feedback, it’s common to come away with lots of innovation ideas. Consider your existing line-up of products and services. Is there anything missing that makes sense to add? Perhaps your digital marketing agency is lacking in integrated online marketing strategies? That’s a clear white space opportunity for innovation.
Tip 3: Target a new audience segment
If you’re coming up dry on ways to innovate your current offers, then you might consider innovating your audience. Finding a slightly different angle on your audience can yield big results. Take a look at the demographics of your current customer base and see where you can make some shifts.
Tip 4: Reexamine your unique selling point (USP)
If it’s been awhile since you really thought about what makes your product, service, or business different from anyone else out there, it’s time to revisit. By giving your mission statement a closer look, you can solidify your branding strategy, uncover new prospects, and strengthen your business plan.
Accelerate revenue with a clear-cut white space analysis
White space analysis is only as comprehensive as the data you use to guide it. After all, it’s nearly impossible to segment tens of thousands of customers by hand. That’s why smart businesses take advantage of CRM (customer relationship management) software. With a wealth of sales tools at your fingertips, you can sift through customer data, sales performance metrics, and competitor information to define cutting-edge strategies.
With Zendesk Sell, you have full visibility into your sales funnel and pipeline. It’s easy to review your existing accounts, communicate with your customer base, and find the gaps in your offerings—so you can fill them.
Don’t miss out on revenue opportunities because you haven’t identified them yet. Sign up for a free trial of Zendesk Sell today and discover where white spaces are hiding in your business.