Cross-selling and upselling is one of the marketing strategies used to increase sales. Its essence is to persuade a customer to buy an expensive product or service and increase the average check. In a nutshell, you make the customer an alternative offer with a higher price.
A logical question arises: why will the customer want to pay at all? Of course, this is not a single question from marketers:
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As nobody will refuse a chance to save money, this is one of the main priorities for some people. It’s all about the logic of actions, so to implement successful cross-selling and upselling in an online store or other types of business, you should support the offer with the following arguments:
- The opportunity to buy a similar product, but with better quality or functionality;
- Exchange a previously purchased item for a newer one.
No way should you be pushy. Offer customers an expensive product only when they need it. Buyers should understand you are trying to help them, but not just want to earn.
Real Examples of Upselling
The key idea of a successful commercial offer is nobody needs a product to have it. We rather see it as a tool to solve a particular problem. Thus, a better product allows dealing with the situation efficiently.
For example, how customers choose goods in an official Apple store illustrates such an approach well. I have chosen Apple’s model since probably all our readers know this company. And I doubt there are many enterprises in the world would be proficient in marketing than this one.
In the screenshot above, you can see this company offers additional advanced options for all main components that influence computer speed. For example, if you want faster work, choose an SSD instead of a hard disk. Need better performance and reserve capacity? Pay attention to the processor with an increased clock rate and the ability to double RAM. And it is worth noting this strategy shows really good results, as in the countries where customization is supported, such versions of Mac are the most popular ones.
It is also possible to put expensive additional products into a separate block named “Customers also loved” like in this screenshot:
An up-sell block will be the most effective if a customer associates this offer with a recommendation of experts or other users. So use such headers as:
- Find out more.
- Top seller.
- Interesting offers.
The most suitable places for additional recommendation blocks are a product card, a sidebar, and shopping cart pages. And the latter option is unobvious, as a buyer has already made a purchase, right?
The offer of an advanced warranty is highlighted in orange. You can buy it right away when you make a purchase paying an additional $30.
Or you can at least make it look like a simple switch, as in the example below:
It is worth noting that sometimes even big online stores extensively cross-sell but almost forget about upselling. Whereas actually, these strategies don’t exclude each other, and you can effectively combine them.
The Difference Between Upsell and Cross sell
The difference between the upsell technique, and the already mentioned cross-sell a seller isn’t concerned with selling additional goods but rather aims to sell a product that a customer was initially interested in. The point is this product is just top-class. Here we can provide an interesting and lucid example: basic and premium modifications of the same car model.
Upsell is usually not about satisfying a need but about revealing opportunities for a better product variation. In other words, a customer who buys an offroader may not need leather seats with a DVD player and other entertainments, but these additional functions can make family trips comfortable. Hence, they turn into a value worth paying.
The second example is clothes. Imagine yourself in the shoes of a customer and think about the differences between a luxury brand shirt and something sewed by an ordinary, unknown producer. Quality isn’t always a solid reason, so showing the differences between good and the best in terms of comfort is much easier.
Explain to the customer a luxury brand uses materials that are pleasant to wear and have exceptional durability. In addition to this, the producer has earned its reputation exactly because the quality and convenience of its products are much more important than the price in the long run.
Upsell, along with cross-selling, is one of the ways to increase an average check. And it is worth noting that they aren’t mutually exclusive, so you can successfully combine both. Using the upsell technique in an online store, you get two advantages important for any business:
- Average check increase based on existing customers. All studies carried out by marketing and analytics companies prove some general conclusions: the probability a new customer will purchase even if the one is interested in 5-20%. Whereas the chance to sell something to an existing customer is approximately 60-70%. The difference in terms of profit can be equally impressive.
- Improved customer loyalty. If we are talking not about comparatively uncommon impulse purchases, people buy goods and services to solve a particular problem. They often have difficulties finding a good way out of the situation, and timely help allows them to do and gives great benefits. In this case, the customer will appreciate the assistance. And people prefer to come back to those who they like.
Income from additional purchases stands out with its nonlinear character. So if 10% of all customers decide to buy expensive products, this doesn’t necessarily mean profit will also increase by only 10%. Depending on the amount spent, this can be even 30%. Thus the game is definitely worth the candle.
In many ways, upselling is a tool to influence customers on a psychological level. At first, you attract people with a reasonable offer, and after that, shortly before they decide, show them something slightly better.
At the same time, you must remember that most modern buyers understand the difference between value as a price and value as usefulness. So, if you want to increase the average check, extra benefits, which customers will get, should be useful to them the additional price they will have to cover.
All this boils down to the fact that it is helping online store customers get just what they need. You don’t only make them satisfied, but also increase income.