Would you like to add coke with the pizza?
A simple strategy used by Dominos!
Research shows that over 30% of businesses earn greater revenue through upsell and cross-sell.
As shoppers, we get intrigued by the standard sale tactics. Companies produce more products, as they want us to buy more.
However, the major issue arises when companies spam our emails with unnecessary product uploads, forcing us to buy products (through pop-ups and notifications) that we don’t need.
Though upselling and cross-selling has been a great strategy for several e-commerce sites, Amazon is one of the biggest examples of this marketing venture.
In 2006, Amazon reported it to help them to gross over 35% of their revenue. And, that’s huge over a decade ago.
Product recommendations from personal referrals or customer referrals can significantly increase the ROI by up to 30% to 35%.
So, there is no reason to back down on using upselling and cross-selling for your business growth.
What is Upselling and Cross-Selling Strategies?
Upsell is selling a higher level of service.
An example of an upsell is Gym membership. You can enroll for a one-month gym subscription at $500, and if you pay $300 more, you get a personal trainer as well: the personal trainer is the upsell.
Cross-sell is selling a different service.
The example here is, when you take a gym membership, the managers offer you other packages like spa or yoga membership: Yoga and spa are cross-sell.
One of the most common examples you can see on the e-commerce website. Where you buy one pair of jeans and the site recommends you with “customers also purchase (any relevant clothing piece),” this quoted line is the upsell.
And, for cross-sell, you can take a similar example of an e-commerce website, where you purchase a mobile phone, you are given options of additional accessories like tempered glass or back cover. This is cross-selling.
There are several examples you see in your day to day lives. Upsell and cross-sell are important practices for companies to gain more revenue.
Let’s explore the top 5 strategies with NextBee’s Robust Engagement Modules for upsell and cross-sell.
Understand which Strategies will Generate Result
Don’t barrage your customers with unnecessary product suggestions.
They know that they are your customers, and they have already made a purchase, so bombarding them with offers right after they have purchased can be a bit more.
Upsell and cross-sell offer limited opportunities, so you have to be strategic with the techniques to get results.
Without any doubt, upsell has better prospects than cross-sell. Buyers don’t like to get confused; if they are up for a product purchase, they will buy that only, so tossing in relevant products can be profitable.
However, sometimes upselling isn’t the way. For example, if you are selling a hair straightener, you can go for a cross-selling strategy like adding a hairdryer to the suggestion.
These strategies can help the buyers be content with the suggestions, hence a bright chance of getting the new purchases done.
Offer Products that Make Sense
Have you ever waited in a multiplex to watch a Sci-Fi movie, but reach the booking hall you are recommended for comedy movies? Frustrating, isn’t it?
Likewise, suggesting your customers with completely out of the field offer will make them feel agitated, which can also hamper your relations with them.
Upsell and cross-sell strategies have to fit, based on their purchase.
Once you understand your customers’ needs, you can easily determine the products and services that could entice them.
For example, for an IT company that has enrolled for networking solutions, adding them a server monitoring package or data backup can help.
Be Constraint of Time
If you want to get the customers back, you need to provide them with the right time value.
Time should be handy. Thus, upselling the customers with relevant service at the right time, especially when they are in need of it.
For example, don’t offer digital marketing services to a company that has its own in-house team. It will be a waste of time on both ends.
If your customers feel you are wasting their time with unnecessary products and services, they’ll bolt in no time, which will impact your customer churn rate. You don’t want that to happen.
Be up-front with your upsell and cross-sell by looking at their purchase graphs through NextBee’s engagement module. You’ll know what they are looking for, and what offer you should provide the next.
Customer Loyalty Rewards
Upsell and cross-sell is a great revenue strategy, but does this mean your job is over? No, it isn’t! There is more to it.
With this strategy, you have asked your customers to spend more money, and have successfully convinced them. So, this calls for a celebration. But. Not only at your end, at your customer’s end too.
If a customer takes an additional step to purchase more than they came for, you need to make an extra effort to reward them for their loyalty.
You can offer them with gifts or discount codes for their next purchase.
With customer loyalty rewards, you can see a smooth increase in the revenue through upselling and cross-selling. Putting them as a secondary purchase will help in customer retention and increased ROI.
Consider the Customer’s Pricing Preferences
NextBee offers you with a dashboard that displays customer purchase metrics. This will help you to understand the price sensitivity.
You cannot bombard your customers with products above $1000 if their purchase history lies between $100 to $500.
Building an upselling or cross-selling product strategy between these price ranges will help your customers to take a chance and purchase the recommended product.
For example, if your customer is looking for a book on machine learning, you can suggest books for artificial intelligence as an upsell strategy.
Products that match the bundle will seek in the interest of the customers. Thus, recommend them with products that fall under their budget.
Lofty sales will let you lose your valuable customers. And these strategies also apply to your potential customers. In order to acquire new customers, you have to look out for reasonable upsell and cross-sell.
For potential customers and valuable customers, you have to be a bit more careful. Consider the following suggestions:
- Don’t suggest upsells or cross-sell before a customer selects a product.
- Don’t barge the customers with extra cross-sell and upsell services.
- Don’t upload the unnecessary inventory with upsell and cross-sell.
- Don’t cross-sell or upsell a new product.
On the whole, your upsell and cross-sell strategies should help the customers in making a quick and sound decision.