What Works (and Doesn’t Work) for Upselling and Cross-

“Would you like fries with that?”

Upselling and cross-selling can be extremely effective ways to increase revenue and raise the value of a single customer. The key to doing either one successfully is demonstrating to the customer that they will benefit from the purchase, convincing them that the value they will get is worth the additional cost.

That said, there are some approaches to upselling and cross-selling that can be successful, and others that are destined to flop. Let’s explore what works and what doesn’t work, so you can develop a solid upselling or cross-selling strategy.

What’s the Difference?

First of all, let’s be clear about the difference between upselling and cross-selling, because the term “upsell” is often used as a blanket term for both, as well as add-ons, bundled products, and even offering bulk discounts – so confusion here is common!

Upselling really refers to offering the customer a higher-priced version of the product they are already looking at. This higher-end product will generally be comparable to the one they are considering, constituting an “upgrade” with additional features. (Think of some online retailers’ “similar products” or “customers also looked at” suggestions, which commonly show multiple types of the searched product at various price points.)

Cross-selling is inviting the customer to purchase related or complementary items associated with their primary purchase. For example, if the primary item being sold is a printer, you might suggest toner cartridges, paper, labels, or even a printer stand. (Think of the “you might also like” or the “frequently bought together” lines that appear on Amazon products, which might suggest other titles by the same author, a case for the camera you’re buying, or refills/replacements for consumable supplies.)

What Works in Upselling?

To successfully upsell, there are a few things to keep in mind:

1. The suggested product must have comparable features. You can’t upsell someone to a product that doesn’t have everything they want. They’re already looking at a specific product, so anything at a higher price point needs to have all of same features AND MORE in order to justify the upsell.
2. The smaller the price difference, the more likely the customer will agree. If the price differential between the original product and the higher-end product is within a close range, the customer will see less risk in switching.
3. The customer must see a benefit in the added features. If you’re trying to upsell someone to an offering that costs more, but can’t tell them how they would benefit from the switch, they won’t! Have a good value proposition or FAB prepared that clearly spells out what positive effect the upgrade will have for them.
4. Upselling works best on existing customers. It’s easier to upsell a customer who has purchased from you before than it is to upsell a new prospect. An established relationship with an existing margin of trust is helpful.
5. Customers don’t want to have too many options. If you give them a list of suggested upgrades, they’ll get overwhelmed by the choices and revert to their original selection. Just offer one good alternative that meets all of their needs.

What Works in Cross-Sellling?

Cross-selling is a more challenging technique than upselling, but can still be a successful way to sell more if you do it thoughtfully. Here’s what to remember:

1. Cross-sold products should be obviously and directly related to the primary product. If the customer can’t see any relation between the offering, they will merely become annoyed. Bundle cross-sold products in a natural way – suggest accessories or supplies, or products that will work together.
2. Cross-selling works best when suggested products cost less than 50% of the original purchase. If the secondary product costs more than half the cost of the primary product, customers are more likely to turn it down.
3. Customers are most likely to agree to small cross-sales on small purchases. When the primary product and cross-sold product are minor expenses, customers don’t feel at risk, and are more likely to buy both. Larger purchases tend to make customers reluctant to spend more…
4. … unless the cross-sells are very small compared to the original product. A customer who just bought a car may agree to added products like floor mats, rust-proofing or fabric protectant because the price tags for such add-ons seem so negligible compared to what they already forked over for the car.

In general, upselling is a more frequently successful technique than cross-selling, but a well-considered cross-sell is often more profitable for the seller. Keep these guidelines in mind, and consider where you might be able to interest a customer in spending just a little more!

Baker Communications offers leading edge sales training solutions for sales makers and sales managers that will help you address the goals and achieve the outcomes addressed in this article. For more information about how your organization can achieve immediate and lasting behavior change that will uncover new opportunities, drive revenue, and boost your bottom line, click here.