Cross-Selling and Upselling: 10 Tips for Success
Some may say sales is an art, others that it is an innate talent. But with the right tools and knowledge, anyone can become a sales authority.
If attracting and acquiring a new customer takes a bit of time and investment, cross-selling and upselling approaches can bump up your sales goals with just a few tricks.
Cross-selling and upselling encourage customer loyalty. It just might be the unexplored shortcuts to increase your revenue and grow your business.
Results can be achieved faster when you have a full-time salesforce dedicated to prospecting customers, of course. But when you’re just starting your business or if you’re a one-person company, then focusing on cross-selling and upselling are your sure bets.
Not only you’ll get to leverage on potential customers to buy more on something they have already decided on, but cross-selling and upselling can easily be automated with the help of MightyForms combined with other eCommerce and payment platforms.
In this article, we’ll unveil the ten tips for cross-selling and upselling success. From five tips for setting it up to another five for automating it, so you can squeeze every revenue possibility from a sales opportunity.
What are Cross-Selling and Upselling
When you’re trying to grow your business, you might be so fixed on a one-track mind to acquire new customers for your products or services, that you might miss out on some obvious prospects.
The golden rule of business that it costs five times more to acquire a new customer than retaining an existing one should never be ignored. In fact, when you also consider that the success rate of selling to an existing customer is 60-70% while the chances of selling to a new customer are about 5-20%, you start to realize something.
Sales efforts should never be channeled solely on the acquisition of new customers nor into a single purchase. Just like adding baking powder to a cake recipe, cross-selling and upselling can double your profit.
Even if you don’t know these sales techniques by name, I’m sure you have already made a purchase or perhaps, made a sales pitch instinctively by cross-selling or upselling something. But let’s lay out their definitions:
Cross-selling is the practice of selling an additional product or service to an existing customer. Usually, the additional purchase is related to the primary one.
The classic example of cross-selling is any combo order at your favorite fast-food restaurant. The customer is already there buying a burger, for example, so he or she might as well want fries with that, indeed. And a soda. Maybe an apple pie too. And just like that, a customer bought more items than previously intended.
If someone is buying car insurance, for example, you can also offer house insurance along with your sales pitch. Why not offer life insurance too while you’re at it? The client can be persuaded to see the benefit of dealing with only one insurance company for all three contracts.
Upselling is the sales technique of encouraging a customer to purchase a premium option of the intended product. Unlike cross-selling, which encourages a complementary purchase, upselling is all about offering an upgrade or add-ons to the primary purchase.
A well-known upselling purchase that we’ve all been tempted to buy is a flight ticket upgrade. The customer has already decided on the flight, so why not offer an upgrade from coach to business class? For a “few more” dollars, get bumped up to the first class and airport lounge access.
Subscription services are another example of upselling sales. Encourage a customer from a basic plan to move up to a PRO plan with more benefits and features. In fact, you might be simply letting your customer know that there is a better option from what they have previously considered.
Why You Should Cross-sell and Upsell
Cross-selling and upselling techniques help businesses maximize the revenue of each purchase. Different than convincing a potential customer to get to try your business, these approaches stretch buyer intent in order to increase profit margin.
It is actually a wasted opportunity not to cross-sell or upsell since the customer was already attracted to the buyer’s journey. It just widens the sales funnel while shortening its cycle, resulting in a higher yield per buyer.
As a seller, you can employ either cross-selling or upselling at first. Most well-established companies, however, combine both techniques at the same time (for an additional price, customers can stack extra patties and bacon in their combo burger deal, for instance), or offer one followed by the other later, like offering extended warranty on a more expensive iPhone version purchase, for example.
Generally, upselling is easier than cross-selling since you’re just offering a better version of one product or service, instead of trying to sell additional items. But keep in mind there’s no rule.
As long as it makes sense within your business model and that actual value is added to your product or service, cross-selling and upselling can strengthen the customer relationships, greatly impacting customer retention and revenue.
The Top 5 Cross-Selling and Upselling Tips
It’s easy to get carried away trying to cross-sell and upsell right and left. But if it’s not done right, it might actually get the opposite effect. Things can go sour fast and you might put the original or primary purchase at risk. Even worse, build a bad rep for your brand.
Some businesses might consider cross-selling and upselling so risky, that they prefer not to take chances endangering the closing of a sales. But honestly, when done effectively, the gains outweigh the risks.
That’s why we’ll go over the best lessons from the pros. Let’s benchmark from sales best practices in order to master cross-selling and upselling techniques for good. Here are the top five cross-selling and upselling tips for success unveiled:
1. Know your business
The process starts from within. It might sound silly to tell you to examine your business first since you already know your own business well. But the idea here is to find out first, what cross-selling and upselling options you could offer related to your main product or service. Secondly, if it is viable financially, logistically, legally, etc.
If you’ll need a whole new operation protocol and staff to handle the additional items or to deliver the upgrade properly, then maybe cross-selling and upselling are not for you. Think of what else can you offer along with your product or service without implying extra cost for you, otherwise, it will defeat the purpose of incremental revenue.
Study your niche and find out what your competition is offering. Keep it simple so you can afford your cross-sell or upsell in the long run. A great example is how movie theaters make more money out of concessions than the actual movie ticket. A bucket of popcorn and a cup of soda are easy and cheap to maintain as a cross-sell and perfect complementary options for a movie.
2. Know your audience
The next step is to get acquainted with your audience’s needs and purchasing power. Find out their consumer behavior and demographics. Cross-selling and upselling should not be rocket science but they can’t be based on guesses either. You need the data to back up your offer.
If you’re using MightyForms already for your contact form or payment form, you get the form data analytics all mapped out for you. Not to mention you can easily export all collected customer information to any spreadsheet program like Google Sheets, Microsoft Excel, or Airtable (through Zapier) for further data management.
Going even more technical about it, you can even ask your customers directly what they think would enhance your product or service. You can create tailored surveys and questionnaires with MightyForms to probe customers using a Likert scale to find out how likely they would be willing to pay more for a premium offer, for instance.
3. Be ethical
Cross-selling and upselling are legitimate sales techniques and should never be perceived by your audience as a marketing gimmick only, or worse, a scam. Cross-selling for instance is very different from tie-in sales, where customers are required to pay for unrelated items with the desired one. We see this negative example a lot with phone or tv cable companies, where they push you to buy a combo plan with items you don’t need.
If you’re upselling, make sure your premium offer has discernible benefits in comparison with the primary offer. The idea is to provide a better option for those willing to pay more, but never downgrade your primary product or service on purpose just so you can charge more for an upgrade. It’s common to see this phishing scam during Black Friday sales when you’re led to believe you’re getting a discount deal but really just buying a downgraded version.
4. Know your timing
Cross-selling and upselling are more effective after the “attract stage” of the customer journey. If you’re still trying to convert your potential buyer, then cross-selling or upselling might overwhelm or confuse them. Imagine walking in a store for nails and a clerk starts to offer you a hammer while you’re still making up your mind about what type of nail you need.
You can always make your offer at the closing moment (or the checkout page of an eCommerce website for example) or sometime later after your customer has experienced – and trusted – your services. Upon customer feedback, you may pick up on an additional need or demand and that will be your queue to offer more items or an upgrade.
5. Know your pitch
The last tip is the most crucial one. When you approach your customer with a cross-sell or an upsell, it must be perceived as a service. The customer must feel valued and their business appreciated. That you are going above and beyond to enhance the customer experience. Whatever additional products or upgrades to a service must be pitched in a way you are acknowledging and meeting their needs and not that you’re trying to clear out your stock.
The best pitch is when your cross-selling or upselling deal is offered as a solution to a problem. An example would be to offer a cell phone case and a portable power bank to someone who’s buying a new mobile phone. Another approach is to sell an upgrade as a last-minute opportunity, like offering the more expensive ocean-view room that “just” became available during a hotel booking, for example. Or make your customer feel special by offering a discount on a premium plan on their birthday, for instance.
5 Ways to Automate Your Cross-selling and Upselling
The best part of cross-selling and upselling is that it doesn’t need extra work or additional investment to make it happen. You can automate your cross-selling and upselling triggers with MightyForms to ensure that you get the most of your sales while saving time and money by making technology do the heavy lifting here.
Here are five ways that you can automate your cross-selling and upselling efforts with MightyForms powerful features and functionalities:
1. eCommerce Integrations
Anything can be sold on the internet these days and eCommerce platforms make any home-based business look like a solid online business. You can create fully responsive forms with MightyForms and have them integrated and embedded into the best eCommerce platforms like BigCommerce and Magento 2 (Shopify to be added soon).
More than setting up your online store, you’ll get to collect customer’s contact information and feedback about the shopping experience with your business. Which you’ll need to make a personalized cross-selling or upgrade pitch during or after purchase.
2. Logic Rules
MightyForms enables you to build a smart form that will work as your screening department. With Logic Rules functionality, you can set up conditions to optimize the flow of customer intake.
Set up Logic Rules to automatically offer a related product when an item is selected in order to accomplish a cross-sell. Or condition your form to display the advantages of a premium subscription plan whenever the basic plan is selected as an upsell strategy.
The closing of a sale can be a very time-sensitive decision. Leave no room for hesitation by setting up automatic notifications with each form created with MightyForms.
A personalized success message can pop up soon after each submission, redirecting your customers to your pricing page, for instance, to show customers what’s included in your premium plan. Or you can offer the available cross-sell products automatically by email or SMS.
4. Payment Forms
If you’re just starting your business or you’re a service provider, then maybe a full-scale eCommerce setup is overkill. You can simplify your sales or orders by building payment forms powered by Stripe with MightyForms. Seamlessly integrate your payment form with your Stripe account and collect payment straight on the form.
In order to persuade your shoppers to accept your cross-sell or upsell options, you can easily enable coupons in your Stripe payment forms. And because MightyForms payment forms are fully customizable, you can make your cross-sell suggestions or upsell offers stand out in your forms to catch more attention and influence your customers’ decisions.
5. Sales Integrations
If you’re in the business of selling big and expensive things, like a house or a boat, then perhaps you might need an actual salesperson to make your cross-sell or upsell pitch. With MightyForms, you can automatically connect your quote request form to Pipedrive, the CRM platform for salespeople.
Waste no time getting an order submission or quote request into your sales pipeline so your team can work on it. Stay ahead of your competition by automating the sales process, from form submission to full closing.
Growing your business and increasing your revenue can happen faster when you leverage the sales potential of your existing customers. Cross-selling and upselling techniques can be applied and adapted to any business model to maximize results. Automation and integrations by MightyForms just connect the dots seamlessly so no sales opportunity is missed. Let us know how we can help you reach your sales goal!