If you belong to a brand that has created a network of customers and is seeking growth, then there are many strategies to apply. However, they want the ones that are most effective against all odds. Or should we say they should implement upselling and cross-selling in their marketing strategies?
In research on upselling and cross-selling, numerous global brands make more than 70% of their revenue by effectively implementing these two techniques.
The key lies in the “effective” implementation of upselling and cross-selling services and products.
So, if you are yet to get started with these or are doubtful whether they’ll work for your brand in the long run, you should read this one. Once done, you’ll be able to understand why upselling and cross-selling are essential and the more accessible means to implement them. But first things first.
What is cross-selling in marketing?
According to the book, cross-selling is a marketing strategy that makes potential consumers buy more relevant products than they originally intended.
It is important to note that cross-selling does not mean that your marketing team compels the buyer to make a purchase. The main idea is to pitch only those products or services to the customer that are relevant to the original and intended purchase. Let’s take a look at the examples below and understand it better.
Cross-selling marketing examples
You are in a superstore, and you’ve collected all the required items in your cart. Eventually, you move to the check-out counter and encounter a medium-sized rack. Now, you notice that the shelf is filled with things such as chocolates in a variety of sizes, along with a few more durable items. Although you didn’t want it initially, you’ll probably add at least one product from the wide range compared to your filled cart. As a result, the store cross-sold additional products without any hassle and the ones you wanted to buy.
On similar lines, say you ordered a fully loaded washing machine as per your current requirements from an e-commerce website. The product was delivered to your doorstep in no time, and the next day, the engineers from the manufacturing company visited your place for installation and demo of the product.
During the process, they might introduce you to some additional elements to extend your machine’s lifecycle, such as covers, stands, and even extensions for outlet pipes. As you buy any of these items, the company representatives cross-sell the products, increasing the company’s revenue.
Given that you’ve made it this far with us, let’s talk about another selling strategy, upselling.
What is upselling in marketing?
Upselling is also a marketing strategy that makes your end-user buy an upgraded version of the product they had shortlisted earlier.
The team gathers some basic information about what the consumer is looking for and what requirements they want the product to satisfy. After that, several products matching their criteria are shown to them, and they select the one. With upselling in the picture, the store will pitch the better version of that chosen product. And since it satisfies current as well as some additional requirements, the consumer buys the upgraded product.
Let’s understand this clearly with real-life examples.
Upsell marketing examples
Given that we all live in the modern world, a large population of the world is actively using the internet. However, it is vital that you first buy an internet plan. So, you check out agents, salespeople, and even your friends to get an internet connection. However, every time you buy a new connection or renew the existing one, you’ll always see an option to upgrade your plan.
Of course, there’ll be some lucrative benefits in the upgraded plan that seem necessary. Once you decide to buy this upgraded plan, the service provider completes an upsell.
The difference between upselling and cross-selling
|Areas of comparison||Upselling||Cross-selling|
|Axis of sales||Vertical Axis sales: a high-end version of the chosen product is sold.||Horizontal axis sales: relevant products are added while purchasing an item.|
|Accessing the target point||Upselling: In upselling, sales are made with a better product that satisfies customers’ wants and also seems beneficial for future requirements.||Cross-selling: In cross-selling, sales are made by adding products that are relevant to the buyer but were not initially intended for purchase.|
Similarities between upselling and cross-selling
|Areas of comparison||Upselling||Cross-selling|
|Increased customer satisfaction||Satisfy the customer’s requirements with a better and more suitable product.||To provide customer satisfaction by providing more than one product to tackle more than one requirement at a time.|
|Increased profit||To increase profits for the companies by selling high-priced products.||To increase the sales and revenue for the company by selling more products to a single customer.|
Why should you upsell and cross-sell?
With this, we hope that you understand what these marketing strategies are and how you can implement them. However, you might still be pondering over why you should implement them. In either case, the chances were high that the customer would convert that sale.
Since we got that right, we’ve gathered all the reasons for you to incorporate upselling and cross-selling into your sales funnel.
Increase your revenue
So far, you’ve seen that with either of these marketing strategies, sales and revenue both experience a boost. And both of them are essential to keep up with the brand and the business. You make specific suggestions to your clients, and they decide as per the budget and the requirements. As a result, your ROI on the business also increases.
Furthermore, a study from Forbes states that there are up to 70% chances of selling more to an existing customer. You can convert better within your existing client base and improve your revenue numbers.
Increases customer retention
This applies to upselling as well, as cross-selling. In upselling, a sales representative will probably introduce the customer to the product that they bought. Given that the product met or even exceeded their expectations, the chances are that customers will come back to you.
Your store has a wide range of options pertaining to a specific requirement in cross-selling. Be it a supermarket, a clothing store, or an electronics store. If customers can buy the maximum number of products from a single destination, they are highly likely to return to you.
This not only improves branding, but you can also generate business from the same client. In the process, your business gains the trust and loyalty of the brand.
Increases customer lifetime value
As we’ve already discussed in the scenarios, a customer tends to revisit the stores and outlets that offer him the best services and products.
Research on this aspect shows that gaining customer retention by as little as 5% can boost the revenue from that customer by more than 25%. Therefore, make sure you look after all your customers and give them a wonderful experience with the service and quality products you offer. Chances are they’ll be spreading the word about your business and brand among their network and add to your revenue in the long run.
How do you upsell and cross-sell products?
Although the implementation of strategies can take any form, here are some of the most common examples:
✅ Let them know about your best-selling products at the earliest. This will let them know you are doing good business with some reliable items.
✅ Train salespeople and store staff to connect with the customer and make relevant suggestions for their needs.
✅ Tell your customer why they need a particular product. This is helpful when your customers may get confused with the options in front of them. So, pitch in with valuable and distinctive features and help them select an above-expectation product.
✅ Make sure to suggest only those cheaper products than what the customer intends to buy. If the recommended items are more expensive than 60% of the intended purchase, the chances of converting them are decreased.
✅ Cross-sell products that are common and relevant, such as mobile covers, designer mugs, etc. These are the items that are helpful to the user now and then and are affordable.
✅ Be highly selective with cross-selling products. You have to attract the customer’s interest in items common in everyday life at reasonable rates. Proposing too many choices or high-priced items will not see the day of conversion soon.
Indeethatpossible effort. However, delivering the same or even better products and services is essential for their success in the long run. It is necessary to emphasize the power of connecting with the customers’ problems and offering them the optimal solution that fits their budget. This enables your business to tap into the best ROI with the best amenities for your buyers.Tags: branding, Cross-Selling, customer experience, Customer Experience Management, cx, CXM, Marketing, ORM, Sales, Upselling