The Wonders of Upselling

upsell/ˈʌpsɛl/verbpersuade a customer to buy something additional or more expensive.

Upselling: Selling more to the customer

Cross selling: Selling additional/complimentary products to the customer

Down selling: Offering alternative lower cost options to the customer

Key Learning Point.Its about a million times easier to sell something to someone who’s bought from you before than it is get a brand new customer. When customers are already buying, they are open to the idea of buying more

$190M in additional revenue

£44.95 Vs £52.0115.7% increase in basket value

Its hard to automate. While companies do automate this its hard to do and the research suggests you’ll have more success using a real human being to do this. I’d debate against that a ‘sales person’ is the best person to do this, most of the time PMs are.

A little works best. Upselling works best when there’s a small price difference between the product the customer is looking at and the item you’re going to suggest. EG you won’t be able to sell someone a Porsche who’s looking for a Skoda.

Keep key features the same. Don’t change the offering, it has to essentially be the same. This is because when the customer shopped for the original item they were trying to solve a particular problem.

Brand. Don’t underestimate the power/attractiveness of a particular brand. It might be because the customer is locked into that brand or simply addicted to it. Its very difficult to upsell and change the brand.

Sell the benefits. Make sure you clearly spell out the benefits of upgrading from what they were originally considering.

Rich’s Tips for Upselling

Pick your battles. Certain products work better than others for cross sell. Think like your local supermarket. You’ve done your shopping and you’re ready to complete your purchase but, ooo, what’s that? Chocolate bars, magazines, chewing gum, mints. Mmm, tempting. If they presented you with cutlery, flowers and frozen peas it would be a different story.

Watch the price. Cross-sell works better when the suggested items are half price or lower than the item being purchased. You’ll have more success convincing a customer to add a €200 DVD player to a €1,500 TV, compared to trying to cross sell using an €800 surround sound speaker system.

Relate the products. Products that naturally go together work better for cross sell. Such as adding a protective case and a car charger to the purchase of an iPhone, or paint brushes and wallpaper paste to the purchase of wallpaper.

Higher price, higher effectiveness. Cross sell tends to be more effective when the original product is higher priced or requires more thought. Cross sell is less successful when trying to convince a customer to spend extra when they were going to buy a lower cost item.

High Low versus Low High. Using higher priced items as cross sell for lower priced products is not the way to make cross sell work for you, even when the products are closely related. For example, suggesting a €300 pair of running shoes when your customer is spending €10 on socks is pretty impossible.

Rich’s Tips for Cross Selling

The Power of ConversationIn your workgroups. Please talk about….

What you can cross/up sell. What features you can remove to downsell.

Who is the best person in your business to do this?

How can you make it happen? What do you need to be good at?

In XX minutes we’ll stop, reconvene and elect one member from each group to present (2 mins) their key findings from each part (then we’ll go to the pub)…