It’s always a great feeling when a sale has been agreed upon. But for a savvy business owner, that is often just the beginning. Once a customer is converted, there is an opportunity to further increase your sales and the value of that customer. This is where upselling and cross-selling techniques come into play.
First, let’s clarify the difference between upselling and cross-selling:
Upselling is where, after making a sale, the product sold is upgraded to one of higher value.
Cross-selling is where further products are sold to the customer after the initial sale is completed, thus increasing the total cart value.
According to well-known business consultant and author, Jill Griffin, “the probability of selling to a new prospect is 5 to 20%. The probability of selling to an existing customer is 60 to 70%.” This means, once the customer has already said yes, they are much more receptive to suggestions to increase their purchase, either through upselling or cross-selling.
Below you will find our top tips for maximising each sale opportunity by using these two techniques:
- Keep options limited
When offering the customer an opportunity to upgrade or add items to their purchase, it is often counterproductive to offer a large number of potential options. This gives the customers a large number of variables to consider, which hinders their ability to make a final decision.
Keeping the offer simple is key.
To upsell successfully, you need to present them with a solution to their problems, not more confusion and complication. The same goes for cross-selling. Present one or 2 options that will supplement and add value to their existing purchase, rather than a large list of items that will quickly become confusing.
- Bundle complementary items
By selling products that complement each other in bundles, you are able to encourage both upselling and cross-selling. Some basic preparation is advisable for this technique – it is helpful for some thought to be given to the way that products can fit together prior to your interaction with the customer.
By thinking of products as a part of a bundle, you will be able to better explain the benefits to the customer and help them to see how the products within the package will interact to bring them more value.
- The rule of 25
Studies have shown that the optimal amount to increase a basket through upselling and cross-selling is 25%.
This means that as a general rule of thumb, you should look to either upsell or cross-sell up to, but no more than 25%. As the figure rises beyond 25%, the change the customer will reject the offer increases.
- Get to know your customers
The more you know about your customers, the easier it is to understand what their needs are and how to cater to them.
You can build up this knowledge and awareness by conducting some prior research to understand the demographics of your customer base and then asking them questions about their needs, why they are looking to make the purchase and how they intend to use the product.
Every piece of information about the customer that you can gather will help you to better provide them with the products that will bring them value.
- Help them finance the purchase
Sometimes, a customer will see the benefit of the upgraded or additional product that you are offering them, but won’t have the disposable funds to complete the purchase right away.
By offering finance, businesses are able to enable customers to be more receptive to additional options and can thus more successfully increase conversion and basket size through upselling.
CreditDigital provides a simple and seamless way to quickly allow businesses to connect with reputable lenders and offer their customers convenient finance options. Offering finance together with the techniques described above is a great way to increase your sales through your existing customer base.