Hearing the word “upsell” makes many people envision the sleazy sales people trying aggressively to push some unnecessary products only for the sake of their profit.
And this is not completely untrue since there are many people out there that upsell for the wrong reasons or at least they do it in a completely wrong manner.
That’s why upselling has a bad reputation among businesses and they are quite unsure if they should ever implement it in their working.
I, on the other hand, have different opinions about upselling. If used right, it can absolutely improve your performance and strengthen your relationship with the customers.
The key thing that is important to upselling is whether you’re upselling a product that is relevant to the original purchase and the way you do it.
Hearing that “do you want fries with that” when you’re ordering yourself a juicy burger after going out sure does come in handy, right?
But the upsells in, for example, car dealerships can be way too much for you and your budget and can really annoy customers to the point that they change their mind about the initial purchase.
In this post, I will explain what is upselling, what are the benefits, and how you can do it in ways that are not too pushy and intrusive.
What is upselling?
Upselling is encouraging the customers to make an additional purchase in the original purchasing process to make the primary purchase upgraded and more expensive.
So basically, if we stick with the burger example from before, the fries are the upsell. You go to the burger place and order the burger, they ask you if you want fries, you’re hungry so you say okay.
Then they ask you if you’d want a drink with that, you realize you’re thirsty, you say yes.
And that’s how you just bought three products even though you initially wanted to purchase only the burger.
This is a simple example with a simple good, but the upselling techniques can be applied to all types of products and services and really increase the revenue of the business.
Many people confuse upselling with cross-selling which is a similar practice but there is a difference.
Cross-selling means trying to sell a completely different product to the customers that can be possibly related to the product that the customer already bought.
For example, if you are buying a phone online and you finish the purchase, next you will see related products that will try to sell you a protective glass for the model of phone you purchased.
So to sum up, upselling is trying to sell an upgrade (premium account, better version, etc) of the product in the same purchase, while cross-selling means offering a related product for additional purchase.
Both techniques are extremely valuable if used right.
Benefits of upselling
- Building deeper customer relationships: upselling does not have to be a dirty and pushy tactic to make your customers overspend. If you do it the right way, you will be helping your customers out with adding more value to their purchases offering them a better deal. This can make them very satisfied with your business and can build loyal relationships.
- Revenue increase: this is a very obvious benefit. It’s the main reason why businesses get into upselling and cross-selling. It is much harder to sell to a new customer than it is to sell to an existing customer. This means that upselling targets those customers that are already convinced that they should do a purchase from you. Upselling your existing customers is a cost-free way to increase revenue. If you engage them in the right way and explain the advantages of the upsell properly, upselling can bring a huge difference in your revenue.
- Better customer experience: if your customers receive better and more targeted treatment that it’s in their best interests, they will have a better overall customer experience with your brand. In the long term, this is very valuable. Your expert opinion means something to your customers and by telling them the right way to enrich their purchases which brings them additional value, you are making sure that your relationship is getting stronger. Happy customers equal loyal customers.
- Returning customers: upselling leads to increased customer lifetime value. This means that the contribution that your customer makes over time will be increasing. Upselling is a very good tactic for turning customers into highly profitable customers that return to your business when they have a need from products of that category.
How to upsell: tips and tricks
The techniques and ways in which you choose to upsell to your customers should be tailored to fit the type of business you have.
There are a lot of ways in which you can make sure that the upselling you do is done properly, and here are some tips that can help you in the process:
1. Think of your customers’ needs
Upselling is primarily done for increasing revenue, I get it. But if you want to upsell effectively and keep your customers then you have to do it right.
Doing it right means putting the needs and wishes of your customers in the first place.
This means that you have to acknowledge that your customers can differ between themselves a lot. Not all of them fit into the same upselling technique.
For instance, if you are offering some online services and you have them divided into three plans; basic, premium, and for business – It’s logical that you can’t offer the basic customers and those that are purchasing the service for whole big corporations the same upsell.
Try to see things from the perspective of the customers and think about what would be the right upsell for you if you were the customer.
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This type of personalization in the upselling process can bring a lot of positive results and meet the needs of the customers properly.
2. Offer a special reward
You have to push, respectfully, towards a decision-making process. The customers already spent the time choosing the product and made the decision to start the buying process.
You convinced them to do the initial purchase, and while they are in that buying mode you have to offer a good incentive to make them want to participate in the upsell process.
That is why upselling techniques are usually on the checkout screen and are trying to push customers to do an impulsive buying decision.
Offering them something special at this point might make their decision-making process much easier and make them go through with the upsell purchase.
For instance, you can offer them a 15% discount if they upgrade to a larger or newer version of a product.
This can work because they already decided to purchase something, so they might convince themselves that if they are doing the purchase they might as well make the most out of it and get the newer version.
3. Upsell after the original purchase
There are many different ways to upsell and sometimes businesses do not wait for the purchase to happen to bombard customers with upsells.
Although this might work for some businesses, generally it is not a good practice.
The reason is that it can be extremely annoying and turn people off of making any purchase whatsoever if you are being too pushy.
If you are thinking about purchasing a product and you are not quite sure, upsells before you make the purchase can just make you change your mind altogether and abandon the site.
That is why upselling is best done in my opinion after the initial purchase takes place.
The customers are then in the buying mindset and already made peace with spending a certain amount of money.
If you offer something better they can have the “if I am spending $100 dollars on this, I might as well spend an additional $30 and get the better deal” mindset.
4. Do not be pushy
Whatever you do, do not be pushy. This is exactly how the upsell tactics got such a bad rep- because business overused them and in a manner that’s too aggressive to customers.
You want the customers to see the upsells and to see the advantages of them, but you don’t want to be so annoying that they have a bad experience on your site.
Present the upsells at the right time and the right places. Avoid aggressive pop-ups that come up all the time.
Many online businesses are even putting the upsell under the product information so it’s there for people to see at all times.
I will mention this again because it’s important, upsell after the original purchase. There is no reason to pop up an upsell to people that are just landing on the website.
It can make people leave before even actually seeing what you’re offering.
5. Be transparent with prices
Imagine if somebody asked you to pay more of your hard-earned money for some additional benefits that are vaguely mentioned.
You could feel like somebody is trying to take advantage of you for the sake of their profit.
When you are offering an upsell to your customers, be transparent!
Give thorough information on what the added benefits are, how they can serve you, what else you can do after that, and so on.
Give a detailed price breakdown that is completely transparent with no hidden or additional costs.
If a customer knows all the details about an upsell they are much more likely to get involved.
In businesses where the price is unknown and has to be figured out, explain the criteria on which the pricing is determined, and have personal contact with the customer.
Customers trust other customers because they are on the same side of the transaction.
Find a way to provide social proof to the customers to let them know that other people purchased the products from the upsell and liked them.
Whatever way works for you, reviews, ratings, quotes from customers, product reviews, etc.
Tell customers what other products people bought with the original product, what people looked at, recommendations, etc.
These things will only further reassure customers to follow through with the upsell purchases.
Upselling can be a great thing for your business and not only for the possible increase in revenues.
The bigger picture here is that you can earn the loyalty of your customers by offering them a bigger value at a good price.
Happy customers are loyal customers.
Remember to use the upsell in the right place and at the right time. And learn when to stop pushing with the upsell.
In the end, you have to figure out what works for you specifically and combine those practices until you have the perfect results.
If you found this post helpful and want to learn how to make your business even more successful check these other posts:
- All you need to know about CPA marketing
- Here’s how you should do relationship marketing
- How to Respond to Customer Reviews to Improve ASO Rankings
Have you tried upselling? Leave a comment letting me know what was your experience with it.