How To Apply Upselling And Cross-selling To Double E-commerce Sales?

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Have you ever heard of upselling and cross-selling?

If your answer is No, let’s go for specific cross-selling and upselling examples:

“With Spotify Premium, you will get unlimited skips, no ad interruptions, and offline songs. Get it now for $9.9 per month.” – said Spotify ads between songs.

Or “Do you want any chips? It goes really well with our chicken nuggets.” – said Mc. Donald’s seller getting your order.

These two questions sound more familiar. If you already are a Spotify Premium member or once agreed with the Mc. Donald’s seller means their upsell and cross-sell services perfectly meet your needs and, at the same time, create more profits for the company.

As a shop owner, why don’t you apply these two methods to your own business? We are here to help you master both of them, selling additional products and boosting your revenue. But first, let’s figure out the upselling and cross-selling definition…

Differentiate The Upselling And Cross-selling Method

What Is Upselling?

Upsell, understood, is a sales trick to direct customers to more expensive options in the purchasing decision process. The products usually are premium versions of the ones that they intend to choose.

upselling examples

The upselling method is applied in many popular businesses, and one of those is Spotify. Regularly, you don’t need to pay any fee to listen on this platform. However, there are some limitations. With a basic account, you cannot play specific songs, shuffle between songs, or skip ads. As a result, Spotify immediately offers you a great deal: paying $9.9 per month to upgrade to a premium member. By getting this deal, you can get rid of all those above problems and are free to download their songs to your device.

Whenever you acquire your customers a higher price point on a current service they have already had, it is evident that this will help your business increase sales value.

What Is Cross-selling?

Have you ever been to Mc. Donald’s and heard this familiar question after finishing your order: “Do you want any chips?”. This is the most popular example of cross-selling in business, in which hamburgers and chips are cross sold, and the chips are considered supplementary products.

Another common cross-selling application is the section of “Frequently Bought Together” or “Customers Who Bought This Item Also Bought” in eCommerce websites.

cross sell examples

Basically, cross-selling is a sales tactic in which businesses encourage customers to purchase additional product or service and the main product. We often encounter this trick in businesses that retail phones, household goods, or other business areas.

That is the reason why purchasers always end up buying more than their first intention. Even when they are at home, and there is no persuasive seller, their phone will keep popping up with new notifications about products launches or membership promotions.

Why Upselling and Cross-selling Are Necessary For Business Development?

benefits of cross-selling and upselling

Boost Sales

It is estimated that 35% of Amazon’s revenue comes from cross-sells. As a matter of fact, Amazon is the champion for cross-selling in eCommerce, mastering product recommendations via collaborative filtering.

By applying upselling and cross-selling methods, it is evident that your business will get more profit. Upsell leads your customers to the most expensive offering, whereas cross-sell helps your business sell more items.

Increase Conversion Rate

Conversion rate is the percentage of website visitors that complete their goal (a conversion) out of the total number of visitors. A high conversion rate in a business indicates that your customers feel satisfied with your offerings and are likely to purchase them.

When you recommend reasonable deals through the upselling and cross-selling methods, the customers will feel that you are providing useful items and convenience and flexibility. This obviously will lift their shopping satisfaction with your business.

Enhance Business Loyalty

A study from the book Marketing Metrics pointed out that:

  • Sales profits from a new buyer are 5-20%
  • Sale profits from an old buyer are 60 – 70%

It is easy to understand that people always tend to get products from previous brands that had a good impression. That is the reason why you should leverage your relationship with existing customers.

Upselling and cross-selling can benefit both new and old customers. The purpose of these two methods is to show that you are really into their problems and trying to help by offering a better version or a package of relevant items.

So, be a helpful friend advising your customers instead of pushing them to purchase.

To previous customers: “Hey, I helped you last time, so don’t worry. Please have a look at these items”.

To new customers: “Hi, even though we have just met, I know I can help you with this. Let’s check our recommendations.”

How To Implement Upselling and Cross-selling Campaign Efficiently?

3 Ways To Powerful Upselling

Offer premium options

This is the most used method to upsell in business. It refers to recommending customers buy a premium version of the product they have already been interested in.

To apply this marketing technique, make sure the premium version has special features outstanding to the regular ones.

Promote top products

Whenever the purchasers have no idea what to buy, they always look for the bestsellers or the most reviewed products.

The bestsellers are the most sold products of your brand. These items might have functions that meet a lot of customers’ needs. You must stick to these advantages to encourage more people t buy them.

The most reviewed products also play an important role in your business. People tend to look for others’ experiences on the products before making a purchasing decision. The more positive feedback the customer heard about the product, the more likely they are going to buy it.

Choose the right time

Timing is key in marketing.

When your audience is in the early and mid-stage purchasing process, it is a perfect opportunity for upselling. Upselling offers are a way of educating them on the multiple options your business has for their problems.

3 Ways To Powerful Cross-selling

Offer product package

Bundling is probably the most common way to cross-sell relevant items.

A bundle can be an effortless attraction to customers because it often includes useful and relevant products at a more affordable price.

To create reasonable bundling deals, make sure the bundled products can be purchased separately as well – of course, with a higher price than the bundle. Showing the extra savings will encourage buyers to purchase a package of items instead of just an initial one.

For example, if your customer is checking a new mobile phone, you should offer them a package including a phone, a headphone, and a charger. These items are necessary for a new phone and work well together, so the customer will not have to buy each one of them. It will save them a lot of time as well as money (if you offer the package at a lower price than the three items).

Give recommendations on the product page

Showing a list of suggestion products is an effective way to cross-sell.

For example, when the customer checks a white T-shirt, you should suggest other items that go well with it, such as a black skirt, a bucket hat, or some accessories. As a result, they will be more likely to buy all of them because they are a great combination.

That is the reason why the “You may also like” feature plays an important role in pushing sales.

Besides, the “Others also like” list is also beautiful to customers. At least, it makes them curious about other choices. Furthermore, they might add some listed items into their cart.

Take advantage of the shopping cart/ checkout page

The cross-selling process does not end even when your customers have checked out every product page and all the “You/ Others may also like” lists.

Make sure you place the cross-sell products exactly at the shopping cart. Moreover, you should ensure that you introduce them when the customers start reviewing their cart.

The checkout process is another thing to be considered. The last stage of purchasing requires buyers to fill in important information. As a result, they will focus on anything that might appear, including the cross-sell items advertisement popping up on the page.

3 More Tips For Both Upselling And Cross-selling

how to apply cross sell and upsell to ecommerce

Offer deals that make sense

You shouldn’t offer your product recklessly.

In fact, 91% of customers lean toward brands that remember them and provide relevant offers. The upsold or cross-sold products must be relevant to the initial ones that the customers are considering or available in their shopping carts. Suggested items should lead to their unsolved problems, or else you will end up losing a sale.

Make use of dummy choice

For example, consider your customer looking for a camera, and the camera always needs a compatible lens. So, your brand will give him three options:

  • Option 1: A camera at $1,000.
  • Option 2: A camera lens at $200.
  • Option 3: A camera and a camera lens at $1,100.

No one will opt for the second choice – which is called the dummy choice. Dummy choice is a misleading option to direct customers to choose other remaining ones. There is a high probability that the customer will get the last deal – also the most expensive deal in the above case. This simple trick will help increase order value.

Repeat recommendations

You should make use of popping on-web notifications. If your business uses Magento PWA Theme, it will allow sending daily notifications to buyers’ mobile phones even when they are not surfing the web.

Moreover, you can provide them a coupon, discount, or free shipping or create a sense of urgency by a time-limited offer.

Using the Thank-you page and follow-up emails are good upselling and cross selling opportunities for convincing your customers to spend more on their next purchases. Besides, it will not interrupt the shopping process. Thus, there’s a higher likelihood that the customer would be responsive to the offer.

FAQs

Which One Is More Effective? Upselling Or Cross-selling?

It is difficult to evaluate the two techniques.

According to statistics from McKinsey, cross-selling can boost sales by 20% and profits by 30%. Besides, some studies have shown that upsells are 20 times effective than cross-sells.

However, take the statistics for reference. If you think one of the methods (or maybe both) is suitable for your brand, you should opt for it.

What Are the Disadvantages Of Upselling And Cross-selling?

  • A poorly timed upsell and cross-sell can lead to losing potential customers.
  • Accidentally become the pushy brand that compels buyers to purchase more items.
  • Over upsells or cross-sells interrupt the shopping experience, which can be distracting to customers.
  • Upsell technique requires a various range of price (low, medium, high) in a product line.
  • Cross-selling mainly depends on personalization. This usually requires some automatic solutions from the site’s backend.

Last Notes

These two tricks are great tools for increasing revenue for any service industry. However, they are also a double-edged sword. If you approach your customers with too many offerings by upselling and cross-selling, they will easily feel annoyed, and their shopping experience will worsen.

On the other hand, if applied correctly, a harmonious combination of both methods, up-selling and cross-selling, will bring about mutually beneficial transactions.

We hope that all the above information will help you find the most effective way to boost revenue.

Let us know whether you choose to use these two methods on your online business or not? We are glad to hear your comments!

Giang LeHow To Apply Upselling And Cross-selling To Double E-commerce Sales?

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