Cross Selling and Up Selling
Think about how much time your customers spend to evaluate, compare and decide to buy the products on your eCommerce website. Probably when they do you are very satisfied and happy to have made the sale. But why just be satisfied? You could be leaving money on the table if you aren’t utilizing two of the oldest and effective sales tactics – Cross Selling and Up Selling.
These methods have been around for a long time, and are actually so ingrained into your every day spending that you may not even realize when it’s being done. Cross selling and up selling techniques are so practiced that you would have experienced it many times already, and even actively partaken in the offer presented to you.
Well, now you can take advantage of these strategies and implement them on your eCommerce website.
What is Cross Selling?
“Cross Selling is the practice of offering a consumer a product or service that is related to the goods/services they’re interested in as an additional or complementary component.”
Cross selling does not consist of the combination of random products but is the result of product analysis in order to offer the best possible related options.
Cross Selling Examples
Have you ever entered a fast food restaurant with the idea of ordering only a burger and you came out of there with exactly what you were going to take, and that’s it? Probably quite often, but no doubt, there have been times when you didn’t fare so well.
This spawns the classic line: “Would you like fries with that?”
Cross selling offers the consumer a related product or service that goes hand-in-hand with what they’re already going to buy.
In this example, the server at the restaurant offers fries to go with the burger.
This can actually be the first stage of the cross sell.
Whether the consumer agrees to the fries or not, the server can then offer a drink, either as a substitute for the fries the consumer didn’t want or as an addition to make it a combo meal.
If the server was successful in getting the consumer to go from just a burger to a combo meal, they have effectively increased the profits and conversion rate by a measurable amount.
Cross Selling Strategies
The Complimentary Strategy
Do you remember doing classroom activities at school and you had to pair related objects together?
The bird went with the nest, the fish went with the tank, etc.?
With an eCommerce website, for example, you can offer the purchase of a joystick or a video game, combined with a console. The methods used to propose a related product are many, the most classic is the “You may also be interested in…” which are followed by three or four products related to the customer’s choice.
This could also be used for services as well.
Let’s say that you sell wooden doors.
When the customer gets to the cart or checkout page, you could offer them an installation service, where your company will go to their house to install the new door and take away the old one if needed.
This can save the buyer a lot of time by getting a professional to do it for them, with the added bonus of removing the old door if they don’t want it anymore.
You’ve probably noticed that Amazon uses this cross selling strategy:
The Shop The Look Strategy
This one is popular among clothing and fashion retailers.
Have you ever been shopping online for clothes and saw a really nice top or shirt that you like?
Perhaps the product photos also show the model wearing a watch, belt, jeans, shoes, and hat as well.
Your focus is still on the top or shirt, as that’s what you’re interested in, but there’s a section underneath titled “Shop The Look” where you can purchase all the other items that the model is wearing in the photo.
The Sold Separately Strategy
I’ve you have purchased from Ikea before you may have noticed this one.
Let’s say that you’re on an eCommerce website and you are interested in a lamp.
You add it to the cart, proceed to the cart page and you’re greeted with a section that says:
In that section, is a lightbulb.
Many people forget that bulbs are needed for lamps when they purchase them, and quite often they don’t come with them either.
The consumer could order the lamp and when it arrives at their house, realize that they need a bulb and go out to the supermarket to buy one.
Or, they could realize from this cross selling strategy that they need a bulb and don’t want to go to the supermarket to buy one, so they instead purchase it with their lamp.
These techniques can be exploited at different stages of the purchase process: You can already propose it on the product page, or when the user is in the cart and is completing the purchase or even after the order with a thank you email and a discount on the purchase of a related product.
What is Up Selling?
Upselling is a technique that is designed to persuade a potential customer to purchase a comparable higher-end product than the one they are interested in.
For example a Mercedes SLK350 instead of an SLK250.
This technique can increase eCommerce revenues by a healthy margin. For example, in 2006, when Amazon introduced this method, it increased revenues by 35%. Amazon is not the only store that uses this technique, upselling is exploited by many retailers.
Just go to a product page to be projected into a parallel world and know what other users have bought, what they would buy, what you might like, what you can buy, etc.
When you add the item to the shopping cart it leverages the decisions made by other users, people like you, and shows you “what customers have bought” that is similar but of a different brand, possibly at a more advantageous price.
This could possibly be the most effective upselling strategy there is and can be adapted to many different other methods.
As the name implies, you are showing the consumer a comparison.
This makes it easy for them to see all the related options available and make a decision with all the information in front of them.
A good example of this is in the SaaS industry with their different levels of packages.
Take a look at Spotify making it easy for you:
This table clearly shows you what you get, and what you don’t get if you choose either option.
Obviously, the premium version will make Spotify a lot more money than the free version, so the differences between the packages are deliberately large and highlighted.
You can see how on the free version the differences are whited-out, while the premium version boldly shows that those features are included and you also can start a 30-day free trial too.
The Version Upgrade
Let’s say you sell smartphones.
A consumer puts a particular model phone into their shopping cart and is then presented with upgraded versions of that model to compare to.
You have probably seen this on Amazon, and it’s a very effective upselling strategy.
The consumer can clearly see the difference between the model they are interested in and other upgraded versions. They could then be more inclined to purchase an upgraded model because of this where they weren’t interested in it before.
The Similar Product
Here, we are looking at the website of fashion giant Nordstrom.
They have a nice jacket that they’re selling for $125.
But, if we look at the right sidebar, they are upselling us with comparable products under the heading “People Also Viewed”.
They are not ordered by price, and look as though they are randomly ordered, although they are all higher in price than the item we are looking at on the left.
This strategy is perfectly fine and there’s truth to it as well.
Their website gets millions of visitors every month and people also did probably view those comparable items in question. The similar products that have been recommended are also very well categorized, so there’s also a good chance that the visitor would be interested in them.
Also another feature you’ve probably encountered on Amazon.
This upselling technique in retail works well for eCommerce websites that have a lot of product ratings.
Let’s say a consumer is viewing some headphones on an eCommerce site, but the headphones only have a three-star rating.
If the consumer scrolls down, they are presented with comparable products which have much better ratings than the one they’re looking at.
With the importance of ratings and reviews online, the consumer could be far more inclined to now looking at those other, and likely more expensive products as a result.
So What About Cross Selling and Up Selling?
In reality, cross selling and up selling can benefit both parties involved.
The customer is satisfied because they find what they need, thanks to you; while you increase your earnings. If you have proposed the right products, the customer may return and buy something again.
When a customer first enters your website, they are not likely to be ready to make a purchase.
This would be a bad time to show them upsells or cross sells.
When a customer adds a product to their shopping cart, however, they would be more inclined to be ready to spend, or at least considering it.
The best time to offer upsells or cross sells if after the user has shown interest in buying something.
This could be considered as viewing a product page such as we saw on Amazon and Nordstrom.
You need to decide with cross selling and upselling strategies will work best for your brand, and what your eCommerce websites users would be more receptive to in order to get the most out of it.