In the first part of our blog series on Upsell and Cross-sell techniques, we explored the difference between the two, and their benefits for e-commerce businesses. Now, let’s discuss a few effective upsell and cross-sell tips to increase the sales, and also which one should be your ideal choice.
Upsell and Cross-sell Tips
- Upsell or cross-sell products which are most sold. A product which is popular, the best and most sought after will tempt the customers to own one for self too.
- Upsell or cross-sell products which most reviewed. According to a study, 90% of customers affirm that their buying decisions are influenced by online reviews. However, do ensure that you pick only those reviews which have the best ratings and positive/unbiased reviews.
- Don’t offer too many choices of products; ideally the number should be limited to three. Or else, the customer will switch back to the research mode and may abandon the cart completely. A study shows that revenues can boost by 5-40% and costs can come down by 10-35% on reducing complexity and narrowing down choices.
- When upselling, give customers three price variants – least, mid-range and most expensive. Depending on customer’s pocket and lifestyle preference, he will choose the one that suits his requirements the best. However, do ensure that the prices of upsells do not exceed 25% cost of the core product or else the upsell offer will look overwhelming to the customer.
- Create a sense of urgency and scarcity. For instance, only 5 items left in the stock or only 2 days left to avail the discount. This will create a psychological pressure on customers because they don’t want to lose the exclusive offer. Hence, they are most likely to pre-pone their decision to buy the product.
- Offer some ‘extra’ benefit. It could be anything – free shipping, free gifts, free demos, incentives or discounts. You may even attach a condition of a minimum order size to avail these benefits. This ‘extra’ will add value to the customer’s purchase and certainly seal the deal for you.
- Upsell and cross-sell only what is related to the product and relevant to each customer’s buying preferences, likes and dislikes. So, recommending a desktop when customer is looking for a notebook is not the right sale. The upsell or cross-sell product should not lower the importance key attributes of the original products, but come along with upgraded features or complementary products that exceed a customer’s base expectations. The customer should realize the value for money.
- In order to ensure that upsells and cross-sells happen automatically without any manual intervention, it is advisable to choose only those e-commerce hosting platforms which have plugins or extensions.
- Sell in bundles or offer complementary products at check-out. You can group different items related to the same category of the product and offer them together at a discounted price. Remember, how McDonalds or Pizza Hut display combo offers in their menu list? So, why not maximize the average order value by probably bundling together a laptop and a wireless mouse or a laptop and an external hard drive?
- Display upsell and cross-sells prominently, such as on a sidebar widget so that they catch the eye of customers quickly.
- Try post-purchase upsell and cross-sell, that is, when the customer has completed the transaction. It won’t look like a marketing gimmick and go a long way in nurturing the customer relationship. The upsell recommendations can be displayed on the post purchase page of the transaction (your order is placed now) or included in the email receipt.
When Upsell Works?
It works when the price and feature differences in the each category of products are not substantial, and you have substitute products to offer as well.
You may not be able to upsell if you have a binding agreement with the vendor to sell the products as stand-alone or not show comparisons with the competing brands.
When Cross-sell Works?
Cross-sell works when your product ranges also includes small-ticket accessories to complement the original product. The thumb rule is that cross-sell item should be 50% or lesser price of the original product.
It doesn’t work when you try to sell the cross-sell product as a primary product. This is called reverse cross-selling. For instance, selling a keyboard along with keyboard cleaner. The right cross-sell combination is selling a keyboard cleaner with a keyboard.
Which is Better – Upsell or Cross-sell?
Statistics indicate that upselling drives more than 4% sales as compared to mere 0.2% sales through cross-selling. This clearly highlights that upselling is 20 times more effective than cross-selling online.
However, if cross-sells are displayed on the checkout page, sales can increase by 3%. And, we have an amazing case study of Amazon which claims to have 35% of sales coming from cross-sell.
The bottom line is that upsell and cross-sell are important tools for e-commerce sales. As you can see, both techniques have more merits than drawbacks. It is how you implement them effectively can make all the difference in the results.