If you want to brush up on your ping pong skills and decide it’s time to reinvest in a new pair of paddles to get the ball rolling, you can start on the internet. You reinvest some money into a new pair of paddles, a pack of balls, and you’re about ready to check out. Then, all of a sudden, you see a recommendation: a book to help you improve your ping pong game. You know you could use the assistance, and what’s $5 more to a $20 item? You go ahead, purchase it, and begin your training to become a ping pong champion.
If you can relate to this story, you’ve probably been upsold before. This example isn’t too far from the realities of upselling and cross-selling in online retail. Both parties benefit from the transaction, but it has to be done right. But what if you’ve already signed up for classes and don’t need the book? What if the book was $10 instead of $5? This blog post will make sure you don’t make these kinds of mistakes when upselling and cross-selling online.
The Difference Between Upselling and Cross-Selling
To avoid confusion in this article, let’s establish the differences between upsells and cross-sells. If a shopper purchased a rather outdated piece of technology, you can recommend a newer version. That’s an upsell. Offering a complementary product, like a belt to a pair of pants, is a cross-sell.
The Benefits of Upselling and Cross-Selling
Upsells and cross-sells can give you some extra cash in your pocket, and help move old inventory.
The benefits are great for customers, as well. Upsells can provide a customer with a later edition of a product they haven’t seen before. Cross-sells can help them realize an unknown need. You see cross-sells happen all the time on sites like Amazon, and for a good reason. But how can you make sure the recommendations actually work?
The Science Behind Upsells and Cross-Sells
Believe it or not, upsells are actually more popular than cross-sells. They make up 4% of sales for retailers, compared to .2% for cross-sells. The only time cross-sells are more popular is when they’re on the checkout pages, where they’re responsible for 3% of e-commerce revenue alone. Limit cross-sells to checkout pages, and make sure they only increase the order value up to 25%.
You also don’t want to annoy the customer with recommendations. Upselling and cross-selling are great for your bottom line, but the reason you’re doing it is to improve the customer experience. You want to make sure the customer is comfortable on your site, and make them feel helped, not obligated to purchase more products. Cross-sell customers with product recommendations by the checkout screen, or incentivize them by saying “spend $x more to qualify for free shipping!” They’ll get more, and the additional products can subsidize your shipping costs.
The best way to upsell is by offering side-by-side comparisons of your products’ tiers. Illustrate the products’ weaknesses and strengths with an easy-to-read graph providing product descriptions and costs. Be transparent with prices as well. Let them know how much each upgrade will cost, and discuss the specific benefits. The shopper will appreciate the honesty and consider purchasing the more expensive version.
Upsells and cross-sells can improve the user experience by personalizing it. Using data can help offer recommendations based on previous purchases and cart contents. Proper upsell and cross-sell techniques can provide you with extra revenue, and the customer with a new and exciting product.