Common indeed, because we get it so often! People often confuse the difference between cross-selling and upselling, because both are similar in nature. That’s why we decided to dedicate an article to upselling and cross-selling, explaining in detail what they are and how they are different from one another.
One thing which is common among upselling and cross-selling is that both are sales techniques. Both are designed to entice customers to buy products or services, generate revenue for the company, and increase order value. That’s the endgame of both upselling and cross selling.
But let’s figure out what each one actually is:
Upselling:
Upselling is one of the most common sale strategies used by various businesses, especially on e-commerce platforms. What it does is basically driving customers to purchase a more expensive version of a product they have decided to purchase. More expensive in the sense that the package in question has more perks to offer than what the customers originally choose. This technique works best on existing customers, because the statistics show that it’s easier to upsell to them than new customers.
Here’s an example:
Let’s say one of your customers purchased a pair of headphones a while back, and they have decided to buy the same ones again. You can offer them modified versions or updated versions of the same headphones. This is called upselling.
You can usually use the upselling strategy at three phases of sale: before the sale is made, as the sale is being made, and after the sale has been made. The difference is just how you present things.
Same Approach, Different Tactics
For the best upselling strategy that actually works, you will need to have a very clear comprehension on what your customers are looking for, and adjust your marketing strategy to that. If you are not careful with how you present things, the customers will take the upsell the wrong way and end up dissatisfied. You want to make sure that the products you are upselling are not too expensive compared to what was originally purchases. Also, do not force-feed the upsell. You want things to be as subtle as possible.
Another good technique when it comes to upselling is created a limited-time offer, like “Hey! Get this cool new offer while there are still items in stock!” or “Only two days till this offer expires!” This is a great marketing technique to incite customers to purchases products and spend more money.
Another thing you can keep in mind is that whenever customers purchase items from your business, you collect data. You can leverage that data to know what exactly they are interested in, and then offer them those items during your upsell!
Here’s an easier example of upselling that most of you might have seen:
When you order French fries at a McDonald’s, the person behind the desk always says: “Do you want to supersize it?” They are upselling you with an “upgrade” of the product you are already familiar with.
So, What Does It Mean to Cross Sell?
Now that we’ve talked about upselling, let’s move on to its cousin, cross-selling.
Just like upselling, cross-selling is another of the most popular marketing strategies which businesses use to generate more income and sell more products.
But what exactly is it?
Let’s say you are selling a product that does tasks A, B, and C, but cannot do task D. You can offer your customer another item which will satisfy task D. Sound fair enough? For example, if you are selling a shaving kit that does not include a nose hair trimmer, you can offer your customers a nose hair trimmer as an option. It’s related to the original product, yet it solves a problem that the original product could not solve. This is basically what we call cross-selling, and it is commonly used in ecommerce.
Almost every product page on any online platform is busy cross-selling to customers. Take Amazon, for example. Every product page on this platform cross sells a related product. You will usually see a sentence such as “This item is often purchased along with” and then you will see items similar to the product you want to purchase, but with different efficiency.
Here’s another example:
You are going around a music store to pick out a guitar. A sales representative will approach you, and they will offer you an extra accessory, such a guitar strap, an extra pack of strings, guitar picks, and similar things. What the sales representative is actually doing is cross-selling you products that are often used with the one you plan to purchase.
Different Tactics Again:
Here are some tips which you can utilize when implementing a cross-selling marketing strategy:
Make sure the products or services you are trying to cross-sell are actually related to the original product/service the customers are buying. Remember, you need to offer them value with the items you are trying to cross-sell.
Another effective strategy which you can use when cross-selling, is offering your customer a “bundle” of related items which they can purchase under the guise of saving money. Here’s a better tip: make sure the bundle comes as at a discounted price! You can even cross-sell something as simple as an article. If someone is reading an article on a website, they will generally see a “related articles” section which takes them to new articles that might be related to the one they were reading. This is also a way of cross-selling, because clicks bring sales in short amounts of time!
Seeing as you are now aware of what cross-selling is, let’s take the time to talk about the main topic we’re all here for:
The Difference Between Upselling and Cross-Selling
As you may have noticed, even though both cross selling and upselling are marketing strategies designed to attract customers and generate revenue through sales, there are minor differences between the two techniques.
Upselling usually attracts customers who have already been purchasing from a business and know the products/services. Instead of offering new or additional products or services, upselling typically provides an upgraded version of a product which consumers have already been buying. For example, if you are offering customers subscription packages, an example would be to make a premium version of the same package available for people to purchase. This can include better perks, and perhaps a longer subscription period that people might like. Same goes for any sort of product you are selling cross various platforms. Offer upgraded versions of existing items through an upsell, add value to the purchase, and you should be good to go!
Cross-selling, on the other hand, focuses on relevant or related items and services to customers. That’s why it works better on new customers, as opposed to existing ones who already know what they are buying.
Which One to Choose Between Cross-Selling and Upselling
To upsell or cross sell? That is the question! Well, it all comes down to you, your company, your business, your customers, and your products! Any company or business can benefit from both upselling and cross-selling. In fact, you can upsell and cross-sell at the same time! The two are not mutually exclusive. You can pick and choose which one you use for which product, which service, and targeted at which category of customers.
Whether selling items or services, or whether catering to existing or new customers, you can benefit from both cross selling and upselling! So, gear up, study your business, your customers, and your products, then decide on what you want to upsell and cross sell.
Or, just let us professionals handle it and save you time! Here’s something you should know: we are skilled at creating effective upselling and cross-selling strategies that will help you sell more products to your customers, increase revenue, and let you benefit from the best sales experience you will ever have!
Check out our website to see which type of upselling and cross selling strategies we can bring to you!
