Updated: Nov 28
As competition soars in all markets, there are several options for your customers to choose from. This, in turn, means that people will, and do, leave brands at the slightest hint of inconvenience.
To survive in a world of cutthroat competition, you need to create and deploy strategies that help you connect with customers, persuade them to shop with you and become loyal to your brand.
Cross-selling is the process where you recommend complementary products to customers based on what is already in their cart. Upselling, on the other hand, entails getting people to buy a product of a higher price, but with more benefits.
When used correctly, both cross-selling and upselling can engage customers by providing them with highly relevant and personalized experiences.
A cart-value upgrade: Upselling and cross-selling
Increasing the cart value of a shopper is one of the primary focuses of any business. Higher cart values drive better revenues and improve margins for sellers. Therefore, here we discuss upselling and cross-selling and how they can help raise cart value for your brand.
Understanding Upselling and cross-selling
Upselling is a sales strategy that encourages customers to purchase premium and more expensive versions or models of the same product. The goal of upselling is to increase the value of the cart by increasing the average price of products in the cart of a customer.
Cross-Selling is a sales strategy that attempts to persuade customers to purchase similar, complementary, or additional items with their existing in-cart items. Sellers can advertise similar items or items that may upgrade or complement the current cart of a customer. This strategy works effectively for conversion as well as retention.
The value of relevance
An important part of both upselling and cross-selling is the relevance of the products being recommended. It is critical that any suggestions made to a customer are relevant to their preferences or in-cart items.
There are two main reasons why recommendations made for upselling and cross-selling must be relevant to the customer in question:
A customer is more likely to buy a product that is related to their current purchase. Since the customer has an intention to buy something specific, recommending an unrelated item is likely to yield no interest from the customer. Therefore, it is safe to assume that the odds of upselling an item are relative to the relevance of the recommendation.
When customers notice relevant recommendations, a platform shows that the customer’s needs are understood. Highly relevant recommendations show them that you do understand their needs and wants. As a result, the customer is likely to become more comfortable shopping with the platform, leading to brand loyalty.
Ways to cross-sell and upsell to customers
Here are some of the most successful strategies to upsell and cross-sell items.
Three ways to Upsell Products
1. The Help Factor
A great way to upsell an item is to help a customer understand how it helps their motive for the purchase. By educating the customer on how an upgrade can serve their purpose better or bring more value to them, an upsell is likely to be successful. We usually see this on marketplace websites where they compare products of a similar category on a host of features and give a customer the chance to pick what works best for them. An eCommerce brand can follow a similar path to upselling by clearly highlighting the features and benefits of each product variant.
2. Value for Money
A big downside to upselling (see what we did there?) is that the upgrade is a more expensive alternative to the existing preference of the customer. Therefore, in order to persuade the customer to opt for a higher tier, discounts can be offered.
When a customer receives a discount on a higher tier, they are more likely to make the purchase since they get higher value at a lower average cost. Since the average cost is reduced, they are able to understand the lack of value in a lower tier item relative to the higher tier.
A time-bound offer is a great tactic to convince customers to make a purchase. When there is a sense of urgency, customers are likely to feel that such an opportunity would not strike again. Therefore, the desire for a higher-tier product automatically increases.
A sense of urgency also prevents customers from abandoning carts, and the tactic is more likely to result in success.
Three ways to Cross-Sell Products
Bundling is one of the most common cross-selling tactics. Creating bundles of products that complement each other or add utility to each other, is a great way to persuade the customer to make the additional purchase.
When bundles are created, customers are able to experience the lack of utility that a standalone item would bring. Further, they are also likely to consider the added expense and effort of making an additional purchase at a later date. The greatest benefit of bundles for customers, however, comes from reducing the complexity in decision making when picking from several options.
2. Add-on services
A big part of cross-selling is to educate customers about the benefits of purchasing items together. When customers understand the importance of complementary purchases, a cross-sell recommendation can be more successful. We can grab the consumer’s attention by giving them add-on services when they buy more products. Apparel brands can offer entire outfits and outfit recommendations with a ‘shop the look’ feature, instead of showcasing just one piece of clothing. Likewise, electronics retailers might offer discounts when a gaming console is purchased along with an additional controller.
3. Visual aids
Visual aids are one of the most impactful strategies for making a sale. For cross-selling items, visual aids allow customers to see how additional products can add utility, convenience, or value to the current purchase. Several marketplaces implement this tactic to cross-sell. For example, a side-by-side comparison of available options helps people see all of the information clearly, and make an informed decision.
When done well, and with a touch of personalization, both cross-selling and upselling can bring immense value to an eCommerce brand. You stand to gain not just better revenues, but also more trust and engagement. And of course, being able to increase the average order value ensures that you generate more revenue against your current marketing spend.