What is Upselling? Learn How to Boost Sales Without the Pressure
Author: Rachel Morgan
August 1, 2024
Upselling is more than just a sales tactic - it’s a way to enhance the shopping experience for your customers while also boosting your business’s bottom line. At it’s core, upselling involves encouraging customers to consider a higher-end version of a product or service that they are interested in, to offer them more value that meets their needs, and as a result, it often leads to a better customer experience. It’s a technique that when done tactfully, can make selling feel like a breeze, and not from a place of being pushy or pushing products and services just for the sake of it. You might even hear a customer say “I’m so glad you told me about this!”
WHY UPSELLING MATTERS
Upselling is beneficial for both the customer and the business. For the customer, it can mean a better product or service that meets their needs much more effectively than what they originally planned for. When a customer can walk away feeling more fulfilled and taken care of after an interaction, they’re going to rave about it to everyone they know and surely come back for additional purchases. Why? Because they feel heard, understood, and as if the business had their best interest in mind.
But only if the upselling made sense for their need.
For the business, besides being a fantastic way to encourage repeat business and loyalty, it’s an opportunity to increase the overage order size and overall revenue. When you take the time to discover the customer’s needs and show them options, you’re better able to recommend products and services that make sense, even if it’s not the one they came in for originally.
Picture this. You own a salon and a customer shares that they want to book an appointment with you to cover their gray hairs. Upon booking the appointment, you may take the time to ask a few additional questions such as:
What products do they currently use?
How often do they color their hair?
How many colors do they have currently?
What does maintenance look like
A customer may not be receptive to hearing that they need a different service at this time, but by finding out more additional details, you can help guide your customer to a service that leaves them happy and feeling successful afterwards. Perhaps the right solution for this customer is to incorporate highlights or an overall color to better blend in grey hairs vs just covering the roots. Yet without asking more questions, it can be a challenge to connect the dots for your customer and introduce a different solution that is received (and appreciated).
Upselling can also help you build stronger relationships with customers by showing them options they might not have considered and are much more happy with. It can also position you as an expert creating more trust for what you have to say.
UNDERSTANDING THE DIFFERENCE: UPSELLING VS CROSS-SELLING
You might’ve heard the term cross-selling and felt confused how it relates or is different from upselling. And no, they do not mean the same thing. It’s important to make that distinction and understand how they are both different selling techniques that can lead to a better customer experience while also boosting sales. They are also both great sales skills to practice and develop!
So what is cross-selling?
While upselling focuses on encouraging customers to purchase a higher-end product, cross-selling involves suggesting additional products and services that complement and enhance the original purchase. Think of it like you’re showing items from similar categories that “cross” and work together.
Using our salon example, cross-selling might look like suggesting a shampoo or conditioner that maintains color better, an oil to keep hair healthy, or even a treatment. It all comes down to why someone is purchasing and how you can best meet their needs.
I like to think of cross-selling like this - once the customer leaves your store, what product or service will help them be more successful post-purchase? There’s nothing worse than when a customer leaves and their purchase doesn’t hold up like they expected and are frustrated that nobody explained what to do. In these moments, it doesn’t matter how great the service was during the transaction, it matters more how you set someone up post-transaction.
This is why cross-selling is so useful! Use it as a way to educate the customer, not just to push and move more products.
BENEFITS OF UPSELLLING & CROSS-SELLING
Increased Revenue: The most direct benefit is an increase in the average sale size for the business. Cross-selling and upselling both encourage the customer to spend more, which means you sell more to each customer you work with. This technique is only useful if you suggest items that genuinely make sense to the solution and needs of the customer. Otherwise, you may end up with a lot of returns (which may decrease sales overall) and unhappy customers.
Improved Customer Satisfaction: Customers often appreciate being shown higher-quality options that may better suit their needs. They also often appreciate personalized recommendations to enhance their purchase and compliment their need. It demonstrates active listening and genuine care. This is when you hear statements such as “Wow! What an incredible experience. You HAVE to go see X.” Give them something to consider that they weren’t already.
Stronger Customer Relationships & Retention: By engaging with customers and offering them valuable options, you can build trust and encourage repeat business. Demonstrating why something makes sense to them and then sharing the benefits, builds trust because you position yourself as an expert. Customers don’t know your products and services like you do. Explain to them what they need to know and you’ll start to build a strong customer relationship and see an uptick in retention and repeat business.
Less Buyers Remorse/Returns: We’ve all experienced customer who return post-purchase because they said yes to something they didn’t mean to or spent more on something they didn’t feel confident with afterall. This often stems from suggesting products for the sake of pushing them or their price point, without demonstrating how it benefits them and ensuring it actually meets their need. You don’t want your customer to go home and think, “what did I just buy?” You want them to be excited! Learning and developing upselling and cross-selling skills can help minimize buyers remorse and returns.
Increased Word-of-mouth: Customers who have a good experience want to tell others about it.
Listening attentively to your customer’s needs and concerns shows that you value their input and respect their time. In order to convey this, some additional sales psychology techniques include nodding, summarizing what they’ve shared back to them, and asking several clarifying questions.
Just remember, upselling isn’t just about making a sale - it’s about enhancing the customer’s experience and meeting their needs. By understanding the products and services you sell, listening to your customers, and using the right language, you can effectively sell more and develop a customer experience so good, they’ll want to tell everyone they know.
For more in-depth training and personalized advice, feel free to reach out to me at rachel@rachelmorgancoaching.com and make sure to ask about my next workshop. Visit my website for more articles and tips on improving your sales skills and connect with me on social media at @rachelmorgancoaching for regular updates and insights.
ABOUT THE AUTHOR
With more than 13 years of experience in luxury retail, Rachel now helps luxury retailers with their customer service, training sales teams, and improving sales performance using consultative selling techniques. She currently serves the Greater Seattle area.
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