Boost Sales With These Upselling and Cross-Selling Strategies
Frank Jackson, 07/12/2018,
We’ve talked about how to find new customers in some of our previous blogs. Facebook and Instagram Ads, Google Keywords, and organic growth through customer referrals and social media. You’ve done the hard work of creating those ads (and a SEO strategy!) and you have a steady flow of customers – but how do you make those customers more valuable?
This post will give some tips how to upsell (i.g. for $1.29 more you can make it a large combo) and cross-sell (i.g. you’ll need some sunscreen now that you’ll be outside more with your new pair of sunglasses). Once you’ve successfully implemented these strategies, you’ll see your revenue grow without spending more for new customers.
Why Upsell and Cross-Sell?
What is your budget for advertising? How much time have you spent creating, testing, and modifying those ads? Getting new customers is really hard, and really expensive. Cross-selling and upselling allow you to make more sales (and money!) on customers you already have with minimal investment.
Also, it’s a numbers game. You know your existing customers are interested in your products and believe in what you’re selling. Studies have shown that the probability of selling to a new prospect is between 5% - 20% while the probability of selling to an existing customer is 60% - 70%. I don’t know about you, but we like the 60% - 70% probability better! Here are some key upselling strategies to try.
We know how powerful psychological factors can be when a customer is deciding what to buy, but how can you use them to increase your basket size? Make sure you are tapping into the primal inclination of herd mentality.
The human brain is hardwired to try to streamline decision-making, defaulting to decisions that have been made by many others in the “herd”. You can capitalize on this by adding a “Purchased by Others” section at checkout where you link to other products that you’ve sold. Want to make it even more effective? Show real social media photos of other customers with their products. Pretty soon, everyone will be rushing to buy the same products at your store.
Most of us have been convinced to upgrade to the next size combo at our favorite fast food restaurants (it is only $1!) but how can you do this online? By offering small, less expensive products when a customer is buying a more expensive product the less expensive item suddenly seems more valuable and your customer is more likely to buy it.
For example, a customer might think a $20 sunglasses case is expensive. However, if you are buying a $200 pair of sunglasses that extra $20 for a case to protect them doesn’t sound too bad. You can use popups or sidebars to advertise these small additions but make sure they are relevant.
Know Your Product Lifecycle (and capitalize on it)
We focus a lot on selling an individual product but what happens to that product 6 months down the line? What will your customer likely need? Each customer will likely need something a little different so segment your customer base to ensure that your automated emails are tailored correctly to their recipient.
Let’s take an online clothing store as an example. Did the buyer buy baby clothes? Send an email in a few months offering the next size up. What if the customer bought a t-shirt? It’ll wear out eventually so send a reminder email in 10 – 12 months offering a new, crisp one. How about if your customer bought a tank top in the summer? Send an email in the fall suggesting a hoodie or jacket.
Incentives to Spend More
If your end goal is to increase the value of every purchase – give your customers a reason to want to add more to their cart. Some easy incentives to add: Free shipping on orders over $50, 5% discount if you have more than 3 items in your cart, receive a free $10 gift card for all purchases over $100.
However, make sure you are factoring these discounts into your profitability. We know you want to sell as much stuff as possible, but the end goal is always to make sure you are making money as well!
Targeted Advertising After a Purchase
The above strategies are all for customers who are about to buy something from you, but how do you upsell after a transaction has been completed? Lucky for us, Facebook ads allows you to target specific customers after they buy from you.
Let’s use the sunglasses and case example again. Say your customer bought the $200 pair of sunglasses but nothing else. Maybe you haven’t set up your pop-ups cross-selling the case or the customer just wasn’t ready to spend more than the $200 on the sunglasses. Since you will have your customers email address, you can add this to your Facebook ads manager to create a custom audience of customers that only bought the sunglasses.
You can now target these customers with an ad for the sunglasses case. Maybe they’ve worn the glasses case out and now realize they don’t want to risk breaking them. Your ads are now reminding them of an affordable way to protect their purchase. Pretty cool.
So, there you go. We all know that getting new customers is much more expensive than selling to existing customers so you can now use the above strategies to increase sales and make more money without breaking the bank.