Up-selling is a direct marketing practice wherein a salesman tries to tempt a customer into upgrading their purchases or buying add-ons amounting to greater cost and quality. It provides customers with options that they might otherwise not have considered. The salesman simply ups the price of the product by offering better products or services.
Up-selling need not be manipulative. Rather, it should simply be suggestive. Since the customer is already buying a product, he or she is generally "handled with care" by the salesman who tries to super-size the purchase. "Your choice of jacket is excellent, madam. Incidentally, we have the same jacket with fur for just $20 more."
Cross-selling means the sale of additional products to a customer for more business. The term is usually related to selling an item that complements a customer's purchase. Selling a color-coordinated tie and a shirt to go along with a selected suit can be an example of cross-selling.
Businesses that offer more than one product or service often use the cross-selling technique for marketing. Successful bankers always look for opportunities to sell credit cards, insurance, and mutual fund products to their existing account holders.
Cross-selling is also very common with in-bound telemarketing calls. It should be done in a pleasant way and never pressed. Though it may simply sound like a temptation for impulse buying, cross-selling offers legitimate added benefits to shoppers.
Up-Selling and Cross-Selling Effectively
Up-selling and cross-selling are very useful tools to boost sales, especially for small businesses. Some fundamentals required for effective implementation of these techniques include:
Always take a chance. Some vendors are not very comfortable with offering more. What if the customer gets irritated? Surveys show, however, that the majority of buyers appreciate being updated about additional products or services that they might not be aware of and that may be of use to them.
Stick to related products. Selling tennis balls with a racket is fine, but trying to sell weekend clothes with rackets may not really work. Staying relevant is important.
Train staff accordingly. Whether up-selling or cross-selling, the staff should be well trained and have full knowledge about the products in question. Staff members must be able to explain the benefits of buying additional products to customers.
Other factors, such as timing the offer and referring to an expert's recommendation, can be used for marketing additional products.
Both methods of pushing customers to shell out a little more can radically increase your sales. However, focusing one's efforts on client needs, rather than simply pressing to sell more regardless of those needs, is the key to successful up-selling and cross-selling.