You’ve probably heard about upselling before. Heck someone has probably tried upselling you something. Here we’ll explain this sales technique and what’s it all about…
What is upselling?
Upselling is a sales technique whereby a seller induces the customer to purchase more expensive items, upgrades or other add-ons in an attempt to make a more profitable sale. Usually, it involves marketing more profitable services or products but can also be used for exposing the customer to other options that were perhaps not considered previously.
Why sellers use it?
Aside from potentially increasing the value of sale, sellers could also use it to offer something that is more profitable or otherwise preferable for the seller instead of, or in addition to, the original sale. According to one study, it is 70% easier to get an additional 3% in sales from an existing customer than it is to get more customers in the door to equal the same dollar volume in sales.
What about cross-selling?
It’s a different technique in which the seller tries to sell something else (rather than an add-on to selected product or service). In practice, large businesses usually combine upselling and cross-selling techniques. In doing so, the organization must ensure that the relationship with the client is not disrupted.
Are there any examples?
There is a ton of them and we’re sure you’ve probably experienced upselling in some form on your skin. For instance, the seller could:
- suggest a premium brand of alcohol when a brand is not specified by a customer
- sell an extended service contract for an appliance
- suggest purchase of more RAM or a larger hard drive when servicing a computer
- sell luxury finishing on a vehicle
- suggest purchasing of a more extensive car wash package
- ask the customer to super size a meal at a fast food restaurant
- sell the waterproofing spray with leather shoes
While it sounds easy, upselling is also a very delicate technique. Care must be taken to thoroughly train employees as a poorly trained employee can let slip the incentive program and thus offend a regular and loyal customer…
At the end, we want to recommend you a resource that could help you further understand sales (and upselling). One good resource we’ve found is called The Sales Expose; it goes beyond sales to also include business-building information. It’s a result of one guy’s lifetime experience of building his own sales career and business. Check it out.