The upsell is a tried and tested technique to offer your customers products or services of greater value than those they were first interested in. Assuming your business makes a straight percentage on every sale (no matter what it is), the higher priced items you sell, the better it is for your profit figures.
What is Upselling?
Upselling is simply recommending a product or service that is just what the customer originally wanted, but is bigger, better, faster, or more useful.
It’s always the same category and style of product or service, not a complimentary product – so if you work in a pet store, it’s not selling dog food and a dog leash together. It’s selling a bigger and better version of dog food.
Upselling techniques you can adopt:
Upselling techniques work by satisfying the needs of the customer completely – or exceeding them. Where a single scoop of ice cream may have been on the customer’s mind, a double scoop will completely satisfy them.
Your business will most likely sell things that solve a problem for your customers, and to begin with, most customers will aim for the cheapest option that does what they need. For example, if your customer is planning a trip from New York to London, they’ll book a seat on a flight, and that’s that.
That seat could be in the center aisle, in between two people who occupy too much room, with the least comfortable cushion imaginable.
The upsell turns this into a first-class ticket with a reclining individual seat next to a window, in-flight meal, glass of champagne, choice of movie, and so on.
The end result is the same – the customer gets on a plane in New York, flies for several hours, lands in London – but the experience is very different. The need was to travel from one place to another, and both ways ensured this need was met. One way made sure every expectation was met and exceeded.
Now, let us quickly take a look at some upsell techniques you can use for your own business:
1. Pitch a relevant upsell
You need to understand exactly what sort of upselling your customer would need instead of just pushing any old upgrade at them. This is a mistake that many people make.
If a customer is looking to by apples, try selling them sweeter and better quality apples instead of convincing them to buy oranges.
2. Provide consistent value
Most businesses assume that their job is over when the sale has happened. They think they only need to worry about that particular customer again when it’s time for a renewal or a possible upgrade.
It’s fallacy to assume that the customer will be ready to upgrade as soon as you ask them. You need to consistently nurture them, even post-sale. Send them nice newsletters giving them news about your company. This could be product updates, events you are hosting or even discounts that you have going. At the very least, a simple phone call once in a while can go a long way.
3. Identify the customers who have a need
From the very start, use a good tool that lets you know what your lead is interested in. This will help you understand what he wants to buy from you and if there is any way you can sell him a bigger and better version in the future.
Segment such leads into a list and consistently nurture them. This way, you can plan your targets better and set a timeline to pitch the update to them.
4. Help… don’t sell
Always look to add value to the customer. Don’t say “buy a pro plan because it is better”. They are not interested. Instead, tell them how it is better for them or their business by upgrading.
For example, say a person is struggling to meet their health goals. And, he is using your app already to only track their meals and their daily steps. But, you have a higher plan that will give them a customized meal plan and monitor their progress. Tell them, how this plan can help them meet their goals and make their lifestyle healthier.
5. Offer a price discount
Want your customer to buy the better product? try giving them coupon codes or a one time discount. Monetary incentives always work best. This is mostly because the reason they didn’t purchase the higher plan is that they thought it was too expensive.
That doesn’t mean give it away for free but at a reasonable discount. Or club it together with another related service to make it more appealing.
6. Create a feeling of urgency
Give them a time-bound offer. Tell them of how availing the offer in this particular time period could be beneficial to them. Remember to price them wisely and know which products are more likely to get them to purchase.
For example, if you sell an online music subscription, with a free and paid version. You can offer a quick ‘Christmas offer’, where the prices are slashed only for a limited time. This may entice them to subscribe.
7. Check if your customers are happy before upselling
A happy customer= a happy business! But, no matter how hard we try, there will be times when the customer is not so happy with you. Look out for such signs and try to resolve them quickly.
Imagine being really unhappy with a product or service, and instead of fixing it, they ask you to pay more for a higher version. In all likelihood, they would either stop buying from you or worse, contribute to negative word of mouth.
8. Convince them with real-life examples
Show them how people who have used the upgraded version and the problems they have solved. Most of your leads would not take your words seriously. It’s your business, of course, you have only good things to say.
Instead, display the opinions of their peers who are also buying and using the same product/service like them. This will convince them better than anything you have to say.
9. Follow-up constantly
Remember that upselling is still selling. So, don’t let your customer go with just one small pitch. Keep nurturing and following up with them to push them into that upgrade.
Can you sell anything with upselling techniques?
Within reason, yes. The product you are upselling must match the original in the way it provides a solution to the customer’s problem, and the price increase must not be too great as to act as a deterrent if the improvement is not that great.
If you work in an industry selling car tires, for example, your basic price for a set of 4 maybe $100. Your upgraded version offers twice the grip and so is twice as safe, and therefore costs twice as much – $200.
Many customers will go for it, based on the perceived benefit – it is twice as safe. Other won’t because it is a drastic increase in price. If the price for the better version was $150, most customers would be likely to choose that option.
However, don’t forget that you can upsell the upsell. Maybe you have three levels of tires – the original at $100, the improved version (better grip in wet weather) at $150, and the double grip version at $200. You will probably sell very few of the $100 tires in this situation.
Are upselling techniques ethical?
Yes, they are. It should never be your intent to deceive your customer or to sell a product that doesn’t do what it claims to do. If you are satisfied that you are being honest and transparent with your customers and that your products and services are as good as they claim to be, there is no issue with offering these items as upsells.
An upsell should always be better than or outperform the original item or service that was offered. Otherwise, there will be no incentive for your customer to choose the upgraded option and they will remain with their first choice.
If your customer can afford the cost and wants the best solution, then they will choose the upsold items. If they can’t afford them or truly just want the cheapest option, they won’t go for it. It simply isn’t a matter of ethics at all.
Upselling works because people want the best
When affordability isn’t a problem, the main objection to being faced with upselling is that it isn’t the cheapest option. However, given the choice, people will normally pick the more reliable, better quality, or higher specification option when it is available.
This is because it will work better, last longer, or give a greater sense of prestige. The extra cost is worth it to the customer as they get the product or service they need, but at a level, they actually wanted rather than just solving their problem in a utilitarian way.
Think of the automotive industry. When you buy a car, you just need to be able to drive from one place to another. The upsell gives you options of air conditioning, a more powerful engine, or even just a different color of the paintwork.
None of these things are necessary but will make your drive safer, faster, or more enjoyable. Paying that little bit extra is worth it for the satisfaction it brings to the customer.
Upselling works in any industry as you are simply offering more of what the customer wants. They themselves have already identified what they consider to be the solution to their problems, you are simply providing a better solution than the one that already exists.
How can I upsell in my business?
Many businesses will already be set up to upsell easily. Perhaps you provide a silver and gold service – you’re already doing it.
But if not, start looking at the products or services you sell and see how you can change it up. You might find that you even need to go the other way, as what you have is already the gold package. Design a silver package to sell with the least resistance, and then upsell to the gold, as it may be easier than selling the gold from the very beginning.
Your strategy should be based on solving the problem that your customer has, as the better you can solve their problems, the more likely they are to buy from you.