Up-Selling

Up-selling is a sales technique commonly used by vendors to ingeniously encourage their customers to purchase more expensive items, upgrades, and add-ons in attempt to make a more profitable sale. Up-selling usually involves marketing more profitable services or products but can also be simply exposing the customer to other options that were perhaps not considered previously. For instance, if a customer was looking to purchase a certain product, a salesperson may try to convince you to buy the accessories for it whether you need it or not.  Up-selling implies selling something that is more profitable or otherwise preferable for the seller instead of, or in addition to the original sale. A different technique is cross-selling in which a seller tries to sell something else.

Incentives are crucial features of up-selling. Incentives such as a discount and/or free shipping give the customer good reasons to purchase something extra right away. For example, the "buy one, get one" (BOGO) incentive works well to increase sales in many industries such as fast food and fashion accessories, whether the offer is to get the second item for 50% off or for free. Free shipping is often a good way for web-based retailers, or "e-tailers," to encourage consumers to buy extra items, such as by offering free shipping on all orders that total a certain minimum amount. Or when a customer purchases expensive items such as electronics, you can extend his/her warranty. In addition to offering incentives, pointing out the benefits can also help convince a customer to add more onto their original order.

Effective up-selling techniques should be applied as well. The most effective up-sell technique is offering free product samples or trial service subscription. By offering customers a hands-on experience, they will feel more comfortable about their final buying decisions. Providing free samples is also an excellent way to encourage your customers to recommend friends and family members to your business. Granting customers a test drive of a product or service can be delivered by providing free samples, quotes, or trial memberships.

Many companies teach and encourage their employees to up-sell products and services and offer incentives and bonuses to the most successful personnel. Care must be taken in this type environment to thoroughly train employees. A poorly trained employee can let slip the incentive program and thus offend a regular and loyal customer. There is a level of trust that needs to be established between the customer and employee. Once that trust broken, it may never be reestablished. A common technique for successful up-sellers is becoming aware of a customer's background and budget, allowing the up-sellers to understand better what that particular purchaser might need.

For online vendors, mastering the technique of up-selling potentially increases shopping cart sales by at least 30%.  Recent marketing stats revel that online merchants offering up-sell options increase their chances up to 67% of closing an add-on transaction at the time of purchase or once redirected after the sell has been completed. While the terminology of up-selling is unfamiliar to some online vendors, virtually everyone that has ever purchased an item or service online has been a target of an up-sell. It’s essential to understand the benefits of up-selling in order to significantly increase shopping cart sales. The basic principle of effective up-selling is offering customers a product related to the items dropped in their shopping cart at a discounted price. From a marketing perspective, both customers and merchants benefit from an up-sell.

Merchants who utilize a web presence to launch a specific product or service sometimes fail to realize the potential profits of up-selling.  Others make the attempt to up-sell; however, fall short in their efforts for a variety of reasons.  One common misconception that online merchants have is that implementing up-sell features requires extra resources in order to successfully close a deal; however, the truth is that if items have already been placed in a shopping cart, then the only additional resources required is a few minutes of time to upload up-sell items on the storefront. The reality is that up-selling is a quick and easy concept to apply to e-commerce ventures, yet some online merchants lack the skills to be successful in their up-selling attempts.  The most common cause for defeat is a lack of unconvincing sale pitches, combined with aggressive merchants is a guaranteed recipe for a missed opportunity.

Merchants and salespeople should note to use simple strategies when it comes to up-selling. They shouldn’t offer add-ons or products they wouldn’t consider purchasing for themselves. It’s always important to keep their customers’ needs and interests in mind and what would make them want to add on to their planned order. Doing so almost guarantees a beginning of raking in the profits from up-sell marketing. Many online merchants soon realize that the benefits of up-selling to existing customers outweigh the resources spent in chasing new sale leads. While not every online merchant is successful, those that reap lucrative profits take full advantage of up-selling.