Using Upsells to Better Serve Your Customers

As a small business owner or entrepreneur, you are in business to provide your customers with your products and/or services. That also implies that you need to make enough to remain in business. The best way to do that is to develop a thriving business. So, you need to increase your sales and profits. There are four main ways you can do that:

1. Find more prospects
2. Close more of the prospects you have
3. Sell more to each customer
4. Increase prices

Of these approaches, the easiest and least expensive method is to sell more to each prospect. This is where small businesses and entrepreneurs who use relationship selling thrive. You know your customers, their needs, wants, challenges, and interests so you can help them buy. You will suggest things that they will want; though, sometimes, you will need to educate them first as to the value of these additional products and services to them. Regardless, relationship selling means no pressure, no manipulation.

Of course, this supposes that you know your products and services and that you understand your prospects’ needs and wants. The better you know and understand your ideal customers, the more you will describe the upsell in a way they relate to.

Remember, customers come to know, like and trust you based on their experiences and perceptions of your dealings with them. Are you focused first on serving them or do they get the feeling you only care about a sale whether it fits them or not. Offering them extra – related – choices is serving them the same as a restaurant waiter offering coffee and dessert adds to your enjoyment of dining out with them.

Terms Described

Marketers have several terms to describe these add-on sales. The distinctions are not of major importance except to help expand your awareness of your options.

1. Upsell (also known as a “bump” in the beauty salon industry) – this is a sale of your own products that is added to the original sale
2. Cross sell or cross promotion – this is a sale of someone else’s product, like selling Coke with that burger and fries
3. Downsell – A lower priced option or package when they didn’t go with your upsell

The key to these three terms is that they are all ways for your customers to make additional purchases beyond what they just bought. For purposes of this article, when I refer to an upsell, it can apply equally to a cross promotion or downsell.

Owners Think Differently than Buyers

Prospects will often agonize over making the initial purchase, especially if it is a high-ticket item – as opposed to an impulse item. Depending on each customer, “high ticket” can be as low as $100 or even less. Usually, though, it means several hundred to several thousand dollars. They will also negotiate the hardest to get that price down. They will look for every discount or bonus to make it more attractive to invest that amount of money now.

But having made the decision to buy, their mindset shifts to that of owners. Now they want to get the most value from their purchase. They are interested in protecting it, in enhancing it, in prolonging its use, and in enjoying it more. The other thing is, while this purchase is foremost in their minds, this is the ideal time for them to buy the upsell or add-on sale – provided it directly relates to their original purchase. They aren’t distracted by all the other priorities or demands on their resources yet.

4 Examples of upsells and cross sells on the Carnival Miracle

Serve First

To build and maintain a relationship of trust with your customers, serve them by making suggestions that will enhance their purchase in some way.

• Better memories of their cruise because of the excursion they went on or the professional photos worthy of framing or collecting in a photos album
• Gap insurance on that new car to protect against loss in the event of a major accident before the Blue Book value of their car catches up to the remaining loan amount
• A case to protect their new smartphone• Color highlighting while she is in your beauty salon for a haircut
• The crown molding and ceiling fans for their new home construction• That extra shots of caramel for their Frappuccino’s
• The dessert to go with dinner
• The extended warranty and support contract on their new computer
• The audio book to go with their Kindle e-book
• A supplementary course that is expands on the primary one they just sold
• A lifetime membership at a discount when they purchase the one-year membership

Mutual Benefits of Upsells

When deciding on what you can offer as an upsell, focus on your customers first. It will help combat your natural inclination to just push for the additional sales regardless. By thinking of your customers first, you will develop long term relationships and future sales thereby growing their “lifetime value” beyond this first purchase.

The upsells can also improve the customer’s experience sufficiently to greatly increase his satisfaction and loyalty. According to Neil Patel, “Customers who buy more, stay longer. Not only do you earn more profits from superior sales, but you retain customers and combat churn.”

But, like any win-win relationship, you will benefit too. Upsells can add significantly to your profit because

1. Upsell items are normally at a higher margin.2)
2. Your customer is less inclined to negotiate as hard on the upsell having decided to make the major purchase. As an owner of the major purchase, his or her focus is now on protecting, improving, or enjoying the original decision.
3. For most of your customers, the best time for you to get those additional sales is right now, e.g. the add-on sale. Once they leave, they will get busy with their lives then they will usually forget to come back, or they lose their sense of urgency due to some other “urgent” priority.*

*As the upsell done right is something to enhance their appreciation of their purchase, you are doing them a disservice if you fail to at least offer it. Often too, they really wanted the upsell but got so caught up in the major purchase negotiations that they forgot and need you to remind them.

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Conclusion

Thinking of your customers’ needs, wants, interests and challenges gives you, as a small business owner or entrepreneur the opportunity to help your customers know, like and trust you. Relationship selling is about choosing appropriate upsells, cross sells and downsells, which can make your customers happier with their purchases. And that leads to longer lifetime customer values, more sales and greater profits for you.

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Open your heart in selling,

John R. Aberle

Aberle Enterprises

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P.S.

Do you love taking care of your customers and prospects? If you yearn to build more long-term business connections with your customers, get your copy of the Amazon Kindle eBook: 

How Relationship Selling Rewards Small Businesses

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More by John R. Aberle