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Get more out of your existing customer relationships with the right upselling strategy. Up-selling works even better than cross-selling. In this article, we explain how to upsell successfully without coming across as pushy.

What does upselling actually mean? The aim of upselling is to offer customers a higher-priced version of the product they were originally interested in. The more expensive product is, of course, of higher quality. This could for example be a premium version of the original offering or a package of add-ons to the product.

An example of up-selling would be iPhones with their different sized memory slots. For instance, you can get the iPhone 11 with 64GB for 489 Dollars. For 50 Dollars more you get the version with twice the storage space. Up-selling can be found in all industries. Other cases would be when Audi offers you everything from the A1 to the A8, or when you go to McDonald’s and get the double cheeseburger instead of the cheeseburger.

Iphone Upselling
Up-Selling at Apple

Up-selling is often mentioned in connection with cross-selling. Many also confuse the terms. But there is a difference: up-selling is about offering the same product in a higher-quality version. Cross-selling is about selling other, different products in addition to the original product. You can often recognize cross-selling by ads like “Whoever bought this product was often interested in this product XY.” To stick with the McDonalds example, cross-selling would be if you stick with the regular cheeseburger instead of the double cheeseburger, but order a side of fries with it. If you are also interested in cross-selling, our article “Cross-selling: These are the 6 underestimated tips” might help you out.

Cross vs UpSelling
The difference between Up-Selling and Cross-Selling

Statistically, up-selling works up to 20 times better than cross-selling. This is mainly because customers have already said “yes” to the product when upselling. Offering them a slightly modified and optimized version of the same product is no longer such a big leap. With cross-selling, the hurdle is somewhat greater, since you have to convince the customer of another product.

Table of Contents

Welche Vorteile bringt mir Up-Selling?

With upselling, the obvious advantage is the increase in sales while the number of customers remains the same. You get more out of the sales potential of each customer. And all this without incurring any costs for new customer acquisition.

Since you hopefully also create added value for the customer with the premium version of the original product, you also strengthen customer relationships and loyalties and can hope for more recommendations. In the case of prestige products, such as certain cars or expensive watches, your upselling options are particularly pleasing to the customer. Some products are so-called Giffen goods. Here the demand even increases when the prices rise.

How do I time the up-sell correctly?

In upselling, timing is often critical. If you miss the customer’s buying signals, you may miss your chance. Bringing more expensive offers into play too early can be pushy and even dissuade customers from buying the original product. Depending on the product and the customer, you can upsell throughout the entire customer journey.

Even before the purchase you can align your product range or your online store in such a way that the most expensive offers are in the foreground. This makes other offers look cheaper and possibly opens the customer directly to higher price ranges than originally intended. Take a look at what the so-called anchoring bias is all about.

Right at the point of purchase is often the ideal moment for upselling. This is when the customer has made the decision to buy and has let down their guard about spending money. Even some time after the purchase, offers can often be made. Examples of up-selling after the decision for the product would be cheap or even free trial periods or trial subscriptions. Think for example of trial months with the online editions of many newspapers or software providers. At Business Insider, for i, you get instance, you get the first month cheaper before you pay the normal price.

Business Insider Up Selling
Upselling after the purchase is made

Up-Selling Tips

The most important thing to remember when upselling is that the added value for the customer must be in the focus. If the product is of no use to the customers, they will either not buy it at all, or if they do buy it, they will be disappointed with your brand and never come back. Some other basics are obvious and should be considered in both up-selling and cross-selling:

  • Don’t be pushy: you are being pushy when you make too many offers, too often. When upselling, keep it to one or two attempts per purchase.
  • Make it easy for the customer: reduce the number of clicks needed to complete the purchase. For example, make sure that no one has to repeatedly type in their credit card data for different purchases in your online store.
  • Work with “social proof”: With slogans like “60% percent of customers who bought product X later also got the premium version” you show shoppers that they are not alone in their decision to buy your product.
  • Encourage additional purchases with incentives: give customers who make an up-sell a small bonus for doing so. Offer free shipping on purchases over a certain price, for instance.

In our cross-selling article you will find more tips that also apply to up-selling. Here are 5 tips not everyone is aware of, especially for upselling:

Sell the Difference

Advertise only the difference in price between your basic product and the up-sell. Let’s consider a business trip as an example; the traveler needs to get from place A to place B. The standard train ticket costs 100 Euros. At this price the customer has already said “yes”.  If the 1st class tickets cost 130 euros, the railroad could advertise its 1st class tickets with “1st class for only 30 euros”. 

Upsell only your best products

Don’t include your entire product line in up-sell marketing. Focus on the best-selling and highest-rated products. If you charge high prices, you should be sure that customers will be satisfied in the end.

Transparent price breakdowns

When you offer your premium product next to the standard version, you should of course not just show the higher price next to the product. A list of all the features that the up-sell product has in addition is also required. The best way to do this is often with a clearly laid out table. This way, customers can clearly understand what they’re paying more for.

github pricing table
At GitHub customers know exactly what they are paying extra for.

Avoid excessive price jumps

If a client is interested in the 500 Euro product, don’t offer them the 1000 Euro product directly, of course. The rule of thumb here is that the up-sell offers should not include more than 50% of the original price. So in the example at most 750 euros.

The ideal case is that you have a whole range of up-selling products. You then set the prices in such a way that the surcharge becomes smaller with each higher-value product. For example, the customer only jumps from the 500 Euro cell phone with 50GB of storage space to the 600 Euro cell phone with 100GB. Your next higher offer would then be the 700 euro smartphone with 200GB of storage. This way, some customers might climb a few more rungs on your up-selling ladder.

Up-selling into subscriptions

Maybe you don’t have premium versions for your products yet, or you’ve already exhausted all the potential for improvement. For other products, there may be no conceivable upselling options in general. In these cases, you can still upsell by offering subscriptions. Many products need long-term care or are replaced over and over again. For example, if you order contact lenses from Binder, you will be offered a subscription with monthly contact lens deliveries. Subscriptions are often even the most profitable upsells because they bring in long-term revenue.

Summarized

Up-selling increases your average order value (AOV). Without having to acquire new customers, you increase your sales. Important is not to be pushy with too many or too high offers. Promote the difference between the original and the up-selling product and avoid too big price jumps between the offers. Always be transparent and show the customer what exactly they are paying more for. This way you ensure the added value for the customer and thus his satisfaction with your company.

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André Wehr

André Wehr

About Me

As a founder and entrepreneur, I witness the importance of customer centricity for companies on a daily basis.

Incorporate the essential perspective of the customer into your product genesis and marketing processes. That puts horsepower on the road and keeps your business running.

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