Cross-selling and Up-selling: The Ultimate Guide to Driving Sales

If your online business has not started up-selling and cross-selling yet, you might be leaving money on the table. 

72% of salespeople who upsell and 74% who cross-sell say that it drives up to 30% of their revenue, says Hubspot. 

Upselling and cross-selling have been around among eCommerce sellers. The art of these two tactics is that they entice customers to spend more without using any hard sell. Instead, they offer persuasive, customer-centric suggestions.

While both aim to boost revenue and enhance customer experiences, they do have some slight differences. If you are an online seller and feel a bit unsure about which strategies would work best for your business, this article is here to help. We will guide you through all of the upselling and cross-selling parts. 

What is Upselling?

Definition

Upselling is a sales method that suggests customers purchase a more expensive, upgraded, or premium version of a product or service they already own or are interested in. 

The higher-tier option offers more features, extra functionalities, or add-on benefits that better meet customers' needs compared to their initial choice and then persuades them to purchase the more expensive one. The goal is to increase the average value per sale, consequently boosting the overall revenue. 

Example

Here is a realistic example of how the Shopify store, Dollar Shave Club, upsells their products - razors. On the product page, right underneath the primary product, they pitch two other shave kits with more items added, including razor covers and razor stands. The customers may not have initially considered these extras, but the package deals give them a sense of desire and convenience and potentially lead to a costly final purchase.

In this case, they use product bundles - one of the most common sales techniques in upselling.

Dollar Shave Club’s product page displays primary products and other upgraded kits.

What is Cross-selling?

Definition

Cross-selling encourages customers to buy related or complementary products or services based on their current purchase or interest. These options may belong to different categories but will complement the customer's original choice by solving their additional needs and offering a more comprehensive solution. 

By being exposed to relevant suggestions, customers are likely to end up buying more things in which they may have even had no interest before. 

It should be noted that these products are related but do not overlap with the original ones. 

Example

Let's go to Cowboy’s website. When a customer is about to make a payment for a bike, he is recommended some utilities and stylish extras like a phone case, adapter, lock, helmet, etc. The desire for a versatile ride will prompt customers to add these accessories to their carts, and this is how sales keep rolling. 

The Cowboy checkout page suggests customers a selection of accessories for their bike. 

Key Differences between Upselling and Cross-selling

At first glance, these two strategies may seem similar, as both offer additional value with the common goal of increasing revenue and maximizing customer experiences. However, there are some distinct differences in terms of what they aim for and how they should be implemented. Understanding these nuances is essential to cooking up a winning cross-selling and up-selling game for your business.

	Up-selling	Cross-selling
Objective	Increasing the AOV (average order value) and revenue by convincing customers to spend more.	Increasing the number of items added to customers’ carts in a single transaction by persuading them to purchase more.
Approach	Suggesting an upgraded, premium version or add-on package with a more expensive price.	Suggesting additional, supplementary items that complement their original ones.
Customer perception	Customers find upselling a better solution that can provide them with additional value and satisfaction.	Customers find cross-selling a helpful recommendation that enhances their overall experience and provides convenience with a single transaction.
Timing	During the purchase process, or after customers have made a purchase decision and are about to complete a transaction.	At various stages, including the initial purchase, at the checkout, or through post-purchase stages.

Learn more: Everything You Need to Know About Bundle Pricing on Shopify

The Benefits of Up-selling and Cross-selling?

Cross-selling and up-selling can increase sales by 20 percent and profits by 30 percent. And not only numbers. These two tactics bring even more to the table!

Optimize sales revenue

By encouraging customers to purchase higher-priced products or add more items to their carts, both upselling and cross-selling can significantly increase the average sale value, leading to higher revenue per customer.

Enhance customer satisfaction 

When done right, both strategies can be seen as suggestions or recommendations for customers to better address their needs or make the most of your products and services. They give customers a sense of understanding and assistance without being too salesy. 

Opportunity for repeat business

When treated with positive shopping experiences, happy customers are more likely to revisit your store for future purchases and even become your loyal fans. 

The point of sale doesn’t mean an end. It even opens up a door for great potential revenue if you know how to leverage cross-selling and up-selling with your existing customers.

Improve ROI (Return On Investment)

It costs four to five times more to attract a new customer than to retain an existing one. By enhancing the value of your current customer base, cross-selling and up-selling allow you to get a better ROI. 

Cross-selling and up-selling can yield higher conversion rates compared to acquiring new leads through ads. Why? They target customers who are already engaged, which is more likely to motivate them to take action.

Better inventory management

Balancing inventory supply and demand is always a tough nut for online sellers.

By cross-selling and up-selling, your business can make the most of its sales potential by exposing a wider range of your products and services to customers. This can help move the inventory faster, especially for overstocked items.

Cross-selling and up-selling efforts can also help you better map out and optimize inventory management to prevent stockouts, slow-moving inventory, or overstock.  

Gain valuable insights for marketing

By tracking data from cross-selling and up-selling, you can gain valuable insights into user behavior, customer preferences, and demand patterns. This can be utilized to adjust inventory levels, identify trends, and forecast demands. 

How to implement Up-sell and Cross-sell (+ Ideas)

The success of up-selling and cross-selling significantly depends on how you strategically adopt them through the sales pipeline, from triggering needs to encouraging a purchase. 

Let’s explore how you can lure your customers into engaging in impulse buying with our handy guide and suggestions.

How to Upsell?

• During the initial purchase

This is a golden opportunity to showcase your higher-priced or upgraded options to attract customers. To supercharge the upsell option, highlight the premium features and additional benefits that are not available in the basic version.

Also, a bit of a discount can further incentivize customers. 

Versobooks showcases two ebook options and makes the more expensive one stand out with extra value and discounts.

Bundled products and package deals that include original products and extra items are powerful tools that effectively upsell your customers on the idea of getting a more comprehensive solution.

Pro tip: Take care of how your options are showcased on your pages, as the look plays an important role in enticing customers toward a purchase. As the visual matters, we recommend a smart and fast way to design your frontstore - GemPages. No coding skills needed! A stunning upselling design can be effortlessly created using a drag-and-drop editor.

As a top page builder on Shopify, GemPages also offers a vast tailored template library for you to seamlessly design any pages for your online store, not only bundles. 

• After the purchase decision

Once customers have made their initial purchase decision but have not completed the transaction, offer them relevant upsells. Personalized recommendations and conversion-driven pop-ups can help you achieve this.

• Upgrades or renewals

When customers are due for upgrades or renewals, you can offer them upsell options, like sending an email 3-5 days prior to the due date. The content should highlight how the upgraded version can better fulfill their evolving needs or offer a bit of a discount.

Shopify emails users with invitations to trial-to-paid upgrades.

• Follow-up communications

Use various touchpoints to proactively engage with customers post-purchase. This can be through email, newsletters, personalized messages, hotline, etc. The suggestion for upsell options should be relevant and based on their previous purchases or their interactions with your business. 

How to Cross-sell?

• During the initial purchase

Cross-selling should persuade customers to enjoy your products and services to the fullest by offering them related or complementary items. 

For example, if a customer is buying a camera, recommend additional lenses, memory cards, or camera bags.

These suggestions often appear on the homepage or product page with the title: “Frequently bought together”, “People also viewed”, “Also check out”, “People also bought"...

Studioneat cross-sells their products by showcasing related items on their homepage.

• During the checkout process

Let shoppers imagine how accessories, utilities, and other related items can enrich their experience with the product they’ve already chosen. This can be done through on-screen prompts, pop-ups, or personalized suggestions.

The Brosa’s cross-selling pop-up appears when the customer is finalizing their payment.

• Post-purchase communication

Include cross-selling suggestions in purchase or shipment confirmation emails, recommending some related products to complement the customers’ recent purchases. 

It’s important to note that these suggestions should be relevant based on customers’ purchase histories and preferences. Identify cross-selling possibilities and personalized suggestions using data analysis.

• Customer service interactions

Engage with your customers by kindly requesting their feedback or reviews. For example, if a customer reaches out to customer service, asking for more information about products, don’t miss out on the opportunity to recommend additional products. 

Keep in mind that you are an advisor, not a seller, so serve your customers what really fit their specific needs.

Best Practices for Successful Upselling and Cross-selling Campaigns

Be relevant and personalized

Please take note that irrelevant or unrelated products can lead to confusion, annoyance, and, ultimately, a negative experience of your brand.

Upselling and cross-selling are subtle arts that evoke impulse buying needs. It’s all about delivering values that make your customers happy. Customers are more likely to accept relevant and helpful recommendations that are tailored to meet their needs and preferences. 

Learn more: ReConvert Upsell & Cross sell

Pricing

Ensure that the price difference between the initial product and the upsell or cross-sell option is reasonable and appealing enough based on additional value or features. 

You can use some pricing techniques like anchoring, which offers customers a higher-priced product first, then a lower-priced one. The higher price creates a frame of reference or anchor point for the customers’ consideration against later options. 

Create a sense of urgency and an incentive for customers to spend more by offering limited-time discounts. 

Using product bundles

Product bundles are one of the most powerful techniques for upselling and cross-selling. A package deal makes the customers' lives easier as they only need to pay in one go. 

Suggesting instead of selling

An aggressive push can create a negative experience that discourages customers from making a purchase. It’s necessary to take a consultative approach with helpful suggestions to build trust and foster a positive customer experience.

To do that, focus on the values that customers will receive instead of the features that you want to sell. 

Over to you

To get the most out of cross-selling and up-selling, it's important to have a comprehensive understanding of these two techniques regarding targets, approaches, and best practices. By following these ultimate guides, businesses can effectively drive sales growth while fostering a positive customer-business relationship. 

And please take note that the ultimate goal of cross-selling and up-selling is to make your customers as satisfied as possible, and cash flows then come as a bonus for this customer-centric strategy. 

FAQs