Proven to be a killer marketing strategy for E-commerce stores, Upselling & Cross-Selling are two pillars for getting a strong consumer reaction that ends up giving a profitable outcome.
Both of them differ from each other.
That’s what this post is all about. If You run a decently large E-commerce store or even if you sell products on a small scale, you can implement these strategies to leverage your income and profit as well.
Let’s recall a thing or two.
How many times have you visited an online store for making a purchase?
Probably a hundred times.
Whenever you click on a product to know more, you are shown a relatively higher-priced product that is much similar to what you are looking at anywhere on the page.
That is known as Upselling.
Now try to remember, every time you viewed a particular product, did you see any related product at the bottom of the page?
These are basically some similar and assisting products that are helpful when purchased with the original product you are looking at.
Needless to say, That is known as Cross-selling.
If you ever used the Woocommerce plugin for creating and managing a store, you might have seen both of these terms, Every time you create a new product, Woocommerce asks you to enter the name of products you want to upsell as well as cross-sell with the original product.
When we dig in deeper, we can define them as:
When a higher-priced or high-ticket product is pursued to sell to a customer purchasing a low priced product in the same category, then it is known as upselling.
In this case, the buyer has to choose between two products, The one which he is looking at (low priced) and the one which is being offered (high-ticket, Costly)
For example, when a person buying a $100 T-shirt is shown a similar T-shirt which is priced at $200, we call it an upsell. That can be seen whenever you purchase some products that are usually priced at less in a discount season. In this case, you have two options.
The first one is to choose the lower-priced product, and the second one is to choose the higher-priced product.
Much similar to the situation when a person has an option of purchasing the fries with burgers in Mcdonalds, Cross-selling means selling complementary and assisting helpful products to customers with an original product. The buyer can buy the other product(s) offered along with the first product he is looking at.
For example, When you look at a T-shirt, the store may offer you to buy denim or a pair of shoes with it. In this case, you can choose to purchase both products at the same time because you are given an accessory which is not a replacement for the primary outcome.
How E-Commerce Stores Do Strategic Upselling & Cross-Selling
For Instance, let’s check out how Amazon upsells its newly launched echo speakers range.
Look at this image, here when you click on the primary Echo Dot speaker which is priced at $39.99, you are followed by a header that shows you the other generations as well.
Here, when I clicked on Echo Dot, Amazon notifies me to consider Echo speaker or the Echo Plus speakers who have more features and are, of course, priced higher.
Amazon’s alexa line-up is an intelligent example of how Upselling works.
Next, to learn more about how Cross-selling works, we would have to check out another product on Amazon, but this time, it would be a lifestyle product rather than a digital one.
Here in this image, you can see a women’s’ top, which has a small box just below the specifications and details are on the page.
When you observe a little bit, you get to know the way of amazon’s cross-sell technique. Most of the women would love to buy fashionable accessories along with a tee or denim.
So, by showing them with the trending accessories, Amazon can sell more products with ease without compromising its user experience and trust.
This can be seen in the recommendation section, as well.
When you look forward to purchasing a refrigerator online, you can see a much similar product being recommended like a voltage stabilizer or a kitchen appliance such as microwave.
Amazon beautifully displays an “add both to cart” button and checkbox to make it easier for you to consider buying both of them.
That’s one of the many ways online stores cross-sells.
It’s obviously not about generating profit that a store tries to cross-sell a product, It’s necessary and helpful as well.
If you are purchasing a Refrigerator, it is a better decision to consider buying a voltage stabilizer as well.
So, by cross-selling a product, you are actually giving more benefit rather than raising profits.
For mutual benefit, Make sure you are implementing cross-selling rather than Upselling.
The Best Practices
Upselling is in general considered for raising maximum profits from an opportunity. How?
In a case where a customer is going to purchase a $100 worth of product will be shown a $150. In this situation, there may be a positive reaction from the customer. However, the odds are on the customers’ side.
Cross-Selling is based on giving maximum benefit to both sides. As a consumer, you would not hesitate when someone would offer you a pair of sneakers with denim. There will be a higher percentage of odds in favor of the seller.
Both of them are equally important for business and e-commerce.
Using each of them for a particular product is Non-sense. You should pick out specific products that are the perfect fit for Upselling and cross-selling respectively.
Since there is a better marginal scale of profit and consumer action in Cross-Selling, it’s more beneficial to implement.
There may be a case where upsell will work better than cross-selling.
If your company has a structure much similar to an MLM, you may know quite well there’s no way you can not cross-sell a thing.
If you have multi-tier subscription-based products such as courses, The upselling will works pretty well.
You can try out both of the strategies for your business. Upselling and cross-selling are two different things and work very differently.
If you think your customers are enthusiasts, collectors and more flourished, the Upselling strategy is definitely going to work for you.
However, if you are focusing on products for the “casual’ side of generation such as teens, the cross-selling would be more effective for you.
In the next article, I’ll cover what is down selling so make sure you subscribe here.
Let me know your questions in the comments.