Upselling is one of the best ways to edge a little more revenue out of your sales effort, give customers more reasons to be satisfied with your company, and help drive the success of your business. So, if upselling isn’t part of your current sales strategy, now is the perfect time to fold it in.
What is upselling and why does it matter?
Upselling is akin to the famously asked question, “Would you like to add fries to that order?” As part of your sales effort, you encourage your customer to purchase a complementary item to the one they have already decided upon buying.
Overwhelming marketing metrics show that the odds of selling to an existing customer are significantly higher than selling to an unknown prospect. In fact, your chances of making a sale to an existing customer are about 70%, but only 20% for non-customers.
While, of course, a new customer acquisition strategy is essential, upselling efforts to existing customers can increase revenue, increase customer lifetime values and improve the customer.
Preparing to upsell
A key step that many businesses bypass when starting an upselling initiative is laying the proper groundwork. Take an assessment of your current offerings, brainstorm opportunities, and define who you will market to and how you will define success.
Assess your upsell opportunities
Survey your sales team to find out what is working, what the challenges are, and what they see as a path to growth. Work with your team to identify what products or services can you upsell currently. Consider bundles or monthly service packages that you could market in a different fashion for an upsell.
Upselling opportunities may abound in places you have yet to explore. Define those opportunities and keep it simple at the start, adding on as you go on. This can help create your strategy and your baseline to measure success.
Define and segment
Now that you’ve done your due diligence and understand where your upselling efforts are currently, you can build from there. By defining your customer base, you can better target your messaging and product offering to fit the needs of your customer base.
Pro tip: Don’t go crazy with granular segments. Keep the groups at a high level, so it’s manageable. You can always get deeper into segmenting and targeting as time goes on.
Set measurable goals
Be sure to set some measurable goals so you can gain clear insight into your business performance, celebrate wins and adjust when things are not working.
It’s okay to keep your goals basic and modest if you’re uncertain about the way things will go. Once your strategy is set into motion, over time, you may create stronger, different, or more specific goals…but always set those goals and reflect back on them.
Best Practices for Upselling
Understand your customers’ needs and wants
Your upselling effort should help your customers. Make sure that you are tuned into your customers’ challenges and providing a solution.
Define the timing
Every instance is different, but there is a sweet spot for your upselling effort timing that needs to be defined. For some, it may be at the time of the first yes, or for others, it may be after a certain measurable time after the first sale. Variables will change, but defining them is a critical step.
Be transparent with pricing and provide value
Price and budgets are always on the mind of the customer. Be sure to show how your additional service is priced and how that price is worth it.
Monitor the external landscape
Keep an eye on trends in the marketplace and competitive offerings. You can also survey of your customers to learn more about what they want. This effort should be ongoing as customer preferences change over time.
Show social proof
Online reviews and testimonials influence the way that consumers make decisions in our digital world. The more that you can show proof that your upselling initiatives are working for others, the more you may be able to close the deal at hand.
Bring your sales and customer service teams up to speed
Be sure to communicate and train your team to know what to sell, how it’s going to be measured and what tools they have to help them sell. This effort should be ongoing, so the team is empowered to succeed and work in conjunction with the overarching objectives of the business.
At Spring Green, we provide Franchise Owners with on-going business support, that includes proven marketing and sales strategies. Whether you are in the Green Industry and want to diversify or are looking for a turn-key franchise, Spring Green may be the perfect fit for you. Learn more about the Spring Green franchise opportunity.