What kinds of cross- and upselling do you know?

Graphic: Kudelka Cartoons

At yesterday’s ECC-Forum in Cologne, I heard that a good third of all sales on Amazon are triggered by product recommendations. Also according to Forrester, recommendations are responsible for an average of 10-30 percent of shop turnover. They can also raise the customer lifetime value (LTV), average order value (AOV), turnover, profit, and the number of leads.

High time to call the advantages of cross- and up-selling up from the memory banks again:

Cross- and up-selling – what options are there?

  • Up-selling: The buyer is encouraged to reach for an higher priced alternative to the desired product (e.g. a better smartphone)
  • Cross-selling: Products which match/complement the product are recommended to the buyer. These products can come from different product categories (e.g. headphones for the smartphone)
  • Add-on services: It is also possible to offer matching services, guarantees, and product training (e.g. an extended warranty for the smartphone)
  • Product bundles: Multiple complementary products are offered at a slightly lower price as a set. This creates an incentives to purchase multiple products (e.g. Smartphone + headphones + matching case)

Why do cross- and up-selling work?

We love to cover our backs, which is why the “just in case” mentality is a big trigger for purchase decisions. But the approach here shouldn’t be across the board. For instance, even when product bundles are offered, customers still like the have the option of the individual products.

On top of this, the classic mechanisms from price physiology come into play. A much worse option, or a more expensive product in the customer’s field of vision make the product, which you are trying to sell, immediately look much better / more affordable.
But be careful: those who maintain their up-selling products manually, you can’t scale. Automation with digital marketing software or a solution integrated into the shop system is essential.

E-Commerce Upselling Cross-Selling Infografik

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