What is upselling? Well, there are certain terms and questions that invoke a slightly dirty feeling. Upselling — a classic salesperson’s technique — is one of them. However, the reality is it can become a vital part of your aftercare and overall sales strategy.
Of course, your goal should always be to make as much money as you can from sales. As such, presenting more expensive products that can better help the customer is simply a logical action from your point of view.
This piece will look at what is upselling, how it works, and what it takes for a small business to implement it without scaring away your customers. Let’s take a look!
What is upselling?
You’re likely already familiar with the concept of upselling, whether you know the actual term or not. In a nutshell, it’s a method of turning a current customer into an even more profitable one by introducing them to a higher-priced version of their current purchase. Alternatively, you could offer an add-on to their existing purchase.
An example of the former that you’ll have inevitably run into is the classic, “Would you like to go large for an extra two dollars?” spiel given by many food and drink outlets. Of course, the price will vary, as will the size, but the premise is the same.
As we explore what is upselling, let’s look at the add-on approach. Consider a company such as Glasses USA. The initial price includes frames and basic lenses, but once you’ve made a choice, you can spend more to personalize your glasses to your exact requirements:
There’s obviously a clear benefit for you in implementing upselling: greater income and profit. However, there are supplementary advantages, too, such as an increase in customer loyalty. This loyalty also creates a willingness for existing customers to recommend you to others, which obviously has an impact on your future sales.
However, haphazardly jumping into upselling could also have a negative impact. Let’s talk a little more about this now.
A practical approach to upselling for your small business
This is where we take an ethical diversion in answering the what is upselling question. Upselling often has negative connotations, and the two examples above highlight the two schools of thought. On the one hand, being asked if you want to pay for more food is often considered overly salesy, whereas bolting on additional elements to an essential purchase (and paying for the privilege) isn’t.
Upselling should be a key part of your overall sales strategy. However, if you’re purely thinking about profit, you’ll likely cross the ethical line at some stage and customers will notice. Instead, upselling should revolve around one simple question: How can I help my customers better solve their problems?
Thinking along these lines means you have their interests at heart, which can give you the benefits explained in the previous section. Money will always flow to businesses providing good products and quality service, and if handled correctly, upselling becomes almost invisible given the service you’re offering and the approach you take.
How to begin upselling to your customers (without scaring them away)
If you’ve followed along so far, you’re likely well on your way to understanding the right way to go about upselling. This is because by aligning your mindset towards the customer, you’ll have already started using upselling tactics within your business.
For example, you should have already begun identifying customers with greater needs than what their current purchase provides. These customers will not just be prime for upselling to work, they’ll also welcome it. However, if you haven’t found these customers yet, you may need to consider what they’re looking to gain from using your products. From here, it will be much easier to ascertain how to upsell to them.
Related to this, and tied to the philosophy we introduced in the previous section, you’ll want to strip away the idea that you’re offering upgrades or upsells to the customer. Instead, ideas and concepts should be central. For example, a photographer providing a portrait service shouldn’t just talk about spending more on prints. Instead, they should offer a set of 8x10s that can be framed and given as gifts to family members, which also happens to have a cost attached.
Of course, timing when you introduce upselling elements is crucial, and this will depend on your overall offering.
A clear and simple pricing strategy is going to bolster your chances of success here, too.
Finally, make sure that your base or entry-level products or services can deliver immediate benefits to your customers. This is more important than it first appears, as no customer will likely spend more without reaping the rewards first. Once you’ve essentially proven that you can help the customer, it’s much easier to sell them on additional services, or a higher-priced product that can do even more for them.
An ethical downside to conducting business is often that you have to use potentially questionable tactics to earn money. However, as is often the case, how you approach the implementation of them is key not just for success, but for reputation.
Upselling is firmly in that bracket, although used correctly and ethically, you stand to help customers solve their immediate and long-term problems.
If you consider a customer-first approach, rather than the chance to make money, you’ll inevitably bolster your loyal customer base, and profit from your success, too.
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