Lead Generation Strategies for Smart Upselling and Cross-Selling
If upselling and cross-selling are not included in your lead generation strategies, now is the time to start thinking about how you sell to your customers. Often used interchangeably, both of these strategies have a similar goal: to increase the average order spend while adding value to customers. Before we share our tips on how to use both of these strategies as part of your lead generation efforts, let’s take a closer look at what each entails.
Simply put, upselling focuses on increasing the value of the purchase, while cross-selling increases the order size. For example, upselling would be offering customers to purchase a baby monitor along with the baby crib in their cart. With this approach, you are suggesting or promoting products in addition to products that are being purchased. Using the baby product analogy, that would be any product or products that can be used in addition to the main product. As many customers would purchase this product naturally, suggesting related products at the right time can be highly effective.
Cross-selling would be offering customers a deal that includes a baby walker as well as a crib. With this approach, you are suggesting products that can be purchased in addition to the main product. Another example would be suggesting conditioner when the shampoo is purchased. Once again, this comes to knowing which products would be purchased together and suggesting the additional product to customers.
Essentially, the difference comes down to expanding the overall value of the order or purchasing additional related products. The difference between the two may be small, but both essentially increase the value or size of the order while adding value to customers.
How do you know which strategy to use? This can be confusing. A fair bit of subtly is required, too. You certainly do not want to frustrate customers with too many suggestions. If they have already made a purchased or added their products to the cart, they have converted, which is great news. What you need to do here is very subtly make a few careful suggestions that will add genuine value. You will not always get many opportunities to upsell or cross-sell, so you want to choose your approach very carefully to ensure that you get results when you get this opportunity.
Upselling is generally more effective than cross-selling, which makes sense. Shoppers know what they want most of the time, and do not like being distracted by other products. If you are able to suggest something that makes their purchase even more worthwhile, they are likely to at least consider adding on to their order. At other times, however, upselling is not a viable option. Cross-selling may still be a possibility, though. Cross-selling suggestions can help to increase the value of the order in more ways than one, adding more benefit to the customer. If they are already shopping for shampoo, for example, you could suggest similar hair-care products in the same range.
What this means is that you need to offer to upsell and cross-sell suggestions that genuinely add value. Randomly trying to push products and services onto customers without any sort of plan is for all effects the same as spamming them with things they do not need. This is no good for anyone – especially your brand. To use this strategy as part of your broader lead generation strategy, you will need to target customers at the right time, with the right message and the right offer.
Using Upselling and Cross-Selling in Lead Generation
Now that we’ve explained a bit about how each works, how do you go about including this approach in your lead generation strategy? Let’s take a look.
Set clear goals.
What is your primary goal here? Are you trying to increase the average order size, promote related products, add-on services, or increase sales in general? Starting with clear goals is the only way to ensure that you proceed in a way that delivers results. Without clearly defined goals, you will not be able to plan your lead funnel in a way that makes the best use of these strategies. Don’t rely on guesswork, either. Use historical data to determine the areas you most need to focus on in your sales.
Know your audience.
Just like with any other lead nurturing strategy, you will need a clear understanding of your audience. You can use market segmentation along with your sales data to create customer profiles that include pain points, roles, needs and stage in their buying journey. You likely already have this information from your lead generation efforts, which should simplify this step quite a bit. Essentially what you are defining here is what your customers want. This will help you know how best to sell to them in a way that ensures results.
Determine the customer journey.
Every customer has their own journey that will depend on the size of their order, the type of products they purchase, and where they currently are on their journey. You may have once-off customers, brand new customers, those who have abandoned their carts, and those who have returned again and again. Each of those journeys requires a slightly different approach. You could send out an upsell or cross-sell email to a regular customer who has ordered before, but you may not find that a brand new customer will respond in the same way. Likewise, the customer who has not completed their first order yet may not be ready for any selling strategy. Your customers need to be at a stage that means that they know your brand, they have developed a fair amount of trust, and have had enough time to be ready for further sales opportunities.
Segment your customers.
You can also use segmentation to separate your biggest selling segments from those with a lower lifetime value potential. There is little point trying to upsell or cross-sell to customers who have a very low spend and value, especially if those customers typically have small order sizes. Once you have identified the segments that are most likely to convert, you can then put your energy into creating highly targeted emails that offer further selling opportunities. This will save you time and money in the long run. It will also have you focus on the segments most likely to purchase further products.
From there, you can begin planning targeted emails that use automated suggestions or more structured pitches to match products and customers. Through tailored lead nurturing campaigns, both upselling and cross-selling offer many unique benefits. If you’d like help planning your lead generation strategies and increasing your selling opportunities, get in touch with the Grapevine team today.