Upselling strategies to make customers happy – and put more money in your pocket
Upselling without coming across as pushy or sleazy is a delicate balance to strike. However, it’s a great way for businesses to increase their revenue, customer retention and customer loyalty. When many of us think of upselling, we imagine the stereotypical used car salesman that shows us a car way outside of our budget. How do you strike a balance?
Selling to existing customers is more cost-effective than generating new business – it’s 68% more expensive to earn $1 from a new customer than upselling to an existing customer.
Upselling can be mutually beneficial for your business and your customers if you follow the strategies outlined below.
Provide valuable upsells
This seems like common sense, but we wouldn’t be wary of the word “upselling” if all businesses followed this rule. The main reason we find upselling pushy is when we feel that it’s not actually valuable. Your customers will be turned off by upsells that they don’t perceive as valuable.
Make sure that you are providing real value when you try to upsell an existing customer by:
- Aligning their needs with the products or services you’re offering – don’t offer an upgrade that is completely unrelated to products that the customer has shown interest in before.
- Finding customers that could significantly benefit from additional value – sometimes customers don’t need extra products or services from you because they’re doing just fine with what they have. That’s okay! Not everyone will benefit from upsells 100% of the time.
- Customizing upsell offerings when possible – if you can work with your client on a custom solution to their problems, that will be a much more valuable upsell.
- Offering upsells that feel seamless – finding ways to integrate upsells or upgrades into the customer’s experience will make additional purchases feel less jarring and more pleasant. If you can build in opportunities to upgrade in your existing customer experience, you should see better results.
Never try to upsell an angry customer
Another common-sense tip that many companies seem to ignore. Upselling should only be done with customers that are currently satisfied with your business, or at the very least not actively angry with the company. Sometimes, business try to solve customer complaints by suggesting upgrades or upsells that might solve the problem.
Address the customer complaint and try to satisfy their needs without asking for more money before resorting to an upsell strategy.
On the flipside, upselling during the customer support experience can be a great way to offer relevant value to customers who you’ve just helped and are feeling warm and fuzzy towards your business. An American Express survey found that 75% of customers spent more with a company based on a history of positive customer service experiences.
This might be the most important tip to remember when upselling. Hidden fees are the most egregious type of sneaky upselling and they are universally hated – so much so that companies advertise that they don’t charge hidden fees in order to differentiate themselves from competitors.
It can also be tempting to inflate the value of the upsell to try and make the sale, which will hurt you in the long run. When the customer discovers the upgraded product or service doesn’t provide the value you promised, you could lose them as a customer forever.
Upselling doesn’t have to be sleazy. If you are offering honest, transparent value to the right customers, you can increase their loyalty to your business down the road. To learn more about customer loyalty, read our blog on building a loyalty program for small businesses.