Have you ever walked into a shop to buy one thing and while browsing through the shop, been suggested by the sales person to buy another thing in addition of what you have already bought? We have all been subjected to this practice at one time or another. This practice is called cross-selling.

Definition of Cross-selling

Cross-selling is the technical term used for a marketing strategy that involves presenting or suggesting related products and services to a client who is intending to buy something. It has been found to be one of the most effective strategies for marketing if done properly. Almost all businesses practice cross-sell in some form or the other. Cross-sell should not be confused with upsell, which is a completely different concept.

Difference Between Cross-sell and Upsell

While cross-sell is an attempt to sell another item in addition of the one that the customer is inclined to buy, upsell is an attempt to sell the customer a similar product that is more expensive, or a higher model or version of the item that the customer intends to buy, in an attempt to make him spend more money than was originally intended.

The aim of both upsell and cross-sell is the same to make the customer spend more money than he or she intended.

There is a difference in approach of the sales representative in upselling and cross-selling. In the cross-selling the sales person identifies the need of the customer and then offers additional products that would go on to fulfill the need. In upsell, the sales representative builds a hype around the product to create a value for the customer so that he or she is inclined to buy a more expensive item.

Strategies for Cross-selling

As part of your marketing plan, you have to have clear strategies for cross-selling to work. Some of the best examples of cross-selling can be seen at super markets. Here are some strategies that encourage a customer to buy more than intended, without being too obvious.

  • Provide a Range of Products: It is important to have a number of things that complement each other in order for cross-sell to be effective.
  • Be Careful of Positioning: Where you place an item is very important. If you place low-cost things like mints and snacks around the cash counters, customers are bound to browse and pick up something that they did not intend to buy. Placing complementary products together encourages cross-sell. Placing items that customers normally buy together close to each other also helps.
  • Recommendations and Suggestions: Recommend or suggest products that others may have bought together to a customer. This is especially true of online selling and has been found to be very effective in increasing revenue.
  • Giving Incentives: provide incentives to your customer by having schemes where they can avail benefits if they spend a certain amount. Have a staggered incentive system where the more one spends, the more incentives are available.
  • Deals: bundle up products together in a way to make it beneficial for the customer to buy bundled products and avail discounts. This works best with products that go together like burgers, fries, and cold drinks.
  • Discounts on Buying More Than One: by adding a discount on products, it is easy to push hard to sell articles. Offers like buy 2 get 1 free are the typical example of this type of cross-selling.

Though some cross-selling is good for the bottom line, but too much of it to the wrong customers can cost a lot more to the business than they may have bargained for. It is best to cross-sell with subtlety rather than being too overt or aggressive about it.