Up, down & cross

Among the many techniques designed to increase sales in this article we focus in particular on Up Selling, Down Selling and Cross Selling that come into the scene when the customer has already made the decision to buy and for this reason he might be inclined to spend more than budgeted. So we know these techniques, trying to better understand their meaning through concrete examples and useful tips for your business.

It’s called Up selling when you offer a customer a good or service more complex than the one initially chosen. An upgrade of the chosen option is proposed: the most classic example to understand this operation well, in the context of the product market, is the extra menu of McDonalds, Burger King and other fast food chains. In the world of business services, instead, we use the formula of service levels or membership: a greater investment guarantees the user more functions or a better service than those who choose the basic formula.
With up selling we therefore encourage customers to buy a product that has a higher value. To make the most of this technique, keep in mind that its purpose is to increase the profitability of the customer by increasing its share of purchases in the reference category.

When to apply it? This action is advantageous when the customer is close to the time of purchase or does not know precisely what he wants while the commercial knows what can be of help, knows well the profile of the person in front (or the behavior of the web user) and has a product that costs more or offers more advanced features.

Cross selling instead means offering the customer a product of a different category from that of the original purchase program, often complementary or functional. Keeping the example of fast food, after the choice of a burger we are also offered fries. Another effective example would be to sell a discounted video game with the console, or an extension of the warranty for the expense of a new appliance.
This technique is not only applicable in the physical market, but also in the world of e-commerce, just think of Amazon: every time we put a product in the cart, we are suggested other related items.

In this case the cross selling can be applied before the payment, physical or digital, of the order (then in the cart or checkout). If your company is a single product, don’t be alarmed! Expand your offer with products and services from other companies, in line with your business, through strategic agreements or business collaborations. But be careful which products you approach to yours, always keep in mind what your core business is and find the right allies.

Sometimes a sale may not go through because what we are selling to our customer does not coincide with its real economic possibilities. Here comes into play the opposite technique to up-selling, or down. It can prove to be a winning strategy, when the seller shows an alternative product, but valid and that falls within the possibilities of the prospect. The down-selling is very often exploited in the automotive market: often the customer wants a car, maybe with many options and accessories, but it is out of their budget. The seller, in this case, instead of losing the negotiation, can exploit this technique by proposing a less expensive model or removing accessories to lower the total price of the car.

This action could also be great for starting the loyalty process with new customers. Entry-level products, in fact, can help you to generate a link with the brand, all the more so when a customer cannot afford premium products. Keep in mind even when the customer is very doubtful or held back by some purchasing conditions, such as a high initial investment or the high number of instalments. The ideal, in this case, is to find an alternative solution, which leads the customer to accept and close the negotiation.

After illustrating the various techniques, the question will arise: “which one should I choose for my business?” “Which is the most effective?”.

All right, let’s get some clarity.
According to a research by Predictive Intent, if you sell a product, up-selling works 20 times better than cross selling. In this case, up-selling brings more than 4% of online sales against only 0.2% of sales generated by second tactics. Instead, cross selling has proven to be much more effective on payment pages, that is, when the user has already decided the purchase clearly and is ready to pay for it. In this situation cross selling can increase sales by 3%!

Now you just have to analyze the behavior of your prospects during the payment phase, study your products and their correlation to understand what strategy can find a profitable application in your business.