Sales Training: Effective Up-Selling of Your Products or Services.
Here, we’re going to focus on the art of up-selling – the how to’s, tactics and influence factors as well as up-selling training tips so your sales team can increase the average order size when selling.
Let’s begin with why up-selling, or cross-selling, is so vital in the sales process. These two approaches have actually been referred to by marketing experts as arts and sciences…the way in which they introduce customers to better or complimentary products in addition to what they are currently interested in. Can you remember a time before Internet sales when certain fast food establishments would ask, “Would you like fries with that?” Indeed, offline businesses have been doing this for decades, and there’s a lot of advantages for both the customer and merchant.
Here’s an eye-opening statistic: According to one Forrester research analyst, product recommendation tactics such as up-sells and cross-sells are responsible for an average of 10 to 30-percent of e-commerce revenues.
Don’t you think it’s about time you incorporated effective up-selling into your sales training?
Whether you’re selling a product or service in a B2B or B2C capacity, it doesn’t matter – this blog will help you up-sell more and increase the average order size…which is ALWAYS a good thing.
1. How to Use Up-Selling as a Strategy.
Let’s assume for a moment that you have a sales process you follow (and you should) that, on average, takes about 30 to 40 minutes in order to close the deal. But consider the following: You need to have an up-sell strategy at this point, starting with mentioning things early on in the sales process. For example: If you find yourself engaged in a six-step sales process, perhaps somewhere around the 15-minute mark you can drop hints to the customer about what he or she may want to consider; this can be as simple of a routine as mentioning, “Based on what you’ve told me so far, I strongly recommend you buy – or consider looking at….” (you fill in the blank here). What you’ve done is introduced a concern the customer should be thinking about, but you’ve introduced it early on in the sales process. So, in summary:
• Mention the up-sell possibility early.
• From an authoritative position mention you “strongly recommend, based on what (the customer) told me, that (the customer) also consider this.”
• Give the customer a reason (“Here’s why you should consider upgrading to…”).
• Back this up with verifiable data.
2. Up-Selling Tactics.
It’s a fact that if given two prices during an “accessory sell,” a consumer is going to pick the lower one to mitigate their risk, as they’re not sure if they will use all the features, et al. Now, let’s say that you, of course, want them to buy the more expensive product…you want to influence them to buy that more expensive item. What you could do is emphasize the features, the benefits, the advantages – or you can do something that’s simple: Add a third option, which now creates three price points for the consumer to choose from.
By adding a premium product with a premium price, you systematically get the buyer to select the MIDDLE product and its now middle-positioned price – what you’ve done in this process, however, is make the buyer select your originally higher-priced option because you’ve “bookended” the selections with a third, more premium-priced item.
But what’s the psychology behind this? Why are we mentioning this as a primary up-selling tactic? It has to do with buyer’s regret – a feeling the consumer experiences if he or she doesn’t buy the “right” product. And we’ve all been there after purchasing something, wondering if we should have bought the alternative we were considering. Customers taking a look at your three-price-tier approach we covered in the previous paragraphs will almost always gravitate towards that middle-priced item after considering the low and high end.
Still not convinced? Go to any popular fast food outlet such as Wendy’s, Starbucks or McDonald’s…they always offer three different sizes of beverages: Small, medium and large. This is because they understand the consumer’s thought process which almost always picks the size right in the middle – the “medium.” You should actually use this tactic in your pricing; the next time you are presenting prices to your customers, don’t just offer them two choices because they’ll almost always go for the cheapest one…offer three options, and put your target product in the middle of the pricing strategy via “bookending” it with lower and higher offerings.
Here’s another interesting statistic: On average, when a business adds a premium product to a lineup, 10-percent of the population will always buy that premium product.
Another up-selling tactic has to do with selling more and increasing the average order size by using the power of “Mental Ownership” (or the “Endowment Effect”). When a consumer takes ownership of something, it becomes difficult for him or her to “give it up” (think of a candy-by-the-pound counter where the clerk removes a certain amount of candy from the bag he’s filling because the size went a bit over the “pound” mark; most consumers feel as if they’re being “cheated” a bit with this move). In selling, loading a product with all the options and asking the customer to remove what they don’t need or want is mentally painful.
This sales tactic is effective in increasing the average order size without needing to sell aggressively.
3. The “Foot in the Door” Sales Training Tip.
In the up-selling process, there’s a sales training tip that will be very beneficial for you to pass along to your team. The “Foot in the Door” tactic is a sales technique that gets the client or customer to agree to a SMALL concession (commitment) and then follow-up with a LARGER commitment. In other words, start low and then sell high.
This is a common tactic used by food manufacturers that display sample stands in supermarkets; the consumer will try the sample, and if interested (small commitment) will be told by the representative that the company offers different packages (boxes of the product) at different price points. The rep has gotten the customer to try the sample, and then afterward asks the customer which one he or she would like to purchase; because the customer has made that commitment to the smaller request (the sample), he or she is more likely to make a commitment to the larger request.
Think about your product or service – what can you sell to your customers today that will get them to try something small, yet allow that “foot in the door” to sell something for a longer period of time?
Some Final Thoughts.
While we’re primarily focusing on increased sales and average order size here, it’s important to also consider the experience from the customer’s perspective. A common mistake we see all the time is to offer customers seemingly random products, leaving them more confused. Instead, carefully look at the array of products you offer and think about what makes sense from the customer’s point of view – now, you will be well on your way to increasing revenues by selling more to the same customers while providing them a better, more personalised experience.