upsell

“For a Dollar More, You Can Get a Large”- Upselling 101

We’ve covered selling in a general sense and gone into detail about cross-selling, the next item on the list is upselling.

With upselling, you’re selling a person a better, more expensive version of whatever they were initially planning on buying. If you’ve ever been to a movie theater or fast food restaurant, you’ve probably experienced upselling in the form of “For a dollar (or so) more, you can get a large.” You were already thinking of getting this meal anyway- the upsell increases the quantity of popcorn you were planning to get, and the movie theater makes more money.

Back to the baby registry example I used in the cross-selling post, Amazon also has a subtle upselling option. You can see “Customers Also Viewed…” which will offer a similar product from different brands at different price points (I say subtle because some options are cheaper and some are more expensive). Another potential upsell on Amazon is the comparison chart that appears with some products. I definitely poured over these, and the reviews, when creating my registry.

Again, just like with the cross-selling example, you can offer upselling options on your own website in a similar way.

General Facts/Tips for Upselling

While the whole concept of “For a dollar more you can get a large” may feel weird or gross to offer customers, it’s been argued that it can actually increase customer loyalty/retention. But how?? You’re just tricking them into spending more money, right? Not really. This article gives an example of upselling a service (car insurance). While the customer was calling their insurance company for a tow truck, the company mentioned “Hey, you’ve been a customer for X number of years and are now eligible to upgrade to a better insurance plan”. Since the person had been a customer for such a long time, and they had to wait for the tow truck anyway, they said “Yeah, why not.”

How does this create customer loyalty/retention? Knowing that you are eligible for greater benefits as time progresses increases the chances someone will stay on as a customer for longer (provided there’s already a value in the service/product). Additionally,  the same article suggests upselling should be a win-win- your customer should feel like they are “winning” (but not in the Charlie Sheen sense).

An example of upselling where the customer doesn’t feel like they are winning: when a cable company tells you you’re eligible for a month long trial for 100 extra channels (yes, please!) but you unknowingly stay signed on and have to pay additional fees the next month. Not cool, don’t do this to people.

How to Upsell

Unlike cross-selling, it’s a little trickier to upsell after the sale has happened (unless the customer decides to return their purchase for something more expensive, which is pretty inconvenient when you think about it).

Here are a few ways you can help make the upsell happen.

Educate your customer.
 Comparison charts, videos, blog posts, and other methods to educate them about the difference between different products/services (and subtle justification of price differences) allows the customer to be open to be upsold.

Be ready to bundle.
If you want to upsell your kayak tour consumers with optional $10 Otterbox rental and $15 gourmet lunch, it makes sense to bundle products together for a lower price point when it makes financial sense.

Show your bestsellers.
Kissmetrics has pointed out that upselling happens fairly infrequently (4% of sales), but one of the ways to increase your odds is by recommending the most-sold items in your store. It’s probably a social thing- I will second guess my purchase if I see that the majority of people are buying this other thing. Even if I end up sticking to my guns, I’ll at least check it out.

Start with current customers.
Upsells work much better for existing customers. A recent example of this is me getting up-sold on for Beachbody Coaching. I had been using their on-demand workouts anyway as a result of not being able to run, but when asked if I wanted to become a coach at a greater cost to get some additional perks, I agreed. Why? Because I already knew the value of the stuff I was paying for, so I was okay with paying a little extra a month for things I was already going to use anyway. To me, it was a win-win.

Offer packages, including one very high end one.
An example of this is from a pinup photographer in Texas who offers four packages from $450 to $2250. Her most popular package is $850, which people feel much less bad spending money on when they see they could be spending more than double that. Most consumers buy the mid-tiered price item so give them options.

Setting Up Upselling Online

Use Your Existing Ecommerce Software
To implement upselling on your own ecommerce site, Woocommerce has a pretty straightforward interface for upselling (very similar to what they use for cross-selling, actually). Check with your ecommerce software’s FAQ section with how it is set up in your software.

Use Your Website Content To Help People Choose
If you have a list of services on your website at higher price points that people hem and haw at (and opt for the cheaper option), you can educate people in a few ways:

  1. Set up an FAQ page to make sure people know exactly what they’re getting and can determine what is beneficial to them.
  2. Create a multiple choice “Should I choose X or Y?” Some websites do this with a quiz, others with a features comparison chart. This allows a side by side comparison of two (or more) options.

Going through this process shows that you are invested in what the customer actually wants and what would work best for them: “Sell the benefit, not the product.” In other words, you may see the benefit for a person to buy the higher priced item but you may have to help them realize the value your product/service will add to their life.

Make It Exclusive
If you feel like creating a little mystery, allowing only certain people to buy a higher level item (think credit card companies with certain credit cards only a very exclusive group of people can apply for) can add to its mystery.

Think About Your Website Design/Copy
There are certain ways to make your website work better for upselling. One way is to run A/B tests with different designs/copy and see which give more sales. This is called working smarter, not harder! Learn more about A/B testing here.

In short, upselling is not a sleazy practice but one that builds customer loyalty in addition to benefiting your business.  

Kassie is a distance runner and a distance reader really. She lives in Ellsworth Maine and, while she might be quiet when you meet her, will throw out something witty when you least expect it.

Lessons From The Side Hustle

I think it’s safe to say that both Kassie and I are addicted to Side Hustle School, a podcast by Chris Guillebeau. I started listening because I thought it was interesting to have this short podcast, non-interview format. Most podcasts are 20-40 minutes with an interview and this one is typically 5-8 minutes with Chris being the only voice. I was curious how he’d keep it interesting… not to mention learn from the kinds of businesses he profiles.

The idea of the side hustle is it’s something you do outside your day job to earn a bit of extra money. Sometimes it becomes a full time thing of course (ex: the company website this blog post is on started as a side hustle while I worked at a newspaper). Mainly though, a side hustle is just that a fun, income generating, part time project.

I’ve conservatively listened to 75% of the daily episodes so here’s what I’ve gleaned so far.

Build it as they are coming (or even only build it if they pay you up front).

In a lot of cases, marketing for the side hustle started WAY before it was ready. In one case, a woman began collecting email addresses before her cookbook was even ready… so when it came time to sell it, she had an audience waiting to buy. In another (which I can’t seem to find on the site) a guy studying for some kind of exam given to doctors made a landing page where people could pre-buy his study guide. He didn’t make the study guide but when enough people were interested, THEN he pulled it together.

So get your marketing ready even before your product or service is ready so you can start building excitement… and collecting potential customer contact information.

If people keep asking for it, it might be an upsell.

If people keep asking if you deliver your homemade cookies, chances are you may be able to upsell a delivery service with your cookies.

You want to look for this feedback coming from different places, not the same group of friends. For example, when our web host friends, web developer friends, and clients started complaining about how annoying it was to keep Wordpress website software up-to-date, we started a Wordpress Insurance service for $25/month.

What are your customers complaining about or asking you for? This might be a place to start.

Controlling as many things as you can keeps things in control but it does limit your profit/scale.

One of the companies profiled was a cleaning service created by a student. There was a point in business growth where he realized he’d make a lot more money if he worked with other reputable people who helped clean the houses… but it also meant he had to create systems and other ways he could control the quality of work being done by other people. Keeping things in house, like if you are manufacturing your own candy hearts with custom messages, you are limited by how many you can stamp out in a day… but that might be ok. Just know there are tradeoffs, always.

If it doesn’t work the way you want it to, be flexible.

There are certain kinds of businesses that seem sexy to open: bars, coffee shops, restaurants, etc. The problem is most people can’t go from zero to their own cafe, financially or otherwise.

When two friends wanted to open a distillery and saw all the regulations, they decided to make homemade gin kits… and were a success. If they had been inflexible about how they were going to get artisinal spirits to the masses, they would have lost out.

Most careers, if you really think about them, have a way that you can step into them… because the idea with the side hustle is…

Risk as little as possible.

Yes, you should spend time building or trying things,  but don’t sink thousands of dollars or hundreds of hours into something. Look for a quick win, even if it’s small, which can encourage you to stay on the right track. For example, an orthodontist as an experiment spent $500 on Facebook ads but rather than just ‘boosting’ them to make more of his friends see them, he used them strategically to attract patients seeking braces with a $400 off coupon. He didn’t build a whole new section of his practice or do anything crazy; he just tried something small and when it was a win, he could adjust other things accordingly and move onto the next win.

If you’re interested in small business development, making extra money, or just hearing people with cool ideas, listen to Side Hustle School. Whether you have never had a business or run several, I guarantee it’ll give you ideas for moving ahead.

Nicole runs Breaking Even Communications, an internet marketing company in Bar Harbor Maine. When she’s not online, she enjoys walking her short dog, cooking with bacon, and trying to be outdoorsy in Acadia National Park.

Selling Stuff Online: Products

SellingShizOnlineLast week, we talked about some basics you needed to be ready to sell things online. The next few weeks is the fun part: what you actually sell!

The most normal thing to sell is physical products. Physical products being things that have dimensions, weight, and possibly variables for people to select from (sizes, colors, etc.)

Selecting a shopping cart software: part science, part art. 

We’ll get into selling other types of things next week but you don’t need me to tell you that buying a seat in a stadium for the next Britney Spears concert you are going to is different than buying a black t-shirt. So different cart software is built to sell different kinds of things. You may also want to ask yourself these questions as you start your research to find a cart you like:

1) What integration does my cart need to have? If your cart needs to interact with your POS system or Quickbooks, that’s a good way to cross off a lot of options up front. Note the word ‘need’ here, you may be smitten by some swoonworthy features but knowing what you need will keep your eyes on the prize.

2) What payment gateway do you want to use? Some software only works with one or two gateways, some work with lots more. If you don’t have passionate views on payment gateways like some of us do, enter into this research knowing you’ll be flexible.

3) What are you planning on selling? And how many? See concert tickets versus black t-shirt example above. Also some cart software charges you by the quantity of items you list. So get a clear idea of what you want to sell first to help you evaluate options.

Once you have your cart softwares narrowed down to two or three options, start reading online reviews and looking at examples of each. This will give you an idea of customer support and whether you like the way it looks. For example if a cart promises to be ‘responsive’ and looking at the 4-5 examples listed on the website none of them seem mobile friendly, you may want to ask yourself why. Or you could just hire some nerd to do this nerdy research project for you. Seriously, there is a reason I can’t find a fun picture to go along with this.

Care about the little things.

The more information you give to customers, the better. Things like dimensions and weight not only help them figure out how that item will look in their living room but help you figure out how much to charge for shipping. When possible, fill out all available fields for each item in your cart software… and be consistent product to product.

Decide on shipping.

The below chart shows why you need to decide about shipping:

shipping-study

You have a few options when it comes to shipping: free, calculated, or flat rate. Rather than saying the same thing this article says, I’ll link to a nice blog post from Shopify about the differences between these three. 

In short, we’ve seen free shipping is quite motivating for a lot of people… and most consumers understand the idea of the minimum order amount to get it:

someecardfreeshipping

 

Cross-selling and Upselling: Helping People Buy More

So now you have what you’re going to sell, a cart you’re going to sell if from, and some idea of how you’ll handle shipping.

Now it seems a little sad we’re already thinking of how we can get your customer to spend MORE money with you but why wouldn’t we be? Your favorite brands cross-sell and upsell to you all the time.

Cross-selling: If you like X product, you may also like Y, Z, and A products. Or customers who bought X also bought… you get the idea. Many cart softwares will let you cross sell.

Up-selling: Getting someone to buy a higher priced version of what they were going to buy.

This is the best visual example for this I have ever seen. And the blog it comes from is super useful and you can go read it: http://blog.flowify.net/up-selling-and-cross-selling-how-to-increase-your-restaurants-revenue-using-resources-you-already-have/

UpsellingInfographics

 

Luring Them In With Bargains: The Allure of the Coupon Code

Now there may be points in the life of your online cart where you either need to move some inventory (to make way for new stuff) or you want to experiment with pricing. Coupon codes are something you can typically issue for either a dollar amount or percentage off either all the items in your cart or just certain items. For obvious reasons, they typically have an expiration date.

What coupon codes allow you to do is measure if/how purchases change while it is in effect. Most cart software will let you make them.

Then you distribute the codes (or perhaps different codes) via direct mail, email, social media, print and online ads, etc. to get them to your customers.

Old-Navy-THANKYOU-376x300

 

So I hope that is helpful as you sell physical products in your online store! Next week, we’ll talk about selling event tickets and things you may want to think about related to that. Stay tuned.

 

Nicole runs Breaking Even Communications, an internet marketing company in Bar Harbor Maine. When she’s not online, she enjoys walking her short dog, cooking with bacon, and trying to be outdoorsy in Acadia National Park.