Chandler Olson
February 28, 2022
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Most Shopify store owners are familiar with the term upselling. In short, upselling is when a store recommends or encourages a shopper to buy a higher-priced version of a certain product. The reason why it is called upselling is that you are being "up-sold" to make a purchase that is above and beyond your original decision. Upselling and cross-selling are often used interchangeably.
However, there is a difference between the two. While both are an attempt to increase overall sales by making additional offers to consumers, they differ in how the customer is approached. Cross-selling refers to making offers based on related items that are not specifically asked for by the consumer while they are making their purchase. For example, when you check out on Amazon or eBay, they will usually recommend accessories or other items that complement the existing item in the shopping cart as a bundled purchase ultimately cross-selling the purchaser on related products that complement each other.
Upselling refers to making offers based on an item that was specifically asked for by the consumer and ultimately offering them to buy a more premium version of the product or increasing the value of that purchase on the particular item in the cart.
Cross-selling is one of the most powerful strategies that a Shopify merchant can utilize. Looking for cross-selling opportunities and implementing them plays a vital role in customer satisfaction. When it comes to acquiring new customers, eCommerce stores have to optimize and identify target audiences to retain their current customers. This article will discuss ways to identify a cross-selling opportunity for a customer.
To be successful, merchants have to create and present cross-selling opportunities that match the needs of customers and unfold the maximum revenue potential. This is what separates the winners from the losers.
Cross-selling is one of the most effective methods of marketing. When done right, it can increase the average order value and it can also improve customer satisfaction by providing customers with everything they need to use their new product correctly and effectively, which in turn also turns them into repeat purchasers. Cha-ching.
Upselling random products to buyers causes confusion in the sale and will force them to abandon the purchase mid-purchase flow. Customizing upsell offers to give shoppers what they actually want is much more effective at convincing them to buy. For example, if a customer buys a laptop, then you could offer them a wireless mouse, that complements their purchase.
If you were to offer a sweater instead, that’s probably not something they’d be interested in and likely won’t increase your average order value.
Many eCommerce sellers offer products that complement each other — for example, a vacuum and a set of replacement filters. But identifying cross-selling opportunities is more than just paying attention to product categories.
The most effective cross-sell opportunities are based on shopping behavior. They're not just about selling similar products to the same customers, but instead about how you can help your customers be successful by offering the right products at the right time.
What have your customers purchased in the past? It's likely they've purchased items that you sell as part of a package, like a camera and accessories. Cross-selling isn't just about selling similar items, though — it's also about solving the customer's problem or helping them achieve their goals. For example, if you sell cameras, you already know your customers are interested in photography. You may be able to sell them printers or picture frames to go along with the initial purchase.
Many Shopify stores offer products for different purposes. Some shoppers may be aware of these relationships between products, but many won’t know about them until they see a suggestion at checkout or on product pages. By pointing out these relationships in your store and showing customers additional items they might like, you can increase your sales by giving customers what they need.
The cross-sells you suggest need to be relevant and valuable for your customers if you want to influence their purchasing decisions. To find the most relevant items, you need access to data about your customers' personas and purchase histories — i.e., what they like, what they need, what they have bought in the past, etc. You also need access to data about your products — descriptions, price ranges, and other characteristics that would help you, group, similar items together.
A good rule of thumb to follow is that cross-sells should be complementary products, not substitutes. For example, if a customer is buying a blender, don’t suggest an immersion blender as a cross-sell. Instead, recommend a set of mixing bowls or whisks since they are complementary products that go hand in hand with a blender.
If customers have an issue or pain point, they need help solving it. If you're not recommending products or solutions to fix these problems, then you are missing an opportunity for cross-selling.
If you can make customers happy by offering effective solutions, they will be more likely to become repeat customers and recommend your store to others. This is one of the biggest gains in cross-selling – a happy customer is much more likely to buy from you again and recommend your business than a customer who didn't receive any relevant product recommendations.
Cross-selling is more cost-effective than acquiring new customers and offers a higher ROI. Existing customers have lower marketing costs because they are already familiar with your brand, and they are more likely to buy a new product as they already trust you.
The most important thing to remember is that cross-selling is a means to an end; it is not the end itself.
Use this technique only when it makes sense for your store and your customers. You won't lose your customers' trust, which is a lot harder to regain than to build.
* The product you're offering will help the customer reach their goal
* Your customers are likely to buy the product again in the future
* You offer items at different price points (to appeal to a wider range of customers)
* The products you're offering are related, but not identical (e.g. a variety of different types of tea, instead of different varieties from the same brand)
In the end, the key is to present cross-sells and upsells in a way that does not interrupt your customers or push them to buy, but rather guides them gently toward buying. The best cross-selling opportunities are placed where your customers will see them often but won’t feel like they’re being pressured into buying. They are positioned where customers can easily recognize their relevance and are encouraged to act on that relevance.
Ultimately, the best way to identify cross-selling opportunities is to get to know your audience as best you can and understand what they need. Use that information to identify additional products or services you could offer customers through your app. It is a lot of work first identifying these opportunities, but the payoff for you is worth it.
