Both cross-selling and upselling help to convince customers to spend more money than they had actually planned.
Product recommendations have become an indispensable part of online stores. They not only increase customer satisfaction, but often also overall sales. Customers who have viewed product recommendations on the website have spent an average of 10% more than users without product recommendations.
Meaningful recommendations are therefore already a must. I have compiled some tips on this in Part 1 and Part 2 of my article series on Recommendations. But now we want to go one step further: Wouldn’t it be nice if users didn’t just buy one item, but a few more?
There are a few mechanisms you can use to achieve this.
Cross selling is the process of suggesting additional products or services to customers that match the products they are currently looking at or that are already in their shopping cart. Classically, this could be the right cartridges or toner for the printer, the right shoe care products for the suede shoe, or the right belt for the jeans. The aim here is to increase revenue per customer by selling additional products.
The placement of the recommendation plays a particularly important role here. On product detail pages or in the shopping cart, they make it easier for users to quickly complete an additional purchase. Without having to click through the product range again, the product quickly ends up in the customer’s shopping cart. Our experience with us at 35up as well as trbo shows that such integrations can work very well. By implementing recommendations in the shopping cart, we were able to increase the conversion rate by up to 31%.
In addition to the right placement, it is of course also important to suggest products to users that they really want to see. If you show customers items that match their preferences and interests during their customer journey, they are likely to be inspired to make a purchase. For example, imagine seeing the matching necklace and ring from your favorite jewelry collection — who wouldn’t grab it?
So stores have several ways to suggest matching cross-sell products. On the one hand, they can use keywords to assign other matching items to a product. On the other hand, they can let a smart algorithm determine which products best match the user’s interests and needs.
In this way, the user feels well advised and the store operator benefits twofold: suitable recommendations increase both the value of the purchase and customer loyalty.
Upselling refers to measures designed to persuade users to buy a higher-quality and therefore often more expensive product than the one they have selected. The aim is to persuade customers to spend more money than originally planned and thus increase sales even further.
However, this form of recommendation is also most frequently placed on product detail pages and in the shopping cart. Both product recommendations and product comparison tables can be used here. The product currently being viewed or the product in the shopping cart is compared with other products in the same category or brand. It is important that the price of the recommended product is higher than the price of the currently viewed product and ideally this product also has more functionalities to offer. In this way, the customer should be convinced of the more powerful product and be willing to pay more for it. For example, if a customer is currently looking at a smartphone with low storage capacity, he or she can be offered another one with more storage space or the successor model. But upselling can be used in more than just the retail sector. The travel industry can also benefit: If a user wants to book an airline ticket, he can be informed that an upgrade with a better travel class or more legroom is available.
But no matter how attractive the additional sales opportunities appear, they should not be completely exhausted. For one thing, the product must still meet the user’s interests and not exceed his or her budget too much. It doesn’t make sense to offer a customer a TV that costs €1,800 when he’s currently looking at one for €400. We also recommend using A/B tests to determine how users react to upselling features in the web store. It is not uncommon for customers to be confronted with too much information, which in the worst case can lead to shopping cart abandonment.
Inspirational pages and so-called product bundles are becoming increasingly popular. After all, to a certain extent they can keep up with the personal advisors but also the mannequins for inspiration in brick-and-mortar retail. And users are also spoiled by Instagram & Co. — outfit and interior combinations just have to be re-shopped.
Imagine: A user was actually just looking for a new T-shirt — but the clever store operator reacted immediately and offered a complete outfit. The result? The matching jeans, shoes and a jacket end up in the shopping cart.
Such product bundles don’t have to be limited to the fashion industry either. They are also commonly used in the food industry, telecommunications, electronics, etc. For example, if you offer electrical goods in your online store, you can create a bundle that allows the customer to buy accessories such as a second controller and a game in addition to the selected console. This not only saves time when searching for the right accessories, but ideally also saves money. If you reduce the price of a bundle, you can convince the customer of the full product range and nothing stands in the way of a successful purchase.
Both cross-selling and upselling help to convince customers to spend more money than they had actually planned. However, in order to really convince customers, it is necessary to respond to their interests and needs. They should still have the feeling of being well advised and retain confidence in the web store in question. Not every measure is received equally well in every store. Therefore, tests should always be set up to judge whether users respond well to the measures. Satisfaction with the recommendations can also be ascertained via on-site user surveys.