Have you heard the term up selling? Up selling is a marketing technique that can be tried to increase sales. This strategy is commonly found in fast food restaurants when ordering food to encourage consumer purchases.
You too may have experienced it. For example, in a fast food restaurant or coffee shop, there will usually be some questions that are quite familiar. For example, "do you want medium or large size, sis?" or "Would you like to add caramel topping as well, Sis?"
Such questions become part of the upselling method. This strategy can not only be applied to goods, but also to service products and other services.
Then, what is upselling? According to Sales Force, up selling is a sales strategy that is carried out by encouraging customers to buy products whose value is higher than the initial product that consumers want. It can be said that up selling is a marketing technique used to influence customer interest.
With this strategy, it is expected that customers are willing to buy similar products but at a higher price. This price increase can be influenced by product quantity, product size, as well as the latest or more complete variants of similar products.
What is Up Selling?
Up selling is a sales technique that focuses on selling products or services with more complete features to existing customers. For example, if someone is buying a cell phone, the seller may offer a plan with better services or a phone with more features. The purpose of up selling is to increase sales value and increase company revenue.
Up selling can also be done by offering a product or service that is more expensive to customers who have never purchased the product before. For example, if someone has never bought a beauty product, a seller can offer a more expensive beauty product with more complete features.
Difference between Up Selling and Cross Selling
The main difference between up selling and cross selling is that up selling focuses on selling products or services that are more expensive or with more complete features. While cross selling focuses on selling additional products or services related to the product being purchased by the customer.
In addition, up selling is usually done by offering a better version of the product that the customer has purchased or by offering additional products related to the product. Meanwhile, cross selling is done by offering products or services related to the product being purchased by the customer.
Why is Up Selling Important for Business?
Up selling is important for businesses because it is an important selling technique for businesses because it can provide significant benefits. This can increase sales value, company profits, and customer satisfaction.
Therefore, it is important for businesses to understand up selling techniques and strategies and use them effectively.
Benefits of Up Selling for Business
The benefits of up selling for businesses are as follows:
1. Increase sales value
The first benefit, can increase sales value by offering products or services that are more expensive or with more complete features to existing customers. This can increase the company's revenue and provide greater profits.
2. Increase company profits
The second benefit, can increase company profits by increasing sales value. In addition, up selling can also reduce selling costs by reducing the time spent looking for new customers.
3. Retaining Customers
Furthermore, it can help companies retain existing customers by offering better products or services. This can increase customer loyalty to the company and reduce the possibility of customers switching to other companies.
4. Increase customer satisfaction
The last benefit, up selling can increase customer satisfaction by offering better products or services that suit customer needs. This can improve the company's image and enhance the company's reputation in the eyes of customers.
Doing up selling properly can be an effective way to increase company revenue and profits, as well as maintain and increase customer satisfaction. Therefore, it is important for businesses to understand up selling techniques and strategies and use them effectively.
What are the Up Selling Strategies in Business?
The things that need to be considered before implementing an up selling strategy are:
1. Knowing the Target Market
Identification of the right target market is the first step in determining an up selling strategy. This will help the company determine the right product or service to offer to existing customers.
2. Knowing Customer Needs
Furthermore, companies must understand customer needs in depth. This will help the company offer products or services that match customer needs and increase the likelihood that customers will accept the offer.
3. Using Sales Techniques
The next step, determine the sales techniques that will be used to offer the product or service to customers. This can include using examples, open questions, and other sales techniques.
4. Monitor and Evaluation
Finally, always monitor and evaluate the up selling strategy used. This will help the company evaluate whether the strategy is effective or not and make changes as needed.
What are some examples of up selling from various types of businesses?
The following are some concrete examples of how up selling can be done in various business situations:
1. Airline Ticket Sales
When someone is going to order a plane ticket, the seller can offer tickets with a higher class or with more complete facilities, such as free food and drinks, wider seats, and priority service at the airport.
2. Sales of Electronic Products
When someone is going to buy an electronic product, the seller can offer a product that is more expensive with more complete features or with a longer warranty.
3. Sales of Beauty Products
When someone is going to buy beauty products, sellers can offer more expensive products with higher quality ingredients or with more specific benefits for certain skin problems.
4. Sales of Tour Packages
When someone is going to order a tour package, the seller can offer a more expensive package with more complete facilities, such as 5-star hotels, free food and drinks, and extra activities such as spa or golf.
5. Sales of Insurance
When someone is going to buy insurance, the seller can offer insurance that is more expensive with wider benefits or with a higher claim limit.
6. Sales of Fashion Products
When someone is going to buy a fashion product, the seller can offer a product that is more expensive with better quality or with a more trendy design.
7. Sales of Health Care Products
When someone is about to buy a health care product, the seller may offer a more expensive product with wider benefits or with higher quality ingredients.
To up sell effectively, it is important to understand the needs and wants of customers, and demonstrate confidence and good selling skills. In addition, it is also important to avoid forcing customers to buy the products or services offered.
How to optimize up selling?
Up selling is the practice of getting customers to buy a related or more expensive product or service in addition to what they already bought. To optimize it, you can use a Customer Relationship Management (CRM) system to support up selling. CRM is able to provide information and tools that help salespeople understand customers better and identify opportunities to offer additional products or services.
Here are some ways to optimize up selling with a CRM system:
- Data analysis: Use customer data in your CRM to identify patterns and trends that can help you understand what your customers are interested in and what products or services they are most likely to buy.
- Customer segmentation: Use CRM data to divide your customers into different groups based on factors such as purchase history, demographics or interests. This can help you tailor your upselling to different customer segments and increase your chances of making a sale.
- Personalize communications: Use CRM to track customer interactions and preferences, and use this information to personalize your communications with them. This can help you build stronger relationships with your customers and increase your chances of upselling.
- Use automation: Set up automated processes in your CRM to help you identify opportunities for upselling, such as sending targeted emails or notifications to customers based on purchase history or other relevant data.
The Technique of Applying Up Selling
Up selling technique is done by offering similar products at a higher price. In implementing it, businesses must sell several variants of the same product, but with different prices and values. For example, in coffee shops you can sell drink variants in three sizes. The three sizes are small, medium and large. All three of course have a price difference.
Sometimes, medium size is often used as a distraction so that buyers are faced with "responsible" choices. Thus, buyers tend not to choose drinks with small sizes because the portions are small, so buyers will choose larger sizes, especially since the price difference is not that significant.
Try to imagine how much increase in profit you will get if all customers end up choosing large coffee packaging? That's how the up selling technique works. Customers will be encouraged to spend more money to buy similar products with higher selling points.
However, keep in mind that implementing an up selling strategy needs attention. Because up selling is a strategy to increase sales, as a business person, you must also understand customer needs, provide convincing advice, and of course provide competitive prices for each product marketed.
Example of Up Selling
For example, when you buy a book about fish farming. The seller will offer a similar book on how to cultivate fish using the Biofloc Technology (BT) method.
Well, usually you will get an explanation of the advantages of Biofloc fish farming books by cultivating fish in the usual way. Where is the Biofloc fish farming book more profitable, promising and less capital.
Of course, the price of books on Biofloc fish farming is more expensive because technically, the author writing the book requires different knowledge and breakthroughs than catfish farming in general.
Conclusion
Thus our review of upselling starting from the definition, benefits, and what the strategy is. Get various other interesting information about email marketing on our blog.