Let’s chat today about upselling. Yes, this is a hard word for many in the direct sales industry to say, let alone do. You might have refrained from upselling because you didn’t want to come off like that creepy salesperson. We don’t want to be:
Perceived as being pushy. We're swimming in a culture where upselling, done like the odd car salesman, creeps us out. We know, for him, it is all about making money, and we don’t want to come across like that because, for us, it’s really more about helping our customers.
There is also always that fear of rejection: fear of the customer saying no, because sometimes rejection can feel like they are rejecting us, not the offer.
And there is also a genuine belief that customers know best. We may think, "Well, this customer called to order this specific product—that's all she wants, that's all she needs; if she needed something else she would have asked for it. Who am I to suggest anything else?" We genuinely believe that customers know about the special and promotions. She knows what she needs, and to suggest a higher quantity or something else is wrong. While we would love it if everyone in the world knew about the products you sell and what works well together do they really? And the answer to that is simply no.
If any of those thoughts have ever stopped you from upselling to a customer, well then this information is for you! I want to challenge the way you think about upselling. I want to leave that creepy sales person mentality in the dust and give you some new ways to upsell in your business.
But first a little story. I recently went to a fast food restaurant with a craving. I wanted those deep fried sticks of potato salty goodness. In fact, I was craving it so much that I could have eaten the entire vat of fries. But, like many, even though we are craving an entire vat of fries, I didn’t necessarily want everyone to know I could eat an entire vat of fries. So as not to appear piggish, I put a game plan together before going into the chain. I decided I would ask for the sandwich and then when the person behind the counter asked me as they always ask, “Do you want fries with that?” I would casually play off my craving with a “sure, why not” response. And as I began placing my order, the person punched into the terminal my sandwich request and read me my total. At first I was shocked, so shocked that I didn’t know how to respond to that scenario. I had practiced it in my mind going a completely different way. It had never even crossed my mind that I wouldn’t be asked if I wanted fries. So I handed over my payment, still in a state of shock, and sadly left the eating establishment without my fries. Oh, to say that I was devastated or shocked is an understatement. Has this ever happened to you? Have you ever wanted someone to talk to you or offer you a deal but they didn’t?
It isn’t unusual that people want to be offered the deal. According to SmartMoney, 15% of customers want to hear additional offers.
And then there are even more who don’t know how the product will benefit them…yet.
So, how do you know which 15% of your customers are those who want to hear the offer? How do you know who is going to be disappointed if they are NOT asked “if they want fries” with their purchase? Simply put…you don’t. Offer the upsell to everyone.
So, how do you offer the upsell? Here are three easy steps to help you through the upselling process.
Step 1: Be courageous!
The next time it crosses your mind that you don’t want to offer the latest promotion to a customer, think about me, who hates to ask for fries, but now I have to, because not every person behind the counter will ask me if I want fries with my order. Let people know what is up! And don’t disappoint those who need you to ask if they want what you are selling. Upselling is really offering an up-service. So be brave and offer it to your customers.
Step 2: Basics of upselling
The next step is just to understand the basics of upselling. Some fundamentals to keep in mind are:
First, the price ranges of the items that you wish to upsell generally should not go beyond the price of the items the customer plans on purchasing. For example, fries cost less than a sandwich.
And second, an upsell item should be about 20% to 25% of the total purchase price.
Now it’s hard to think in numbers like that, 20% to 25% of the purchase price, so let me walk you through it.
Let’s say you have a customer that is planning to purchase purchases an item for about $15.00.
So now, taking 20% to 25% of $15, that’s roughly about $3, give or take.
So, knowing that your upsell item should be about $3 dollars, what can you talk to your customer about adding to her order?
Don’t worry about remembering percentages, maybe think of it more as what are the core basics that customers buy and then think of an easy upsell item that you can always offer with the core item. Do the math beforehand so you aren’t offering an upsell that cost more than the core and that the upsell is about 20-25% of the cost of the core item.
Step 3: Movie-theater approach
Now step number three is to be like a movie theater. Recently, my little family went to see a new movie that came out. We purchased our tickets online (spending $28 dollars for the four of us) before we even left home. Now, I love this process. We get to choose and reserve our seats even before getting to the theater. We always pick the middle side right of the theater, next to the aisle. We always get the same seat. No more super early to avoid the neck-breaking front row. Then we went to the movie theater and retrieved our tickets from a kiosk, and before we enter the theater, we walked past the concession stand. And boy, the call of the popcorn is strong. We bought drinks and popcorn, easily spending another $30. But we forked it over without even blinking. All in all, we paid $58 to have my feet stick to the floor and sit in the dark to watch this movie. But why did I not even blink an eye at spending money for the admission and the movie, popcorn, and drinks?
There’s one important thing that the movie theater does. They begin to upsell the giant tubs of popcorn and super-sized drinks after I had prepaid for my tickets. They split the total cost of the excursion to the movies into two payments. Did I know that I had spent a total of $58? Well, I knew I did. But in my mind I had it split into do different totals, $28 for the tickets and $30 for the treats. And for some reason that felt a lot more reasonable than the entire total. It is a little trick of the mind, isn’t it?
What is the effect of upselling by cinemas? Usually the value of each customer doubles once they visit the food stand. And it’s guesstimated that about 60% of customers who go to the movies purchase from the concession stand.
How does that relate to your business? Well, if the value of the customer’s order generally doubles and about 60% of the people purchase the upsell item, why not do what they do? Why not break up the purchase into reasonable prices over a period of time. Not everyone will buy it, just like not everyone buys popcorn at the theater, but by breaking up the purchase price into manageable chunks, customers may be more likely to buy even more. How can you add the upsell purchase as a second transaction?
Now, the next time you offer a customer the perfect add-on to their purchase, do so courageously! You can do that because you planned ahead a little to pair the perfectly priced upsell with the core items you sell. Remember, you are not the creepy salesperson, but instead, you are offering your customer a valuable service, and they will be sad if they miss out on it.
Author: Stacy San Juan is a marketing maven who has worked in the direct sales industry at the corporate level for multiple international companies for nearly a decade. She specializes in marketing, training, and new product development. Because of her roles inside the corporate offices she gets why direct sales companies do what they do. And because she has interacted with thousands of direct sales representatives in her roles, she has seen what works for a representative and how they can get the most from their business experience. Not only does she have a passion for marketing, training, and new products, she also loves her family (her husband and two daughters) and her home in American Fork, Utah. And of course, Netflix, online shopping, and Diet Coke.