In this article, you’ll find
- What is Upselling and Cross-selling?
- Upsell vs. Cross-sell – Understanding the Difference
- Upselling and Cross-selling Examples
- Upsell vs. Cross-sell – Why Your Online Business Needs Both
- Tried and Tested Shopify Upselling and Cross-selling Strategies
- Where and When Can You Upsell and Cross-sell On Your Shopify Store?
- Upsell vs. Cross-sell – Who Wins?
Did you know that there are around 1.75 million Shopify merchants worldwide? That’s not all. A whopping 3.76 million live e-commerce websites use Shopify to sell products. These numbers suggest that Shopify is one of the leading e-commerce platforms in the world. On the flip side, these figures indicate that Shopify has become an increasingly crowded online marketplace. Today, even the most established Shopify merchants cannot sit back and rely solely on their past success. Old and new e-commerce business owners must adapt, innovate, and stay abreast with the latest industry trends.
There’s one thing some of the most successful businesses like McDonald’s, Amazon, Apple Store, and eBay have in common. Apart from becoming household names worldwide, these brands have championed the upsell vs. cross-sell battle and have successfully deployed a perfect blend of effective upselling and cross-selling strategies to get where they are.
While several factors distinguish a thriving business from a struggling one, this blog focuses on two popular commercial sales and marketing techniques – upselling and cross-selling. Many business owners hit a dead end while finding a clear-cut answer to this common dilemma – upsell vs. cross-sell?
Spoiler alert! If you are looking for an answer in the upsell vs. cross-sell battle – both are equally important.
This article dives deeper into understanding the nuances of upselling vs. cross-selling while examining some of the most effective Shopify e-commerce strategies.
What is Upselling and Cross-selling?
Upselling is a popular sales technique that aims to influence or encourage customers to purchase the premium option of the product they are likely to buy or already own.
For example, if you are looking for a smartphone on Amazon and click on a specific smartphone from a certain brand to learn more about the product, Amazon will display more smartphones with better features and specifications on the same page to upsell a more expensive product to drive higher revenue and profit. This is what is called Upselling.
Unlike upselling, cross-selling is a sales strategy that primarily focuses on selling complementary products to customers. These products are typically from a different category but will be complementary.
For example, a screen guard that is pushed to you while you look for a smartphone or the push of a keyboard when you look for monitors are great examples of cross-selling.
Upsell vs. Cross-sell – Understanding the Difference
The difference between upsell vs. cross-sell is actually in their names. Cross-selling aims to maximize profits through selling lateral products that complement the original purchase. On the other hand, upselling maximizes profits by encouraging buyers to purchase a premium version of the original product.
Upselling and Cross-selling Examples
Let’s examine two excellent examples of how brands deploy upselling and cross-selling strategies.
Here, Booking.com deploys an upselling strategy to maximize revenue by displaying a premium room at the time of reservation. Additionally, the rooms are displayed at a discounted price, invoking a sense of excitement and curiosity among customers. This is a great example of upselling during checkout.
The Apple cross-selling strategy is as straightforward as it can get. Once buyers add a smartphone to the cart, it swiftly displays a prompt that showcases other products that can be paired with the smartphone. Additionally, the prices of the products are also shown in installments for those who cannot afford to buy them at once. This is a great example of cross-selling that also uses the pricing strategies of product bundling.
Upsell vs. Cross-sell – Why Your Online Business Needs Both
Both upselling and cross-selling are designed to stretch buyer intent and convince them to make additional purchases to boost profit margins ultimately.
A HubSpot Blog survey of over 500 sales professionals revealed that around 72% of sales executives that upsell and 74% that cross-sell said that these techniques increased their revenue by 30%. With results like these, entrepreneurs who do not upsell or cross-sell are clearly missing out on opportunities and leaving a lot of money on the table. Simply put, upselling and cross-selling expand the sales funnel while trimming its life cycle resulting in higher yield per customer.
If you are a relatively new Shopify merchant, you can start by upselling or cross-selling your products and eventually have a mix of both. The end goal should be simultaneously implementing a mix of upselling and cross-selling to maximize profits and revenue from every purchase.
Tried and Tested Shopify Upselling and Cross-selling Strategies
Now that we’ve established how upselling and cross-selling are interesting sales and marketing techniques that have the power to influence a buyer. Let us look at some of the most effective upselling and cross-selling strategies that could uplift your e-commerce business and take it to the next level.
- Understand Product Bundling and How It Works
Product bundling did not start online. It was a cross-selling technique primarily used by retailers worldwide before the e-commerce boom. That said, e-commerce websites did not waste time introducing product bundling online.
Product bundling is one of Shopify merchants’ most effective cross-selling techniques today. As the name suggests, product bundling refers to offering a group of supplementary products that improve the usage experience of the primary product.
For example, if your customer is interested in a football, you can offer a bundle that includes football shoes, a jersey, and an air pump at a discounted price. The key here is to encourage the buyer to purchase supplementary products priced lower in a bundle instead of if they were to be sold individually.
If you want to bundle products on your Shopify store, you could use product bundling apps like BoxBuilder on Shopify.
- Leverage User-generated Reviews and Content
Let’s assume you have just finished relishing a delicious meal at an Italian restaurant. You loved the meal so much that you are motivated to write a positive review to support the business. By doing so, you are not only offering your support to the restaurant, you are indirectly marketing for the restaurant.
The same logic applies to your business on Shopify. As a business owner, you should leverage user-generated content for effective product marketing and promotion. Online reviews written by genuine customers have a higher value than marketing content created by brand marketers. This is why it becomes crucial to stay on top of user reviews and use them as social proof.
One of the best ways to get started is to compile product ratings and user reviews for a specific product and then strategically display them to your customers at different sales funnel stages. These reviews instill trust and convince customers to make a purchase. Some of the most successful businesses on Shopify use reviews to persuade buyers.
- Utilise Customer Data to Upsell
You may have read or heard the phrase, “Data is the new oil.” What it means is that data is a valuable resource businesses have at their disposal. Business owners should utilize data to create value and formulate a solid upselling strategy.
You can start by bifurcating your customers based on various parameters, including their history with your brand, lifecycle stage, subscription model, and more. You can even assign a score to each customer based on their actions and interactions with your online store.
Segmenting your customers based on data allows you to provide personalized user experiences and create tailored upselling strategies for each customer group.
- Focus on Relevant Product Recommendations
This is a common cross-selling mistake e-commerce business owners make. As much as you want to drive sales and maximize revenue, you should not overdo it and make unnecessary product recommendations.
For example, if your Shopify store sells perfume and a customer adds one to their cart, it wouldn’t be wise to suggest adding a t-shirt. Instead, you can suggest perfumes in a similar price range or a body mist to go with it. It is essential to make relevant product recommendations to entice customers and ensure they have a pleasant experience while interacting with your online store. The goal here is to offer value instead of being too pushy or aggressive.
An extra tip – it is a good practice to recommend at most three products per page. Anything beyond this could distract your customers and result in them leaving the site or abandoning their cart.
- Invoke Urgency and Induce Fear of Missing Out (FOMO)
Do not forget one golden rule – the fear of missing out (FOMO) is felt by everyone. Yes, even celebrities like Kendall Jenner feel it. A bikini brand from Australia looking to penetrate the U.S. market recently placed its bets on a marketing plan that largely relied on FOMO. The company had a limited budget to get Kendall Jenner onboard to market its products. Here’s what they did. They sent gifts to all of Kendall’s friends but her. Everyone around Kendall was wearing bikinis from the same brand, giving Kendall a massive FOMO. She contacted the business owners and asked them to send a few products over. Who won? The small business.
While you can resort to similar tactics to win clients, the message here is to induce FOMO or a sense of urgency among your customers. You can create a sense of urgency by turning to smart and clever copywriting. Phrases such as “Last 10 pieces available” and “Discount ends today” can create urgency and spur your customers to action.
- Suggest Premium Products Smartly
Suggesting premium products is a common upselling technique Shopify business owners use. However, this technique is only effective when buyers realize and understand the benefits of the suggested premium products. The onus here is on business owners to educate their customers about how these premium products stand out compared to regular products.
A good upselling technique is to allow your customers to compare different variations of the same product. While this technique is effective for electronic products, it can be deployed by Shopify business owners from different categories.
- Give Discounts and Offer Incentives
This approach primarily works on the same principle as the fourth point – invoking urgency. Listing products at a discounted price or offering incentives often plays a key role in playing with a buyer’s emotions. It is fair to say that customers buy products primarily based on their emotions and requirements. Here, you are tapping into their emotions to maximize profits and drive sales by offering discounts and incentives.
Offering discounts is an excellent upselling technique on Shopify, especially if paired with a creative idea. For example, “buy one, get one free” or “free shipping” can boost sales, and tools like ADG (Automatic Discounts and Gifts) can help you manage all your deals easily.
- Utilise Shopify’s Upsell Popup or third-party apps
As mentioned earlier, Shopify is one of the most popular and widely used e-commerce platforms worldwide, and for good reasons. The platform offers a range of useful free and paid features that assist business owners in running a successful online store.
For example, Shopify offers an upsell and cross-sell popup tailored for every stage of the funnel. The popup automatically recommends or suggests products based on a customer’s behavioral and sales history. Shopify’s upsell and cross-sell popups are key in generating sales without spending on ads. The upsell popup also boosts your online store’s average order value.
On the other hand, you could also use third-party apps like Ultimate Upsell, which makes it relatively easier to manage your upselling strategy with features like upsell bundles, add-ons, and subscription-based items, replace items in the cart with a better, bigger offer, etc. Using apps like Ultimate Upsell also requires no coding skills and allows you to keep your original SKUs in the orders.
Where and When Can You Upsell and Cross-sell On Your Shopify Store?
Before we decide to settle the upsell vs. cross-sell debate, let us first explore where and when you can use upsells and cross-sells.
- On the Product Page
Placing offers and offering incentives on the product page offer tremendous value to customers as it simplifies the process of finding what they are looking for. Multiple studies state that upselling works 20 times better than cross-selling when strategically placed on product pages.
- During Checkout
You may have noticed supermarkets placing items near the billing counters, like chewing gum, bite-sized chocolates, and magazines. Have you wondered why? The answer is simple – the idea is to persuade customers to make impulsive buys.
Similarly, selling complementary or premium products during checkout is one of the ways to upsell and cross-sell on Shopify. Besides, since it is not distracting, it does not impact your conversion rates.
Popups are relevant even today, and here’s why. The average conversion rate for pop-ups is 11.09, and cart abandonment pop-ups have a conversion rate of around 17.12%.
Pop-ups are also an effective way to introduce new offers or a new product and remind shoppers about limited-time deals. Pop-ups are attention-grabbing, invoke a sense of urgency, and prompt buyers to take action.
- Chatbots or Customer Service
You can upsell or cross-sell when your customers interact with an automated chatbot or a human customer service executive on the phone. However, this approach is only effective if your Shopify store has a live chat feature.
Upsell vs. Cross-sell – Who Wins?
In the upsell vs. cross-sell battle, both strategies come out as winners. In today’s competitive landscape, it is impossible to overlook either of these selling techniques to ensure your Shopify store is flourishing. If there is anything we have learned so far, it is that both upselling and cross-selling are powerful strategies that can help Shopify businesses grow.
With data at your disposal, it is a good time to ditch the guesswork and create selling strategies that draw results. While revenue generation is one of the objectives of developing upselling and cross-selling strategies, business owners should ensure they add value to every purchase their customers make.
The secret behind the success of the best Shopify stores is a blend of excellent customer service, deployment of timely and relevant upselling and cross-selling strategies, and seamless post-sales services.
If you are a Shopify merchant who has yet to knock on the doors of upselling or cross-selling, now is a good time to start.
Frequently Asked Questions on Upsell.vs Cross-sell
What is the main difference between upselling and cross-selling?
The fundamental difference between upselling vs. cross-selling is that upselling aims to increase the value of a single purchase, and cross-selling aims to increase the number of product purchases.
Can upselling and cross-selling be used in both online and offline businesses?
Yes, upselling and cross-selling can be effectively used in both online and offline businesses. Brands, including Mcdonald’s and Apple, have built their reputation through online and offline upselling and cross-selling.
Are there any ethical concerns regarding upselling and cross-selling?
Yes, there are a few ethical concerns linked with upselling and cross-selling. Some include misleading customers about the benefits and pricing of certain products, scamming shoppers, selling customer information, violating customer privacy by coercing them to buy from your online store, and more.
How can I measure the success of my upselling and cross-selling efforts?
The most prominent metrics used to measure the success of upselling and cross-selling efforts include average order value (AOV), customer satisfaction (CSAT), net promoter score (NPS), and customer lifetime value (CLV), to name a few.
What are some future trends in upselling and cross-selling?
Some of the future trends in upselling and cross-selling include omnichannel upselling, AI integration and personalization, subscription-based upselling, ethical upselling, and voice commerce.