Show notes
If you want to increase revenue, upselling and cross-selling can help. So what’s the difference? Upselling means selling a better or a higher priced version of the thing that they’re looking at. Whereas cross-selling is making a recommendation of something that’s compatible.
David: Hi, and welcome to the podcast. In today’s episode, co-host Jay McFarland and I will be discussing the topic of upselling and cross-selling. Are you doing it? Welcome back, Jay
Jay: Yeah, hey, thank you, David. Listen, have these bad memories when I was a kid and I was working in a fast food place and the manager was always pressing me, “ask them if they want a Coke, ask them if they want fries.”
And I got to a point where it’s hard to upsell and I think this has grown into my adulthood. You know, I just barely got the sale and now I’m asking them for more. It’s not an easy thing to do for people.
David: You know, it’s interesting you should mention the fast food example because it’s the perfect example. It’s the one that everyone can relate to. “You want fries with that?”
Jay: Yeah.
David: Or the shortened version that you hear a lot of times, “want fries with that,” as the four word upsell. And it works extremely successfully for people in that sort of industry. Because it makes sense. Somebody’s coming in, they’re ordering whatever, a burger or something, or they’re ordering a burger and a drink, “want fries with that” makes perfect sense.
And some percentage of time they’re going to say yes. And whether that is 1% of the time or 80% of the time, it’s probably maybe 30 to 60% of the time, I would guess, they’re going to say yes. Because it’s like, “oh, all right, sure. Why not? I’m already here.”
Jay: Yeah.
David: And you hit on a great point, which is that we can feel funny about upselling, if we feel like the purpose is to simply get more money out of a person. If it feels like it’s completely one-sided, if it feels like it’s manipulative, then we’re not going to want to do it.
So I personally believe that the times that we should upsell and cross-sell are the times when we truly believe that we have an additional solution that is going to be better for them.
Now, in the fast food example, are french fries better for you on top of the Coke and the hamburger?
Jay: Yes!
David: Probably not from a, health level, but certainly from a satisfaction level, yeah, it’s better. People are likely to want that. But in business, if you’re selling something, and somebody comes to you and they have something very specific they want to buy, and you have something that would be complimentary to that, or something that would go with that really well and would increase the value to the buyer, then you kind of owe it to them to at least ask them if they’re interested in that.
Jay: Mm, I love that. I love that idea that if you are feeling uncomfortable, maybe you should ask yourself why. And how do you feel about your product? Are you really providing a value to them or are you just trying to sell something and get a paycheck, right?
And I think we all have to ask that question about our own careers and what we’re doing and what we’re selling. But, you know, if you can just feel great that what you’re providing them is going to improve their situation, then you’re just passionate about what you’re doing and that’s going to come through.
David: Yeah. So when you are talking to somebody like that, if you’ve got something that is actually going to be a benefit to them, if it’s going to help them, then it’s a lot easier to do it. So that really just boils down to motives.
What is the motive? And unfortunately, I think sometimes managers, like in the situation you described in the fast food restaurant, the manager says, “just do this. Ask them if they want this. Push it, push it, push it. Sell, sell, sell.”
When instead, if the manager had said to you, Hey, listen, when people come in here, they’re hungry. They want something good. You know, they’ve ordered this, they’ve ordered that other thing, so they might want it and maybe they didn’t think of it.
You might want to suggest that. Maybe they want dessert, maybe they want an apple pie at the end, right?
Jay: Mm-hmm.
David: Apple pie. I’m saying yes to an apple pie, right? And if you don’t ask, you don’t get, and it’s very easy for them to say no. Now, there are situations, and I’ve heard it referred to, particularly in online situations, where there are online upsells where you buy something and then it asks you if you want to buy this and you want to buy that and you want to buy this.
Yeah, I’ve heard people refer to that as upsell hell. Now, if you get somebody involved in that, then that’s not good. But if you make a recommendation that makes sense for them, then I think there’s absolutely nothing wrong with that.
Jay: Yeah, absolutely. I also have heard this, you know, back to the fast food example, when the person who’s embarrassed to do it, they say, my manager wants me to ask you if you, and I’m like, oh, that’s just the worst situation.
But I think, you know, I’ve also had like servers say, ” you should try this because it’s really good.”
David: Yeah.
Jay: And that’s different, right? That doesn’t sound like an upsell. That doesn’t feel like an upsell. So how you go about it, and are you passionate about it? Do you really believe that?
David: Right.
Jay: That makes all the difference.
David: When my son was traveling, he was in Italy with some of his friends and they went out for dinner one night and they went into this restaurant and the waiter was very happy to see them. Americans there to spend money, and the waiter came over to take for order and one of the guys ordered chicken and he said, “no, no, no, no. You don’t want the chicken. It’s terrible here, get the steak,” right?
Now there’s an example of an upsell, I guess.
Jay: Yeah,
David: Upsold them from the chicken to the steak. The steak was a lot more expensive. Was the chicken there really terrible? I have no idea. But he presented it in a way that made them think, all right, I’ll get the steak.
And it was entertaining, too. So I think there are ways of engaging in this type of behavior where if it’s not manipulative, and it actually gets them a better result than you might as well do it.
You know, another thing I think that people should consider is that when it comes to upsells and cross cells, it’s not something that always just has to take place at the immediate point of purchase.
I mean, obviously that’s a great time to do it, but if someone buys something from you… in the promotional products industry, I mean the, examples are kind of easy. Somebody buys t-shirts or sweatshirts, “want caps with that,” right? Would be the equivalent of french fries.
And you can ask and they can say yes or they can say no, whatever it is. But if you don’t do it at the point of sale, you could contact them back maybe a few weeks, a month later. Hey, I just wanted to let you know we just got this new product in. I think it would go perfectly with those shirts you got.
Would you be interested in having a look at that? Right? And that’s an example of an upsell or a cross-sell that could take place later. So it’s not like, If you didn’t do it the first time, you can never do it again. There are plenty of opportunities to do that throughout the sales cycle.
Jay: Yeah, I agree. And the other thing, I’ve seen some research and it’s something that I’ve implemented that has helped me get over the upsell thing, is that research that I’ve seen shows that the time when people are most willing to spend more with you is when they just spent with you. And that seems counterintuitive, right?
Like, I just got this money out of you. You just spent money and you’re willing to spend more. That doesn’t feel exactly right.
David: Yeah, but again, if you go back to the fast food example, it does make perfect sense. I’m getting this and I’m getting that. Do I want this too? Yeah, sure, why not? So there is that aspect of it.
Now, outside the fast food example, it might not be quite as obvious and there might not be as much of a connection. But once again, I think if we get beyond the idea of selling product, and we get more into the idea of satisfying the customer, what is the customer looking to get from this experience?
So in a promotional products example, am I looking to buy shirts? Not so much. I’m looking to buy awareness of my business. Maybe I’m looking to have people wear this thing and have people see it and recognize my business. Perhaps I’m looking for a sense of affinity, that the people who wear it feel good about my company.
So there are very deep things that I could be looking for in this purchase. And so if I’m able to connect my additional recommendations, my upsells and my cross cells to those types of things, the things that motivated them to want to do it in the first place, then they’re going to be a lot more likely to say yes.
But they’re also going to be a lot more likely to appreciate the fact that you thought about what they actually want and you’re trying to deliver it to them.
Jay: Yeah, and then you’re avoiding that salesperson feeling and you’re more like a consultant, as we’ve talked about so many times in these podcasts.
I think the other thing that you have to remember, just from a pure business standpoint, we talk about customer acquisition costs a lot, and if you can upsell somebody, That’s product on top of your initial acquisition cost.
And then if you can cross-sell them, take your existing lead database and cross-sell them into other products, that by far is a better way to do business than constantly having to find new customers and always paying that cost to get those new customers in the door.
David: Yeah, absolutely. One of the other things that we’ve done in our training is also suggesting to salespeople that when they’re recommending a product to the customer, you don’t always have to recommend the lowest priced option.
Now, there are a lot of customers who are like, I just want the cheapest, I want the cheapest thing. But a lot of times the cheapest thing is not the best option. It’s going to fall apart, or the logos are going to rub off, or it’s not going to be the best thing.
So another thing we can do, and this isn’t really related to upselling or cross-selling, but one of the things you can do is you can start out offering something that has a higher value that is a, a better product, a more high-end product, and let them say to you, “no, I want something cheaper.” Right?
Because if you don’t do that, and you’re successful in selling them the cheapest thing, congratulations. You could have had this better sale and the customer could have had a better product.
So that’s, as I said, not directly related to upselling and cross selling, but when you’re thinking in terms of, “well, what would I do or what would I like?”
A lot of times we are more sensitive about other people’s money than they are. And we’re more likely to recommend something that’s cheap, just for the sake of getting the sale, rather than thinking what’s going to serve this person best in terms of what they’re looking to accomplish.
Jay: Yeah, I think that’s a great line, that we’re more concerned about their money than they are. Again, looking at research and looking at our own behavior, I think sometimes we feel that if it costs more, it’s going to be better. If it’s cheap, it’s going to be worse.
So oftentimes charging a premium, or at least giving them that option, makes them feel like they’re getting something of value. And I’ve seen situations where people didn’t sell very much of a product at a really low price point.
So what did they do? Instead of lowering it, they raised it and it actually brought in more sales. There’s a lot of psychology involved in this, but it’s absolutely true and I think the bottom line, if you don’t ask, it’s not going to happen, right?
David: Yeah. And also just to clarify real quickly, because we didn’t do this upfront, when I think in terms of upselling versus cross-selling, what’s the difference? Upselling to me means selling a better or a higher priced version of the thing that they’re looking at. Whereas cross-selling is making a recommendation of something that’s compatible.
So the hamburger to french fries, that would be more of a cross-sell. An upsell would be upselling from a hamburger to a Big Mac, right?
Jay: Mm-hmm.
David: So you’re getting a bigger, better version of the thing that they were looking at. And so again, we’re talking about this in industries where people are selling, not just behind the counter taking orders.
So when you think about that, if somebody is looking at investing in whatever t-shirts, well, maybe they would like to get the heavyweight, hundred percent cotton rather than the promotional weight 50/50.
Maybe they would like to get multiple colors on there, that type of thing. That would be an upsell. Whereas a cross sell would be, you know, want caps, that type of thing.
Jay: Yeah. Yeah. And just talking about promotional products, I can tell a difference when it’s a nice shirt or when it’s just like the cheapest. And so that’s some way that I could use to upsell somebody.
Because if you’re putting your name and your logo on it, and it’s not very good quality, you’re sending a message, right? And so that’s a way that I think you can help people understand that it’s important that they consider those types of things.
David: Yes. And one thing that you will find out for sure is that if you’re selling promotional products and you sell something cheap to a customer and they buy it and it’s not good, they’re not going to blame themselves.
They’re going to say, why did you sell me this shirt? Well, you told me you wanted something cheap. Well, not that cheap. Not so cheap that it is going to be terrible. Oh, I didn’t know. Right? So…
Jay: That goes back to the don’t buy the chicken, it’s terrible. Get the steak. Right?
David: Exactly. Yeah.
Jay: Yeah. Which again, great example, because if I heard that, I’m like, wow, this person cares about me. I’m not thinking, wow, this person wants me to spend more money, right? So it’s all in the attitude and how you convey it.
David: Yeah.
Jay: All right. How do people find out more?
David: Well, you can go to TopSecrets.com/call to schedule a call with myself or my team. We would be happy to walk you through this stuff. If you’re struggling to increase the average value of your orders, if you’re struggling to bring more customers through the door, or you just need somebody to talk to about how to make things better in your business, TopSecrets.com/call, we would love to have that conversation with you.
Jay: Well, and I love our conversations, David. Thank you so much for your time today.
David: Thank you, Jay.
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