Upselling is a sales technique designed to increase the sales invoice. It’s an important business concept as it requires sales people to not be order takers, but instead be active sellers. Upselling involves promoting upgrades or add-ons to customers that are extra purchases and increase sales. When you upsell you offer the customer another product for purchase.
As the customer wasn’t planning on purchasing the product, but instead is ready to pay only for what they’ve already decided on, the salesperson must use effective strategy. It’s up to the salesperson to make the customer see why he or she needs to buy the extra item(s) immediately. The reason that strategy is everything in upselling, is that without it, asking the customer to buy more than planned just comes across as a high pressure sales tactic.
Incentives are crucial features of upselling. Incentives such as a discount and/or free shipping give the customer good reasons to purchase something extra right away. For example, the "buy one, get one" (BOGO) incentive works well to increase sales in many industries such as fast food and fashion accessories, whether the offer is to get the second item for 50% off or for free. Free shipping is often a good way for web-based retailers, or "e-tailers," to encourage consumers to buy extra items, such as by offering free shipping on all orders that total a certain minimum amount.
In addition to offering incentives, pointing out the benefits can also help convince a customer to add more onto their original order. For example, will buying one or two extra items now save a substantial amount of money on high repair costs sure to occur down the road? Or does bulk buying now allow not only for a lower price, but also the convenience of not having to re-order so often?
Understanding the customer and the psychology behind buying additional items is essential to effective upselling. Do the math and give the customer the exact amount of money he or she would be saving by buying now rather than waiting. Show him or her why that represents a significant savings that can't be put off. Whatever your incentive offer is or whatever the particular benefits to buying extra now are, show the exact details of these to your customer. Above all, when planning your upselling strategy, think about your customers and what exactly would make them want to add on to their planned order.
