Cross-selling strategies for every business
Cross-selling is one of the best ways to increase your revenue from existing customers.
If you implement the following cross-selling strategies in concert with upselling techniques, you could see a significant boost in revenue.
Sometimes, businesses can get stuck on the idea that they always need new customers to boost their bottom line. In fact, it’s much easier and more cost-efficient to focus your revenue-generation efforts on existing customers.
Here are cross-selling strategies you can implement in your business, no matter what industry you’re in or who your customers are.
What is cross-selling?
Cross-selling is the process of offering more products and services to an existing customer in an effort to increase the revenue generated by each transaction. Some good examples are the “customers also bought” or “frequently purchased together” sections that have become standard on most e-commerce sites. These content sections use algorithms to analyze the purchase histories of customers to find related or similar products that the consumer might also be interested in.
Cross-selling has become standard in e-commerce businesses because it is so effective. Amazon has reported that cross-selling is responsible for up to 35% of its revenue.
How to cross-sell effectively
While the theory of cross-selling is simple, it’s not always easy in practice. Like all marketing and sales strategies, you need to make sure your pitch is personalized for different customer segments. Cross-selling is most effective when you are offering products that are highly relevant to your customer.
You don’t have to use a complicated algorithm with the newest artificial intelligence to develop effective cross-selling strategies. All you need to do is:
- Effectively segment your customer base to determine which segments will be most interested in your products and services,
- Offer those products or services to the right customers and
- Make sure you’re cross-selling at the right time.
Segmentation
Segmenting your customers is vital for nearly every marketing and sales strategy. There are as many different ways to segment your customers as data points you have access to. Some of the most common ways to segment customers for cross-selling are:
- Basic information: age, location, sex, gender, income, etc.
- How they found your business
- Last purchase date
- Items or services purchased in a specific time period
- Interests (based on purchases or content downloads)
There are plenty more, but these often give good insights into customer behavior.
Finding the right products
Once you’ve developed your segments, the next step is to determine which product or service categories align with each segment. For example, offering baby bibs to someone who recently bought a crib, or offering a home loan to customers whose demographics match customers who have recently bought a house.
Finding products that match your customers’ needs can require some creative thinking. It’s also important to make sure your sales and marketing team know and understand your product and service offerings, so they can make decisions about cross-selling in their day-to-day jobs.
Cross-selling at the right time
There are plenty of opportunities to cross-sell to your customers. The most popular is right before they make a purchase. For example, the aforementioned “customers also bought” section on e-commerce websites, the products displayed in the checkout line of retail stores and even a fast-food cashier offering fries or a drink along with a meal.
However, you can also cross-sell by offering related, useful products to existing customers that haven’t made a purchase in a while. This strategy works particularly well with new product or service offerings. Find existing customers that will find value in your new products and target those customers first.
Cross-selling can also occur during customer service interactions, especially positive ones. If your customer service team is trained to cross-sell other products, they can help your existing customers get more value from your business. The most important thing to remember with this strategy is to never try and sell to an angry customer, as that could backfire and lead to losing that customer completely.
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