The task of increasing sales is solved using various techniques. Marketers put a lot of effort into studying the issue of demand formation among the population. One of the conclusions they draw so far is that in the face of tough competition, getting new customers is much more difficult than stimulating already existing customers to spend more. The specific technologies of increasing sales include a number of efficient methods among which upselling is one of the most popular. So, what is upselling?
Base Your Upselling Practices on the Psychology of a Customer
The main idea of upselling is that you stimulate customers to spend more by proposing them better alternatives that are more expensive at the same time. This method is based on several basic assumptions:
- if a person has already formed some need, she will make every effort to realize it
- the consumer wants to spend as little money as possible on the desired product but is potentially prepared to spend more
- an individual is more likely to agree to an offer from a trusted seller than will look for a similar product in another store
- when you emphasize the quality assurance of a more expensive product, you make the buyer doubt that the one she has chosen will serve her for a long time. These doubts can be an incentive to purchase a more advanced product
Therefore, you have a chance to increase the number of sales by skillfully offering more advanced alternatives to your customers. On the other hand, by pursuing this goal, you raise their standards of living. You encourage them to buy products of the best quality and with the latest technical characteristics.
Varieties of Upselling Practices
You can reach the tactic goal of increasing sales in a variety of ways:
- Listen carefully to the purchase option picked by a customer and offer a better and more expensive alternative. Point out those qualities and characteristics that make it more beneficial.
- At the moment when the buyer is focused on buying, offer him a larger volume or quantity of goods at a more “economical” price. For example, if you are asked to sell a liter of milk, offer one and a half, but at a price slightly less than 1 + 0.5 bought separately.
Rationale of Discounts for Upselling Practices
Is such a practice of discounts for upselling profitable for a seller? After all, he could sell this milk for more without a discount offer. In fact, it is profitable, because, in order to find another buyer, you need to spend
- financial resources
By selling the product to an existing customer at a slightly lower price, the seller saves time and effort.
Neutralizing Negative Aspects of Upselling
As any other marketing technique, upselling can have negative effects. They appear if you push certain methods to a greater degree than it is needed. In such a case it transforms from a “soft” technique to a “hard” one. In order to escape the negative consequences of upselling, follow the simple advice:
- The price gap between the product that a person is going to buy and the one you offer should not be very large. Therefore, offer an alternative item that is just one step higher on the price line of goods.
- Emphasize your store’s return policy. Try to convince the consumer that if the product does not fit, she can return it and purchase the one she originally planned.
The importance of upselling is determined by the accessibility considerations. The probability that a customer who is ready to purchase something from you will agree to buy something more expensive is quite high. Whereas the probability to find another customer in the near future is less than that. Don’t spend your time on less realistic things if applying your efforts to the more pragmatic ones gives you additional profit.