Did you know there are quite effortless and inexpensive ways to increase customer satisfaction, sales, or average order value? Just as Shopify states, First-time buyers are 27% likely to return, but after their second or third purchase, this grows to 54%.
Upselling and cross-selling – What are these?
Upselling means offering a better option. The merchant can recommend the more expensive or premium option compared to the product that the customer has chosen already for the shopping cart. For example, if a company sells jackets, the merchant can recommend alternatives which will withstand more varied weather conditions. The goal is to get the customer to buy the better version recommended instead of the original product or at best the original and the upgraded version.
Cross-selling refers to techniques that encourage the customer to buy products related to an added product in the shopping cart – cross-selling products are not substitutes but rather complementary. If a company sells sneakers, the checkout can recommend customers with shoelaces, running socks, or protective spray. The aim is to provide good customer service to the customer.
By considering important things related to the purchase merchant can enhance customer satisfaction. But as a nice plus the merchant earns more at the same time, a win-win situation.
Before, during, and after the Purchase
Upselling and cross-selling techniques can be performed at any stage of the customers purchase path, before, during, or after. These techniques are not confined to certain channels and methods also vary, e-commerce, emails, text messaging, and many other targeted marketing measures will do just nicely.
Upselling and cross-selling strategies should be planned through the customer journey. How does the customer arrive in the online store? How does the customer navigate in the store? How long does the customers purchasing process usually take? Are the visits several before the actual purchasing decision is made? It is important to consider the right points in the customer journey where upselling and cross-selling measures are worth to be placed. By considering these, the merchant can identify potential locations for recommended products to add value to the customers purchasing process rather than irritate it. Popular options for placements within the online store include recommendations on a product card, checkout, or through various pop-ups.
Upselling and cross-selling measures that work outside of the online store include such as personalized emails. For example, these can include recommendations based on customers past activities and interests. Recommendations can be related to previous purchase history and thus complement products already purchased. For example, if a customer has purchased a party dress, she may be targeted with messages introducing matching shoes and accessories. Alternatively, retailers can recommend products from a specific category that the customer has been interested in, but has not yet made a purchase. For example, a customer may have been watching headphones and as a result, he will receive an email with recommendations of headphones that have been popular among other customers.
In Shopify-store cross-selling techniques are rather convenient to implement. The merchant can add related products on the product page as recommendations. There are also several well-performing apps like Nosto and Klaviyo. These Apps will ease the personalization of the recommendations and messaging.
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In a nutshell, when recommendations are properly implemented your sales will increase. However, the sales are based on the customers and long-term customer satisfaction. A satisfied customer buys more and more often, increasing the average order value the customer lifetime value. Well-designed recommendations that truly help the customer are a sign of good customer service. The key to increasing customer satisfaction is found in personalized measures based on customer interests and past behaviour. When planning recommendations, it is most important to think about issues from the customer perspective and think about the best ways to help, entertain, and add value for them. Recommendations should never cause anxiety or irritation to the client.
A few tips for the end:
- Personalize and make relevant recommendations. Would you want recommendations on women underwear when you are buying men's suit?
- Surprise your customers with a special extra product! You don't necessarily have to reveal the product you recommend. This way you can change the products more often, and it makes your stock management easier.
- Avoid recommending products that are +25% more expensive than the product customer added to the cart.
- Upselling and cross-selling works especially well in online stores with over 200 products.
Roosa Hämäläinen, growth hacker trainee / Woolman
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