Cross selling and upselling are terms that get used interchangeably A LOT in the online marketing space which can be confusing for the few businesses that actually need to know what the difference is. So in this article I’m going to give you a full rundown of what the differences are, whether or not they apply to your business, and how you can make more money using both.
Cross selling vs upselling
Cross selling:
Cross selling is offering a follow up product that is completely different from the first product that was purchased
An example of this might be if someone bought fishing reel, offering them a fishing rod
Upselling:
Upselling is offering someone a better version of something they already bought, and only having them pay the difference. It’s essentially just an upgrade on what they already bought
So to keep with the fishing example, if someone bought a fishing reel, offering them a nicer fishing reel as an upgrade to the original one they bought.
This gets really confusing if you’re coming from the ecommerce space into the sales funnel space because in the sales funnel space, the term “upselling” is used to describe what is actually a cross sale. But because most sales funnels don’t use “true” upsells, they use the term differently.
This term really only applies to physical products because there isn’t really a way to use a “true” upsell on a digital product.
The only way to have a better version of a digital product is to have more things inside the product…which means you can just sell the extra things as a cross sell.
Why Are Cross Selling and Upselling Important?
Obviously it wouldn’t be worth learning the difference between upselling and cross selling if they weren’t important to your business growth.
The biggest reason that upselling and cross selling are important is because they help you to quickly increase your Average Order Value and Customer Lifetime Value.
Because these are offers that you’re only making to people who have purchased a product or are about to, the odds are much higher that they are going to say yes.
The simple reason being that in sales the second yes is almost always easier than the first.
If someone has taken the time to learn about your product, go through your entire sales process and get to the point where they see your upsell or cross sell, they are obviously committed to getting the result that your product provides…
Which also means if you have another product that solves a related problem, they’ll probably be committed enough to buy it!
On top of that, you’ve already spent all of the time and energy marketing to them to get them to that purchase point, you might as well see if another product can help them.
Because you can increase your average order value, it allows you to spend more to acquire your customers, which then allows you to speed up how quickly you grow your business!
How to use these in your business
Generally speaking, a cross sell is the easiest thing for a business to implement quickly.
You just need to solve another problem for your customers and you’re on your way to a high conversion rate, but there are some guidelines you can follow to help you nail your product.
Your cross sell should fall into 1 of 3 main categories for the best conversion rates: get your customer a BIGGER result, get your customer a FASTER result or solve the follow up problem.
Here’s what I mean.
The original product you’re selling obviously solves some kind of problem for people, otherwise they wouldn’t buy it.
The first two cross sell categories are based on that original result.
Let’s say your original product helped people lose 5 pound in 2 months.
Your cross sell could be a product that helps them lose 10 pounds in that same 2 months, that’s a BIGGER result in the same amount of time.
Now let’s say your original product helped people cut 10 strokes off their golf game in 3 months.
Your cross sell could be an add on to that product that gets them that same result in only 1 month, that’s the same result FASTER.
Make sense?
Good!
Those two are the easiest for people to wrap their minds around, this last one can be a little tougher though.
This last one is based on the concept of follow up problems…
Like we said earlier, every product solves a problem, but what most people don’t realize is it also CREATES A NEW PROBLEM.
The best example of this is cars…
When you got a car, it solved your problem of transportation, which is great!
But it also created a new problem…
Now that you have a car, you need gas!
Before you had a car, you had absolutely no need for gasoline…
But now you need it all of the time!
That’s a follow up problem
So what follow up problem does your product have?
How could you solve it?
If you can figure that out, you’ll be able to make the best cross sells possible!
The next thing you need to figure out is when to make your offer.
This falls into either pre-purchase upsells or post-purchase upsells.
Pre-purchase literally just means that the offer is made BEFORE the customer inputs their payment information in.
Post -purchase is just the opposite.
In part, your decision on this is going to depend on what your software will allow, in most cases pre-purchase is easier BUT…
The majority of the time, post-purchase is going to convert better!
So if you can do post-purchase, do so.
One of the reasons post-purchase converts so much better its because the customer has a level of trust with you already because they bought something, this is what makes the second sale easier than the first.
Hope you found this useful!
If you want to learn more about using upsells and cross sells inside of sales funnels, make sure to swipe your free copy of my Sales Funnel Mastery Quick Start Guide down below!
