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Paul Farris’s book, Marketing Metrics, confirms that “Brands have a 60-70% chance of selling to an existing customer, while the chance of selling to a new customer is only 5-20%”. This highlights the importance of providing a delightful customer experience to retain existing customers. One of the best ways to do so is to apply a robust cross selling strategy.
What is cross selling?
Cross-selling is a sales technique which involves selling supplementary and related products and services based on the item that a customer is in the process of purchasing.
For example, a laptop protector could be sold to a consumer who is already about to purchase a laptop. Credit cards can be cross-sold to a person who is registering for a bank account and life insurance can be cross-sold to a person who is considering car insurance.
Cross sell vs. up sell
Upselling and cross selling in the retail industry are often used interchangeably but, they’re fundamentally tactics to increase basket size.
Upselling is the technique of suggesting a premium version of the product that a customer is considering purchasing. A good example is when a customer plans to purchase a laptop and the salesperson suggests a different model with better features at a slightly higher price.
Cross-selling, on the other hand, is when a salesperson suggests a laptop bag which goes well with the new laptop.
Learn from the top brands
Fast food restaurants have mastered the art of this strategy – the most well-known example of this is McDonalds who uses both cross selling and up selling for its meals so effectively that most customers don’t even notice it.
Here are some other companies that you might not be aware of who use the same cross-selling techniques:
Walmart’s when we don’t have a history
Walmart.com did an amazing job of this cross selling tactic, even when they do not have much data about their visitors. When you shop on Walmart’s website, you will see recommendations which are aptly called “other customers also bought”. Through these recommendations, customers are given a series of products that are complementary to their initial purchase.
GoDaddy’s add on items
GoDaddy is one of the world’s largest Internet domain registrars and web hosting companies. The main line of business for GoDaddy is selling internet domains. The brand effectively applies its strategy by showing a variety of services that customers can also purchase – such as web hosting, website protection, and privacy protection.
Amazon’s frequently bought together
Amazon’s strategic approach to cross-selling has catapulted the brand to become one of the biggest companies in the world. The feature, known as “frequently bought together,” and the popular “wish list” have made cross-selling almost indistinguishable elements of the customer experience. Amazon understands the process of personalisation and makes sure to show items that relate to its customers’ needs.
Whether you book flights on American Airlines or Virgin Atlantic, you will most certainly encounter several cross selling strategies along the way. Many airlines offer the upsell of more legroom at a slightly higher price. Cross-sells vary and can include car hires, hotel rooms and travel insurance. By inconspicuously adding these items, many airlines enjoy a substantial increase in revenue as well as providing a convenient experience that meets their customers’ needs.
Dollar Shave Club’s follow up
Email marketing is one of the best ways to cross-sell to existing customers. Automated emails can be triggered by customer behaviour (such as completing a purchase). Dollar Shave Club does this well by sending customers an email detailing the items that are about to be shipped. It also includes other items that customers may be interested in adding to their existing order.
Every cable company’s bundling packages
Telcos have long and established cross selling tactics which they perform by bundling telephone, cable and internet connections as fully packaged solutions for people’s in-home communications and entertainment needs.
Smart insurance agents
When it comes to insurance, most consumers would rather contact their trusted insurance agent to handle the details of their purchase. Smart insurance agents are trained to cross-sell by recommending products and offering discounts for bundled services. For example, car insurance can be bundled with home, pet and travel insurance. With bundling, customers no longer have to deal with the long process of purchasing multiple insurance policies and can, instead, have all of their requirements met from a single provider.
When is the best time to cross sell?
How and when a brand should cross sell depends on its customer’s history and buying behaviour. By analysing sales data, customer insights and overall behaviour, brands are able to offer customers the right items at the right time.
So, when’s the best time to hit people with a cross sell?
- Cross sell at the check out page – most businesses will opt to cross sell when a customer is about to check out. This is a good time to offer a cross sale. When customers are about to complete the purchase, you can offer them related products that will improve their experience when combined with the product they are about to purchase.
- When they have already completed the purchase – If you don’t want to clutter the user’s experience and are mindful of bombarding them with too many offers while they are checking out, another good way to cross sell is on the thank you (purchase confirmation) page. This way, you are not only grabbing your customer’s attention, but while they still have their credit card within reach you can start offering them similar products. The thank you page is the most overlooked and under-used opportunity for a cross sell but can deliver great results.
- Retargeting – advertisements are another excellent way to cross sell a product to existing customers. Brands can re-target customers who have recently completed a purchase by using the Facebook re-targeting pixel to show related products to their recent purchase.
- When customers re-visit your website – Using website personalisation tools such as VMO, you can cross-sell to your customers based on what they last purchased on your site.
Finding new customers is expensive and time-consuming. The Digital Index Loyal Shoppers Report from Adobe shared,,”An average shopper will spend 17% more during holidays, but a repeat customer will spend 25% more”. A timely and relevant selling strategy to existing customers is a smart tactic to increase customer lifetime value and encourage customer loyalty over-time.