Mark Antony | 6 min read
A business will always try to sell their products to potential customers by offering them add-ons or additional services. However, while they do that, they also charge additional money for that extra product or service in order to sell it to their customers. The customer, on the other hand, will pay more attention to the additional amenities rather than focusing on the price. In business terms, this is known as upselling.
For many businesses, upselling is their lifeline. A lot of the companies even end up selling certain products or services at a loss, as long as they upsell in the future. Now, there are certain companies and businesses that include additional amenities with their products or services, and that too at a reasonable price. However, how can one differentiate between the ones who are fairly priced and the ones who are just taking advantage of the customer’s wallet? Keep on reading to find out.
What Exactly Is Upselling?
Now before we get into details of how you can avoid businesses that are trying to upsell, you need to understand what upselling is exactly and how does it impact everyone? Firstly, upselling means that a business is trying to get their customer to make additional purchases than they originally wanted to.
Certain businesses believe that upselling to their current customers is actually five to ten times cheaper than getting new ones. That is why businesses will offer their current customers extra add-ons right when the customer is making their purchase. The customer trusts the company since they already bought from them; hence they wouldn’t mind spending the extra pounds or dollars just so they can get some additional benefits. This is how businesses trick customers into spending more of their money.
“The probability of selling to a new prospect is 5%-20%. The probability of selling to an existing customer is 60-70%.” - from the book "Marketing Metrics"
Listed below are some of the tactics that the majority of the companies use when it comes to upselling. The more you know how these companies operate, the better you will be able to stay away from them.
They Try To Make The Upsell Relevant To The Original Purchase Of The Customer
When you visit any fast food place and order a burger, the cashier will always ask you if you want extra fries or a drink. Why do they do that? Because they know that fries go well with a burger and of course the customer will always say ‘yes’. The upsell is relevant to what you originally purchased.
If a business wants their upselling to be successful, they need to keep up this relevant tactic. Therefore, the business will always want to showcase additional amenities with their product or service in order to improve that product in front of the customer’s eyes. Moreover, customers need to stay alert when it comes to companies trying to persuade them to buy extra things with their original purchases. Listed below are the examples of some random products and the additional item that can improve the use or look of that product.
- If a company is selling a knife, then they will add and sell a knife sharpener as well.
- If a company sells a certain software, they will sell additional premium support with it.
- If a company is selling sunglasses, they will recommend buying a microfibre cleaning cloth with it.
They Would Try To Offer Extra Stuff In Discounted Prices
Customers can sometimes easily recognize an upsell. There is only one thing customers look for when they notice the upsell, and that is how much will it cost them? There is no way a customer will want to buy additional items with their original purchase if it costs them just as much as what they originally bought. That is why, companies oftentimes offer extra amenities in discounted rates, so that they can lure in the customer for another purchase.
For instance, companies try to offer the extra stuff for either half of the cost than the original product or even lesser than half price. This will make the customer think that they have already purchased the main item that they wanted, what’s the harm in spending a couple more pounds or dollars for some extra amenities. If you do that, then you have fallen into the company’s upsell trap!
They Would Try To Make The Upsell Once You Have Bought Your Original Product Or Service
In order to encourage their customers to spend more money, companies would try to make the upsell after the customer has made a purchase. They would lure them in with additional items or services that goes well with what they originally bought. Mostly people buy whatever they need online nowadays. So, when a company is trying to upsell after the customer’s original purchase, they would make things easier for them by letting them know that they don’t have to enter their payment information twice if they decide to buy any additional item. This is just another tactic companies use in order to make the customer spend more of their money.
They Would Try To Sell Something That Solves A Potential Problem
As mentioned before, companies try to incorporate relevant items with the original products that they are selling. When they sell their product, they know that customers will need something to help solve an issue that they might experience with the product. For example, a company that sells mobile phones is aware of the fact that phones are fragile and need protection. Hence, they will try to sell mobile phone covers in numerous designs and colors in order to appeal to the customer who just bought a mobile phone from them.
Moreover, if they are selling the product on an online store then they will try to advertise the product using persuading phrases such as ‘Customers Who Bought This Item Also Bought’ or ‘Frequently Bought Together.’ Then the customer will start thinking about the purchase they just made and if they should get that extra thing for the product they just bought.
Conclusion
In the end, companies can use all the tactics in the world when it comes to upselling, but it is up to you to be aware of these tactics and not to fall for them. As mentioned above, some companies are truly looking for the benefit of their customers when they include additional amenities with their products or services and that too at reasonable prices. However, it can be difficult to differentiate between the two due to the persuading nature and marketing tactics used by these companies. With us, you don’t have to worry about any upselling fiasco. We are always honest with our customers since their satisfaction is our number one priority.
Ultimately, it boils down to this: You are the king. Make sure that sellers know what exactly you want. That generally leads to happier customers too.
Fending Off the Upsell
Here are four quick ways to fend off eager salespeople who are doing a rote upsell for some product or service with little value for you:
1. Know the upsell is coming:
Simply knowing you are in an upselling zone will help you be on your toes and avoid reflexively agreeing to purchases you might not need to make. .
2. Resist assumptions:
The best defense here is to understand the gambit and sidestep it. For example, rather than agreeing that ultraviolet rays are destructive to the paint, you can counter by saying, "Thanks, but I always keep my car in a garage."
3. Don't give in to guilt:
Don't let guilt motivate you to buy something you don't need. It helps to remember that salespeople may think highly of a particular service or product because it will make them more money.
4. Be ready for follow-up pitches:
Just because you said no once doesn't mean you won't be tested again. Good salespeople always try to overcome your objections. If necessary, it's OK to fall back on vague responses such as, "I'm not interested at this time." Then, you aren't trying to reject the products and services. You're only saying that you don't want them now.
Terminology
Upsell: An upsell is when you persuade a customer to buy something extra or more expensive. You’ve been up-sold when you visit a car dealership to buy a Toyota and end up buying a Ferrari.
Cross-sell: A cross-sell is when you sell a different product or service to a customer. When a restaurant waiter asks you if you’d like a Coke with your fries, or fries with your burger, that’s a cross-sell.
Cross-sells work well with lower-priced items. When buying an iPad, you might be tempted to buy a case, too. But it may not work the other way around.
In the graph below, you can see that upselling drives more than 4.0% of online sales, while cross-sells earn a mere 0.2%
Bundle sale: A bundle sale is when you group different items together and sell them at a lower price than what they would have sold for separately.
Please feel free to share in the comments below your personal experience about other unfair upsell practices.
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