It鈥檚 a mistake to assume that a customer鈥檚 revenue potential ends after their order. There are so many opportunities during and after the initial purchase. Cross-selling unlocks a lot of those opportunities for extra revenue 鈥� and increased customer satisfaction.
I鈥檝e worked in sales and marketing enough to contribute to numerous cross-selling campaigns. I鈥檝e witnessed firsthand its profound impact on companies鈥� revenues and customer relationships. And it鈥檚 not just my perception.
that cross-selling can increase sales and profits by 20% and 30%, respectively. Furthermore, 探花精选 research from 2023 includes a survey of more than 1,400 sales professionals across North America, Europe, and Asia. They found that cross-selling accounts for 21% of their organizations鈥� revenues, on average.
In this guide, I鈥檒l break down cross-selling as a sales tactic, highlighting how it works, its benefits, and its challenges. I鈥檒l also share some proven cross-selling strategies you can implement today to start driving revenue growth.
In total, here鈥檚 what you鈥檒l learn:
Table of Contents
Here鈥檚 another example of cross-selling. If a customer has already purchased a subscription to your marketing newsletter, you could cross-sell by encouraging them to purchase a subscription to your since most digital marketers could make use of it.
To start a cross-selling strategy, I first identify products that satisfy additional or complementary needs not fulfilled by the initial purchase 鈥� or that increase its value or utility. Next, I encourage the customer to purchase these additional products.
Cross-selling opportunities are available at various points of the sales process. For example, some of my favorite places to cross-sell are product pages, checkout pages, thank you pages, and post-purchase emails.
Everyone鈥檚 doing it. 探花精选 research reveals that 90% of surveyed salespeople try to upsell customers and prospects during the sales process.
Cross-selling and upselling are sometimes used interchangeably, but the approaches are quite different.
While cross-selling involves offering customers additional related items, upselling involves offering them an upgraded, more expensive version of the product they selected. To upsell, you need to convince the customer that the higher-priced version is worth it.
Returning to the customer who just ordered a burger: To upsell, I鈥檇 offer options to create a more elaborate burger 鈥� adding pickles and cheese slices, let鈥檚 say 鈥� for an additional fee.
You鈥檒l notice that cross-selling adds to a sale via additional, lateral products that complement the original purchase. In contrast, upselling enhances the original product by offering an upgraded or feature-rich version.
Here are a few realistic scenarios highlighting the difference between cross-selling and upselling.
Mobile Phone Retailer
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Project Management Software Provider
Air Conditioning Sales
Cross-selling provides numerous benefits when executed properly. Here are the main perks, as I鈥檝e personally discovered.
The most direct and immediate benefit of cross-selling is an increase in sales revenue. , the typical odds of closing a sale are 60-70% with an existing customer. That鈥檚 in contrast to 5-20% with a new one.
More specifically, encouraging customers to buy complementary products typically boosts the average order value (AOV). A higher AOV means higher overall sales from my current customer base, which can reduce the need to constantly acquire new customers.
One of the biggest benefits I鈥檝e seen while cross-selling is it helps me maximize customer lifetime value (CLV), which is the total revenue generated from each customer over the course of their relationship with my business.
I鈥檝e found that when customers perceive my business consistently meets their needs via relevant product suggestions, they鈥檙e more likely to develop loyalty and trust. This encourages more purchases over time, meaning a higher CLV 鈥� meaning more long-term revenue.
As a sales technique, cross-selling relies on products that enhance the overall utility, enjoyment, or longevity of the primary buy. A customer who just bought their first camera from me will probably benefit additionally from a tripod and a camera bag. Having those extra products will make their overall experience more satisfying.
When I鈥檓 a customer, discovering relevant offerings via expert cross-selling is a pleasant surprise that makes me feel more understood and appreciated by the business. If there鈥檚 one thing I know, a smooth and satisfying shopping experience breeds customer loyalty.
Cross-selling involves strategically placing related products in the customer鈥檚 line of sight during their purchasing journey 鈥� products they might not have been aware of. From impulse buys to newbies experimenting, I鈥檓 able to get more purchases this way.
Like any other sales tactic, cross-selling comes with some hurdles.
A pitfall I often see is annoying the customers. The line between making a helpful suggestion and unsolicited nagging is very thin.
To avoid this, what I do is closely observe customer reactions and engagement levels during the interaction. If I sense any hesitation or disinterest, I immediately ease off the pressure.
If my customers feel like every transaction is an attempt to sell them something more, they are more likely to view my business as purely profit-driven. This would damage their trust in the brand and reduce the likelihood of future engagement.
Another disadvantage is that cross-selling can ironically be less profitable 鈥� even when used successfully.
A found that the costs of cross-selling to certain 鈥減roblem customers" 鈥� such as people who frequently return products, overuse customer support, and primarily avoid regularly priced items 鈥� can actually overshadow extra revenue generated from them.
This is an issue because these types of customers account for as much as 70% of the average company鈥檚 customer loss (which is when the cost of goods and marketing exceeds the revenue generated).
To overcome this problem, Harvard suggests thoroughly examining your business practices, identifying any that may unintentionally attract or encourage problem customers, and making adjustments.
Additionally, analyzing each customer鈥檚 transaction data can help determine whether they fall into one of the problematic categories. Depending on what I find out, I tweak my sales strategies, like upselling them instead or choosing to focus on other customers.
While cross-selling is a legitimate practice, you still need to approach it with caution. Here are a few guidelines I follow to stay within ethical boundaries.
When cross-selling, the focus should always be on the customers and their needs. Don鈥檛 cross-sell just for the sake of it 鈥� make sure that every recommendation genuinely adds value to the customer's purchase. , president and head of marketing at Method Q, says:
鈥淚f the cross-sell products/services bring additional value and enrich the customer outcomes, then it is less 鈥�selling鈥� and more 鈥�solving.鈥� The focus should be on what the customer benefits from, not what the salesperson needs to sell.鈥�
I鈥檓 sure you鈥檒l agree with me: There鈥檚 nothing more annoying than a sales rep trying to sell you a product you鈥檙e clearly not interested in. Always respect your customers鈥� decisions when they decline cross-selling offers.
Whenever I鈥檓 cross-selling, I look for any verbal and nonverbal cues that indicate disinterest or discomfort. If I start a pitch but realize the customer isn鈥檛 receptive, I switch my focus to delivering excellent service and building rapport. This approach paves the way for future cross-selling opportunities based on trust and mutual respect.
When taking advantage of a cross-selling opportunity, be transparent about the situational value of the product. Don鈥檛 say that a product does more than it does. If there are limitations or drawbacks associated with the additional product, mention them and offer workarounds.
As business development manager explains, being transparent about the value and costs of additional products 鈥渂uilds trust and helps establish a long-term relationship with the customer, which is far more valuable than a one-time sale.鈥�
Stay in touch with your customers consistently throughout the year, not just when there鈥檚 an opportunity to cross-sell. , CMO at Invisory, explains the importance of maintaining long-term engagement:
鈥淚f your customer only hears from you during renewal season, you鈥檒l come off as shallow and money-driven. If you continue a fairly steady beat of sharing content 鈥� you won鈥檛 seem as desperate.鈥�
Effective cross-selling begins with thorough preparation. Specifically, you must take time to learn about your customers and map out their buying journey. Honing your listening and analytical skills will take you far. Let鈥檚 dig a little deeper into that.
You may already know about buyer personas. It鈥檚 important to get to know your audience after they have purchased your product, too, because their needs and expectations may evolve significantly after the purchase. To keep up, you鈥檒l need to understand customers鈥� goals and challenges.
The goal is to use demographic and psychographic information 鈥� along with direct 鈥� to create updated personas for post-purchase customers.
You can leverage to easily deploy, manage, and gather data from customer feedback surveys. It鈥檚 also useful to get additional insights regarding your audience鈥檚 main pain points by learning how customers interact with your knowledge bases and service agents, for instance.
I鈥檝e found that taking time to get to know my audience helps me identify not only which cross-sell products are most likely to appeal to them, but also how to communicate the offers in a way that resonates.
The customer journey refers to the path a person is most likely to take from initial awareness of your brand to purchase and beyond.
According to 2023 探花精选 research, 31% of sales reps who cross-sell said mapping out the customer鈥檚 journey is one of the most effective cross-selling strategies.
Cross-selling can happen at any point in the customer's journey 鈥� it鈥檚 just easier to cross-sell at some points than others.
Mapping the customer鈥檚 journey helps me identify the sweet spots of cross-selling.
For example, I find that customers are most receptive to my cross-selling pitches after they鈥檝e seen results from my products. Plus, they鈥檒l naturally talk to other people about it, potentially driving referrals.
Become an expert on your entire product range. Identify each offering鈥檚 respective strengths and weaknesses. How do they address specific customer needs? Most importantly, learn how different items complement one another.
If I tried cross-selling without comprehensive knowledge and understanding of my products, I鈥檇 risk suggesting combinations that don鈥檛 make sense to the customer and don鈥檛 bring any value. That would erode customer trust by leading them to believe that my primary goal is to increase sales rather than meet their needs.
In contrast, since I thoroughly understand how my products interconnect, I鈥檓 able to make informed recommendations that genuinely enhance the customer鈥檚 initial order.
Sometimes, opportunities to cross-sell can arise unexpectedly, such as during an unrelated phone call or email exchange with a client. Therefore, another move I recommend is identifying receptive signals from customers. This involves active listening.
For example, when speaking with customers, I pay close attention to their voice and tone. It provides insight into their emotional state and readiness to engage.
I鈥檝e also discovered that what a customer 诲辞别蝉苍鈥檛 say explicitly can be as telling as what they do say. Pauses, hesitations, and indirect comments can all provide clues for areas where your products or services can offer additional value or support.
I like to encourage dialogue by asking customers open-ended questions instead of yes or no questions. This gathers more information by letting people express their needs and concerns fully, which in turn creates a fertile ground for discovering opportunities to serve them even better.
Now that you know how to prepare for cross-selling, let鈥檚 explore a few top strategies to use once you鈥檙e ready. These are tactics I鈥檝e personally used with tremendous success.
According to , 71% of modern customers expect brands to deliver a personalized experience 鈥� with up to 76% of people expressing frustration when that 诲辞别蝉苍鈥檛 happen.
When it comes to cross-selling, ensure that you tailor your recommendations to each customer based on their preferences, purchase history, and behavior.
Data analytics tools and AI have made that much easier to do. In fact, 探花精选 research reveals that 30% of U.S. salespeople say one of their top three cross-selling strategies is leveraging AI to suggest the right products and services to customers at the right time.
A here also helps store relevant customer details that can reveal tailored cross-selling opportunities, like previous purchases, deal amounts, and so on.
Personalized cross-sales make your clients feel understood and appreciated by your business, which increases the likelihood of acceptance. But don鈥檛 just take my word for it.
, CEO and founder of Candida Diet, tells us that sending automated, personalized product suggestions to customers (based on their initial purchases) is one of their most successful cross-selling strategies.
鈥淧aying customers who received our personalized recommendations were 37% more likely to add at least one additional product to their basket and 25% more likely to increase their average order value.
Richards further notes that these customers typically return to make subsequent purchases more frequently than general website visitors. The result is an impressive 12% more customer lifetime value from those who get personalized product recommendations.
探花精选 research from 2023 shows that 37% of U.S. sales reps who cross-sell cite offering discounts and promotions as one of their top three effective cross-selling techniques.
Furthermore, indicates that 82% of online shoppers are more likely to complete a purchase if they have a discount code and coupon. Who鈥檚 surprised? Everyone loves a discount.
Make sure to highlight the cost-saving benefit of your promotional offers or discounts. More importantly, emphasize how the add-on product enhances the customer鈥檚 experience and provides extra value.
Create special packages and bundles that combine the principal product with complementary items. Consider making the bundle cheaper than ordering items separately.
Another thing I like to do is position the bundle as a special offer available only to customers who buy a particular primary product. I've found that this often provides an extra incentive for customers to take advantage of the bundle.
According to 探花精选 research, 30% of salespeople who cross-sell said that offering bundles was one of their top three cross-selling strategies.
Typically, the higher the discount on bundles, the higher the likelihood a customer will accept it. A research study appearing in the found that if a discount is only 20%, customers still prefer to buy individual products. If it鈥檚 45% or higher, the preference for bundles is higher than for individual products.
Another great cross-selling strategy, particularly for ecommerce businesses, is to show products that other customers frequently buy alongside the main item.
When your customers see that others who bought one item also bought additional items, they鈥檒l naturally hypothesize why it鈥檚 the case. If they determine the additional product has relevant value, they鈥檒l probably add it to their purchase as well.
The key to keeping your cross-selling efforts sharp is to constantly monitor and analyze your performance. Personally, I track metrics like conversion rate, average order value, and customer satisfaction. Google Analytics helps me here.
Once I have that data, I analyze it to identify patterns and areas for enhancement. From there, it鈥檚 a matter of brainstorming ways to fine-tune my cross-selling tactics and optimize my offers.
Even when your current strategies are doing well, there鈥檚 room for improvement. Test different offers, messaging, placements, and bundles to see if there are more effective combinations.
Personally, I conduct A/B testing to measure the impact of variations and iterate based on my findings.
Another cross-selling strategy I鈥檝e found to be effective is using social proof to build confidence and trust in my offers. Display ratings, reviews, and testimonials from satisfied customers who have benefited from complementary products.
This increases the perceived quality and usefulness of the product, which will boost your customers鈥� willingness to accept the cross-sale. The found that displaying reviews can increase a customer鈥檚 likelihood of buying a product by up to 270%.
Empower your sales and marketing teams with the knowledge and tools to maximize cross-selling opportunities. This includes providing comprehensive training sessions that focus on understanding customer needs, product knowledge, and effective communication.
Additionally, offer ongoing support and feedback to help your team refine their cross-selling approaches.
When I work with a sales team, I like to give them some autonomy within established guidelines. This allows them to personalize their approach to cross-selling, which I've found leads to more authentic interactions with customers, increasing the likelihood of success.
Everyone wins when you execute cross-selling effectively. You increase your brand鈥檚 bottom line, and your customers get solutions that better address their expectations and ideals.
Sure, it requires a strategic and nuanced approach, but you have all the information needed to start. Stay in tune with how your customers feel, learn which features or products will benefit them the most, and calculate the perfect timing to introduce an extra offer.
Oh, and stay patient until your cross-selling efforts thrive.
Editor's note: This post was originally published in October 2018 and has been updated for comprehensiveness.