Broadly speaking both upselling and cross-selling deliver the same effect i.e. increased profit.

Generally people require a genuine second person review or suggestion while shopping. And what if the seller himself performs this, in that case the customer would want to entrust even his future shopping assignments to him. A website cannot manifest a human touch, but if a site escorts a customer in his online shopping journey it would profit both sides.

And hence the entire objective of this operation should not just be manifold profit but to make the user’s experience expedient and comfortable.

To understand it better let’s take an illustration: Recommending accessories to pair up with your jeans might not just help you earn more profit by selling more products to the same customer. It will also resolve few hassles in advance which would spring up in the future.

What is Upselling?

Upselling is inducing a customer to purchase a product for which he had not shown any prior buying inclination. However it should not be taken as needless buying. As sometimes consumers do have a need which they do not acknowledge until they are made to.

You can upsell anything – a product, a service or an extended warranty contract (Terms and conditions as they are mostly provided in case of automobiles and electronic goods – it is nothing but an advanced coverage for repairs and periodic service).

Example: Amazon.com. Their persuasive course doesn’t end on completion of a purchase, it actually starts there. And it comprises regular mails with alluring offers and product images to customers. As the customers have already established a trade relation, making a new purchase all the more smooth (only if they had a positive experience).

Companies into direct retail associate bonuses with upselling and cross selling to employees in order to increase their revenue margins.

A few upsell tips that will swell your revenue figures

1. A high end product which gets rejected for its high pricing can fetch a profitable sale if well promoted. The basic trick to upsell is learning about your customer and his background. This will help you figure out the utility-void for your product. If a customer comes looking for a smartphone and you suggest him a television, this foolhardy would not just irritate the customer but demonstrate ruthlessness at the same time. And this will also impact customer’s perception of your brand. A brand that is just bent upon selling products irrespective of its applicableness to the person concerned holds less value. And it would rarely bother about customer concerns after the sale is completed.  On the contrary a brand that takes account of customer clicks and search criteria before making a recommendation is perceived to be smart and stands to gain on account of relevant suggestions. Additionally, knowing customers purpose behind the buying decision will enable you to make more helping recommendations.
2. Do not spin the customer amongst pages. Most of the time customers compare products before buying, and comparison rule implies that comparable products with their specifications share the same screen space. Therefore a customer should be provisioned to view other products alongside his current selection. And this can be worked up by presenting other products from the same category on the same page. Insert either a horizontal or vertical frame to carouse similar products without losing the sight of the selected product.
3. Your suggestion frame should neither be flashy to project a nasty objective nor impede the current selection process. There can be two ways to go about it:

   1. Keep product suggestions at the bottom of the page (above the footer). Here the frame is noticeable even at a glance and at the same time does not obstruct a user in his selection process.
   2. Place the product recommendation after the first conversion step, which happens to be before cart confirmation. This would ensure the first sale and give user a last moment insight into other product range offered.

4. Ecommerce sites usually suggest similar complimentary product options from different brands, that customer did not know existed. Nobody has the time to run over the entire product range displayed by a website. A customer always trims the product list according to his preference criteria. A productive way of recommending products would be – Displaying only the products that fulfill the chosen criteria and explicitly mention it in words. For example if a person comes looking for smartphones having 13 megapixel primary camera.  Additional product recommendations to him should be made based on the same criteria and be worded so – “Other smartphones having 13 mp camera”.
5. Lastly, the only way to convince a customer for buying a more expensive product over his selection is by proving higher returns of the product. Invade the customer’s qualm about durability; nobody would want to buy a product that is irreparable and high maintenance. A refrigerator which is higher in cost but consumes less power being eco-friendly will fetch more savings in the long run than its economic counterpart. Effectively conveying this message to the consumer will coerce him into buying a product that is heavy on the pocket now but will alleviate the burden later. Such deals benefit both the vendor and customer, provided you deliver what you guarantee.

What is Cross selling?

A man goes to a restaurant for lunch. After noting the order waitress asks him politely “Sir would you like to have something to drink with it, we have some fresh seasonal juice you will like”. Cross selling is nothing but proposing additional products from different categories to the customer to up your sale amount.

Effective tips to smartly implement cross selling

1. Couple one product to another for making more sales; most cosmetic companies cross sell using this criteria. A consumer intending to buy a hair shampoo is sold an after-shampoo conditioner emphasizing the need to condition hair after washing them. And since washing is a regular routine activity people do, the profit margin doubles for the manufacturer and retailer.
2. There is a new product people are not aware about. Unless marketed people will never come to know about it. Simply asking the people to buy a new product is not enough for cracking a sale. It requires attractive embellishment to draw visitor attention. For this you can ascribe eye catching discounts to such products. This will fetch it sufficient recognition nearing purchase. You must have seen retail stores flaunting “Buy two and get 40% off”; clubbing discounts can also earn you more. And you can extend it to varied product quantities to provide an offer for everyone. Godfather’s famous lines “Make them an offer they cannot refuse” make the most sense when it comes to devising discount schemes. Various kinds of people visit online stores, some are thrifty while some are ready to spend lavishly. And then there are those that carry a flexible budget, and are ready to stretch it if they are getting a good deal. Consider all these types of people when you plan out your discount options.
   
3. The recommendations you make should be well within the confines of relevance. The products could be from different categories but complementing the selection. If customer adds a pair of formal shoes to his shopping cart he might require extra laces, a shoe polish, or insoles. Suggesting such items which don’t literally but superficially fall into the category will induce the customer to add more stuff into the shopping cart to pair up with his purchase.
   
4. This is possible when all the products follow at least 2-3 level categorizations. A high level view may categorize a shoe into footwear category, but it can be broadly classified into Men and Women’s shoe category, going further this shoe can fall into a formal or a casual shoe category. Therefore a detailed categorization of all the products that encompass your range should be done. So that the algorithms that regulate product displays on the webpage are fed in advance. And hence whenever customer selects a product, algorithm picks recommendatory products from its sub-categories. On the other hand, another retailer Costco.com posts other product recommendations based on previous user searches.
   
5. Never team a cross-sell that costs higher than the original selection. Probability of it being selected is dim. If customer takes a leap to buy an extra commodity, it should be well within his buying budget. And that budget is definitely not double the price of his purchase. In fact it approximates to 25% of the initial product price. Recommendations that bear a small price tag stand a chance in the shopping cart, as accommodating them does not distinctly inflate the cart amount. If you are suggesting accessories make sure they are not expensive enough to scare a user away as this might lead to cart abandonment, especially if the customer finds a similar pair at lesser price on another store. Although this might require you to apply more than one algorithms and a strong knowledgeable staff at the backside for suggesting relevant product. Price is the most important criteria that influence buying decisions.
6. Bundle up free delivery with carts exceeding a particular amount. Sometimes paying for the delivery takes a toll on customers, which causes them to shrink their cart total. Incentivizing their purchase order by free shipping can relieve them of the pressure and induce them to increase their purchase limit. Just to waive off the shipping costs, sometimes friends join their wish lists and make a single bill. This can also be done by clubbing products from the same retailer. This would not just ease off the shipping issues, but will also smooth the return and exchange process.

Track the progress of every marketing campaign after its implementation. Conduct webpage analysis to monitor the most frequented area of the page, keywords, etc. If your strategy combines both cross sell and up sell techniques, it would be tough to identify which technique generated more sales. If you contemplate the outcome based on user clicks, there could be many unknown factors that influenced the result. Maybe the customer just clicked to check product specifications or maybe it was a joint order by two people.

Often retailer use an amalgamation of Cross selling and Upselling, adopting any one of the two will be losing a revenue opportunity. Well this also depends on your articulation at these coercive techniques. Ultimately the intention is to maximize profit margins.

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