Cross-selling & Upselling Retail Examples + How Software Automation Takes Results Next-level

Cross selling & upselling in retail (in-store & eCommerce) can really boost basket size, but it’s vital marketing POS software & automation that turbocharges results.
0
min read
Aaron Blackman
,
CEO & Founder
,
Retail Express
July 4, 2022
Aaron Blackman
,
CEO & Founder
,
Retail Express
July 4, 2022

Table of contents

Which would you prefer — $200 or $250? 

Okay, it's a rhetorical question. But before you tell us it's a silly one, ask yourself the following; 

Am I sure my retail business has optimal strategies in place to make it more likely we'll get that $250? (Feel free to add zeroes to spike your enthusiasm.)

Retail is about making as much profit as possible. But many retailers are blind to the potential of cross-selling and upselling properly. This is a tragic mistake considering that a few strategic moves may be all it takes to dramatically raise revenue. 

Of course, most eCommerce giants know this. According to Invespcro, it's estimated that legend Amazon receives approximately 35% of its purchases through cross-selling. It's certainly a proven technique — so why not take advantage of it?

This article will show you ways to implement upselling and cross-selling in retail, from training staff to setting up vitally important automated retail software.

Cross-selling & up-selling: definitions

What is cross-selling?

Cross-selling is a sales tactic to generate more sales by suggesting additional items to a buyer who is already showing commitment to making a purchase. It involves buying other, often complementary items to the primary product. The classic example here is McDonald's "would you like fries with that?" You have shown intent that you want the burger (primary product); now, the vendors are suggesting you may like fries (complimentary product) to complement it.

What is upselling?

Upselling is a sales tactic to increase the average sales value. Instead of offering complementary products, the retailer suggests more recent or higher quality items that are more expensive. For example, a customer wants to purchase a new mattress in a furniture shop. The salesperson talks the customer into buying a more recent product with added features at a higher price.

Cross-selling vs up-selling: what's the difference?

What's the upsell and cross-sell difference? Cross-selling involves encouraging the customer to purchase more than one item; to buy something in conjunction with the primary item. Upselling involves talking the customer out of their original intentions and encouraging them to buy a more expensive item instead. 

Upselling is like an upgrade, whereas cross-selling is about recommendations to buy more.

Upselling and cross-selling can boost your bottom line at the point of purchase. And by automating your processes with Retail Express POS software, you free up time so you can focus on other things in your business and let the software maximise your sales. Get a free one-hour demo today to discover more.

Improving the customer experience while increasing sales value

Be helpful: When done well, both upselling and cross-selling are helpful to the customer. They should be somehow beneficial to the customer or the primary product. The customer should see the value or benefits of purchasing more. (They may not have thought about your suggestions at the time, but since you've mentioned it, it's a good idea.)

Don't focus on profit: Never think of upselling and cross-selling purely as a way of extracting more funds from the shopper's credit card. Such motives are transparent and will only irritate them. Instead, focus on how the customer will benefit.

Be reasonable: Keep the price of the primary product in mind. If the item is $30, don't jump to cross-sell (or upsell to) a $300 product. There's no set rule as to how much you could stray away from the primary product value, but it's around 25% for many retailers. 

Cross-selling to a lower-priced product is often easier, particularly if the primary item is highly priced. Bestselling author William Poundstone illustrated this brilliant point in his book Priceless – The Myth of Fair Value. He noted Prada and other luxury stores stock a few obscenely expensive items — just to make the rest of their inventory seem a bargain. However, less extreme examples will also work. For instance, if a woman buys a dress for $580, throwing in a pair of  $70 earrings is probably no big deal. 

Omnichannel POS is essential: In particular, cross-sales can only start to shine once you are fully functioning as an omnichannel retailer. If you record all purchases in the one retail POS system, then your ability to market to customers online or off is so much easier. And they'll enjoy the customer experience more — with all offers available both online and in-store. Without omnichannel functionality, though, there can be unnecessary friction, frustrating the customer and lowering your potential for a better bottom line. 

Read more about integrating your eCommerce and retail POS into one highly functional omnichannel system here

Cross-selling examples in retail

Cross-selling examples in retail can occur at various sales channels.

Retail store cross-selling example: 

  • Keen runner Sarah visits her favourite sports shop, tries on a pair of sneakers for runners with low arches (the primary product), and is excited about purchasing them. At the POS, the sales assistant enters the shoes, then sees a sign alerting her to socks that may make a successful cross-sale. So she asks Sarah if she's seen their arch support socks as she thinks Sarah might like them. No, she hasn't — and yes, she does — and adds them to her purchase. The cross-sell is complete.

NB: The above cross-selling functionality was made possible by using POS software

Email marketing cross-selling example:

  • Camping enthusiast Jack recently bought a lightweight tent from an online camping store. Four days after his new tent arrived, he received an email from the company asking him if he was happy with his new purchase. There were a couple of links to helpful articles on camping in the Australian outback. Nice! Useful! They also showcased three camping products —  suitable for someone with a tent (also nice and useful); a lightweight blow-up mattress, camping pillow and tropical-strength mosquito repellent. 

The mattress looks good, so he clicks through to the website to take a closer look. He likes it. Add to cart. Cross-sell complete.

Now, here's where it gets more interesting. 

He clicks through to the checkout and types his details, and the system identifies his profile. 

Lucky Jack. As it's his second order of over $100  in less than a week, he's given a $20 voucher.

What's likely to happen soon after?

Jack will likely return to the store and use that $20 voucher.

Will his voucher purchase be over $20, resulting in the camping store receiving more profit from Jack? Statistics say yes. According to a study by CB Tower Group, now acquired by Gartner, 65% of gift card redeemers spent 38% over the value of their gift card. That's a nice piece of profit.

NB: The above functionality was made possible by marketing, loyalty and CRM software. We'll explain more below.

Cross-selling ideas & best practices for retail

You can implement the following cross-selling best practices in-store, by training your staff to think through the following — or by automation, with the right point-of-sale software and specific eCommerce website functionality.

  • Complementary products: Offer products that help get the best value or use from the primary product. For example, if a customer is buying a power tool, ask if they have the appropriate charger at home for the tool.
  • Bundling: Think ahead and bundle related products that the customer may (but may not be aware that they) need and recommend them at the appropriate time. 
  • Discounts for bundles: Offer discounts for bundled products, giving the customer an immediate price saving and the retailer a larger basket size (and more profit) Alternatively, offer them extra loyalty points for bundles.
  • Loyalty programs & vouchers: Send customers an expiring loyalty points reminder (at least once) along with a suggestion of relevant complementary products to a previous purchase. You could even set a minimum spend threshold for redeeming the loyalty points to increase value. For example, orders over $X will immediately have $20 redeemed.
  • Offer assistance: Simply asking the customer if they've found everything they need before finalising the sale can be golden. When in-store, it's easy for the customer to open up if they've been gently questioned. "Did you find everything you needed today?" can result in, "Actually, I did need another salad bowl but didn't know where they were". Success. Likewise, a chatbot could start a conversation, inviting the customer to share their needs. This makes it far easier for a successful cross-sale online.

Create profitable promotions to select customers with loyalty programs

Why you should automate parts of your sales processes

Unless you have a tiny store, it's unlikely your staff can remember each product you stock, their functions and the entire list of compatible products. So how do we effectively cross-sell products without missing any gaps? Enter: automation.

By automating valuable information about your product line, you can quickly draw on the right products to showcase — to the right customers. Automation software doesn't just access your products; it accesses your customer data. It can access their previous purchases, preferences or location and make recommendations that make the most sense to them. And when things are data-led, there's a far higher chance the cross-sell will be successful.

Below are several ways to maximise the benefits of retail marketing software and automation.

IN-STORE SIGNUP 

First, you'll need to have data from as many customers as possible. When customers are in-store, you can:

  • Quickly add new customers at the POS during checkoutAdding customers at the POS allows you to build your database more easily while capturing the details for further marketing.
  • Create customer profiles With detailed information on each customer (email and phone number, purchase history, reward point balances) you can segment your marketing campaigns and be able to cross-sell and upsell later — on any channel.

Signing up customers at the POS is one the most effective marketing strategies for cross-selling and upselling — and for improving the customer experience through loyalty, targeted email and SMS campaigns and buyer behaviour analysis. But it has to be done with the right POS software.

NB: You can import your customer database directly into Retail Express' Point of Sale. Then you can sync your list automatically to your preferred email marketing tool like ActiveCampaign.

capture customer info in-store at the POS - build detailed profiles

More ways to grow retail customer loyalty & repeat business

CUSTOMER LOYALTY PROGRAM

With an in-house customer loyalty program, you can reward your existing customers for their loyalty with discounts, minimum spend promotions and targeted campaigns. For example, if customers buy over $300, they are entitled to a $20 discount.

GIFT VOUCHERS OR CARDS

Cross-channel gift vouchers are another way of encouraging customers to spend over the anticipated amount while bringing new customers into your store. They are also great for brand awareness, and best of all — they're not expensive to set up.

Next steps

Upselling and cross-selling will undoubtedly boost your bottom line. If you haven't yet automated your processes, though, it's time to make a move. Book a one-hour demo today to discover how Retail Express POS software can maximise your profits.

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Our Retail Express onboarding and support team have all had professional experience as retailers and know the challenges you face. That's why it's our priority to ensure switching to our cloud-based POS software is easy.

  • Personal Support Manager: You'll have your own Australian-based Personal Success Manager who'll guide you through the process step-by-step. All costs included. They'll help format and import your data, get you up and running, guide you with your hardware and help with everything associated with set-up.
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