How do you generate more profit? Learn the secret of the upsell offer!
Many business owners are afraid of upselling. They don’t want to come across as too pushy or as if they are making a sales pitch.
When upselling is done right, it doesn’t feel like a sales pitch – it feels like you are in tune with your customer’s needs. You can easily increase what customers spend each visit, and it generates many other benefits, as well:
- It builds deeper relationships with your customers
- It’s easier than selling to new customers
- Increases customer lifetime value
- It creates repeat customers
All upsell offers have one primary goal: to increase the average transaction value of your customers, while making them happy.
Bob Ruffolo says on impactbnd.com:
“While mediocre businesses are focused on a single offer, smart (and insanely profitable) businesses are creating multiple offers to maximize their profit per customer.
For example, let’s say you have a $100 offer that you’ve sold to 100 customers. That’s a total revenue of $10,000.
You might not realize it, but roughly 30% of those 100 customers likely would have bought a $300 offer immediately following the purchase of the first offer. That’s an additional $9,000 of revenue, nearly double the amount of revenue generated from each customer!”
That’s the power of the upsell.
Most businesses don’t have Lead Magnets or Tripwires and they don’t have upsell offers. The only thing they do is sell their core product and make a living on its profit. This is why they struggle.
For example, McDonald’s makes $0.18 profit on a hamburger. The hamburger is their Core Offer, but it’s the fry and soda upsell that makes their additional $1.14 profit. This gives some additional insight to “Do you want fries with that?”
You don’t necessarily have to change the core product. The upsell can be a longer guarantee, or a package of other products and services. But you can sell products in bulk for better price value. If your business relies on shipping products, shipping multiple products together is typically cheaper than sending them individually. Amazon has taken advantage of this concept with their “add-on product” offers. Customers feel like they are getting a better value, and Amazon earns an incremental profit that they otherwise might not have.
Another good approach to upsell offers includes memberships or subscription services. These are good to consider because they generate monthly income from the same customer, while creating a value for their customers through convenience and consistency.
Set and track measurable goals
By setting up your goals from the start, you can be sure that your upsell strategy is aligned to help you achieve them.
Set a clear goal based on your priorities and develop an action plan with straightforward milestones. Now you can measure your upsell success and can make any changes as needed, based on these results.
Develop a buyer journey
The next step is to understand who your audience is, and build detailed customer avatars for them, including their goals, needs, and pain points at every stage of the buyer journey.
Your customers will be going through different stages, depending on where are they in the sales funnel.
You want to document every stage of the process, from getting the customer’s attention for the first time, to when they consume your lead magnet, to buying your product.
Then, once your customer uses your product and experiences all of its great benefits and , and has an amazing customer experience, they’ll be more likely to recommend your product or brand to others, and come back to buy more.
Identify customers with a need for additional products
Not every customer is a good fit for an upsell, and it’s not a good approach to push additional products or services on someone who doesn’t really need them. If you can’t explain how the upsell will benefit the customer’s life, then it isn’t worth trying – you risk driving away potential customers by being too pushy.
Instead, focus your upselling efforts on the customer’s need. If you think the current product will not help them achieve their goal, or take them where they want to be, then offer an upgrade.
Focus on timing
You want customers coming back. The secret is not only to provide value, but also to give value at the right time.
Depending on the stage of the customer journey your prospect is at, your upsell offers must be different.
Providing value as soon as possible
Nobody is going to buy additional products or services until you prove that you can deliver the results that you promised. To make the customer relationship a long-lasting and beneficial one, your product should provide value as soon as possible.
When customers see that your product or service works and solves their problem, they will be more likely to buy the upsell offer.
Provide a transparent pricing breakdown
Give your customer a complete breakdown of what you’re presenting and explain the cost and that what they will get for that cost.
Don’t be shy.
If a customer knows where their money is going, they will feel more comfortable about investing more in your products.
Upselling is a valuable skill to help you achieve your primary goals: make your customers happy and successful, while generating more profit.
Depending on where your buyer is in the customer journey, create an upsell strategy and timing, then offer different upsell options.
What could you offer as an upsell? What could you bundle with your core product?
Leave your comments below.
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