What Is Cross-Selling and How Does It Work?

Key takeaways:

  • When a corporation or salesperson sells a customer a complementary or similar product to what the consumer is already buying, this is known as cross-selling.
  • When a shop persuades a consumer to buy a product that they value more or that they believe is a superior version of the one they initially meant to buy, this is known as upselling.
  • Offering products in a bundle, offering discounted rates for bundled products, employing visual aids, integrating suggestions throughout the purchase process, and knowing how to deal with objections are all good tips for effective cross-selling.

Cross-selling is regarded as one of the most effective marketing strategies since it helps businesses to boost income without having to acquire new clients. Cross-selling can also help a company save money on other marketing channels. 

We’ll look at what cross-selling is, how it differs from upselling, and five suggestions for effective cross-selling with examples in this post.

What is cross-selling?

Cross-selling is when a company or salesperson sells a customer a complementary or similar product to what the customer is already purchasing. For example, if a customer is buying a shirt, the salesperson may try to cross-sell them a necklace that complements the shirt.

Cross-selling can be very beneficial to companies as it allows them to bring in more revenue through one customer. The more cross-selling a company does, the more revenue it can make from existing customers who are already committed to making a purchase.

How does cross-selling work?

Cross-selling works by offering suggestions of products or services that go well with the product or service the customer is already planning on buying. The method varies based on the shopping experience.

In-store: frequently accomplished in a physical business by presenting customers with products or services that would complement their current intended purchase and explaining how the extra products or services would improve their purchase. A customer may be offered fries or another side to go with their sandwich by a fast food salesperson.

Cross-selling vs. upselling

Cross-selling and upselling are terms that are frequently interchanged. These are, however, two distinct marketing strategies. Cross-selling is the practice of offering complimentary items or services in addition to the item or service that the consumer has already decided to purchase.

When a shop persuades a consumer to buy a product that they value more or that they believe is a superior version of the one they initially meant to buy, this is known as upselling.

Upselling does not usually contain complementary products and instead focuses on persuading clients to make a larger purchase. 

If a buyer is thinking about purchasing one version of a mobile phone, the salesperson in the store may try to upsell the buyer to purchase the most recent version of the phone. This is done by convincing the customer that the newest version is better than the older version.

In cross-selling, salespeople are more concerned with convincing buyers why one purchase would complement another.

The goal of both upselling and cross-selling is to increase the value of the purchase being made by a customer and add value to the customer’s buying experience.

Examples of cross-selling

Here are additional examples of cross-selling:

  • Clients who already have a bank account with a financial firm are cross-sold tax planning and preparation services.
  • A restaurant sells side dishes to go with a customer’s main course.
  • A salesperson advises a customer who is purchasing a laptop that they should also get a backup hard drive to store their essential data.
  • A “customers also liked” area on each product page on an e-commerce website gives cross-selling ideas.
  • Mannequins with entire clothes and accessories are displayed in a clothing store so that customers can see how all of the pieces go together and are more inclined to buy all of them rather than just one.
  • Customers should purchase in-car floor liners to preserve their new vehicles, according to a car dealer.
  • When a customer buys a bicycle, the retailer gives them a discount on a tyre pump or a bike light.

Five tips for cross-selling

Get the most out of your cross-selling marketing efforts by using these effective approaches:

1. Bundle products

Offering products in a bundle prevents the buyer from having to search for complementary products or services themselves and makes the idea of buying the bundle more appealing.

For example, a retailer bundles an “at-home manicure kit” that includes a nail file, nail polish, and a topcoat. While the customer can also purchase just one product from the bundle, knowing that the other products complement each other will make it more likely that buyers purchase the bundle rather than a s ingle product.

2. Offer discounted prices for bundled products

You can also offer bundled products at a discounted price.

For example: If a customer purchases a bundled group of products, they will receive a 10% discount that they wouldn’t receive if they purchased the products individually or only purchased one product.

3. Use visual aids

Showing customers how well certain products pair together is a great way to increase your cross-selling success.

For example, if you own a clothing store, displaying items together in the storefront or on a mannequin demonstrates to customers the compatibility of those products.

When customers can visually see how well the products go together, they are more likely to decide to purchase all the products as opposed to just one.

4. Implement suggestions throughout the buying process.

If you have an online storefront, placing cross-selling marketing throughout the buying process is an effective way to encourage customers to purchase more products.

For example, when a consumer adds an item to their online shopping basket, your website may suggest three additional things that are suggested or usually purchased together.

To make extra buy recommendations, you might include an “often bought together” or “customers also purchased” section on product pages.

5. Know how to combat objections

Many customers will initially object to purchasing additional products. The cross-selling process runs much smoother when you are prepared for these objections and can provide customers with valid reasons why the additional purchase is worth it.

For example, if you try to cross-sell protective mats for the car floor to a customer who is buying a new automobile, the consumer may initially deny the offer.

However, if you explain to the consumer that they will save money in the long run by not having to have their car cleaned or the interior fixed as frequently, you may be able to overcome the objection and persuade them to make the additional purchase.

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