What is upselling?

The probability of selling to a new prospect is 5-20%. The probability of selling to an existing customer is 60-70%. - Paul W. Farris, Neil T. Bendle, Phillip E. Pfeifer and David J. Reibstein - Marketing Metrics: The Definitive Guide to Measuring Marketing Performance

Impressive, right?
But accurate. Wouldn’t you rather buy from a company you know and trust than from one you don’t?
That is why upselling has become such a popular sales practice. It makes sales easier and helps you reach your goals faster.
Upselling is a sales technique where a seller tries to sell an existing customer other items that might enhance the customer’s experience. A customer can buy upgrades or add-ons they may have not considered in their initial purchase. If done properly, upselling can mean additional income.
Upselling will help you build deeper relationships with customers. If you focus on helping the customer “win” by suggesting the service or product that will deliver more value to their purchase they will have a feeling of happiness, good service and most of all, they will feel that you care. That is the kind of client that will eventually return and will be happy to do business with you again.

Tell me how I win. When I win, you win.- Jeffrey Gitomer

Upselling drives Customer Lifetime Value (CLV), the net profit contribution a customer makes to your company over time. The higher CLV means more revenue for your business by one customer, without you having to invest more in generating leads.

But how do you get to a successful upselling?

It is important to understand how to upsell. Doing it wrong can generate negative feelings in your client and, ultimately, you since your sale might be rejected.

There are a few things you need to consider when trying to upsell to your customer:

• The product or service recommended should be significantly cheaper than the one being purchased. Customers are usually reluctant to pay more than additional 25%.
  If the customer says, “no thank you”, be ok with that.
• Give the customer space and don’t be pushy.
• Identify the customer’s needs and make sure they understand how the add-on will help them meet those needs.
• Compare what they are buying to what you are offering, highlight advantages, make sure they understand the value of the upgrade or the premium version.
• Tell the customer about the risks of not taking advantage of your offer.
• One-time or in-the-moment offers might encourage the customer to decide for the offer.
• Usually, rewards such as free shipping or cash rebates are good incentives.
• Use customer data to personalize the offers.

One of my clients is an international company based out of Boston. I work with them translating all their communications with their Mexican offices. I knew their people in Mexico had the need for translation services, but they already had a vendor. I had been working with them for about six months, building a solid relationship with their communications director and she had already introduced me to other area directors who were using my services. I wanted to offer them my services for Mexico, but I needed to gather information and wait for the right time. Once I felt the water was right, I jumped in.

Through my communications I had learned my clients sometimes were not 100% satisfied with, or even worse, couldn’t fully understand the translations to English sent their way. I even knew they preferred to make translation costs corporate. Thanks to frequent visits to the company site I found out about some changes in the Mexican staff. So, I made my pitch. I offered my client the same reliable service they already knew with a few perks for them. They could have a centralized control of translation costs, a special price deal based on volume, and I already knew the company and their needs. By making the advantages obvious and presenting my offer at the right time, I was able to upsell a very lucrative deal.
We can see many successful examples of upselling all around us. A chart that compares the advantages of different cell phone models. A discount offered if you buy an annual software license instead of a monthly plan. Top-shelf drinks with the “gold” package at an all-inclusive resort. Shorter standing-in-line times if you purchase the VIP experience at an amusement park, and you might even go again sooner than usual if you know you don’t have to wait in line. An additional protection for your appliances to extend the manufacturer’s warranty. All these offered at no additional cost to the seller and all of them offer a clear benefit or “win” to the customer.

Upselling is everywhere. It is a great sales tool, if used right, it will boost your sales. It can be the one reason you close a deal.