We all know what upselling is. It’s when you invite your customer to spend more or upgrade, and usually requires you to market your more profitable products or services. This contrasts with cross-selling, which involves selling additional products or services to an existing customer.
While upselling and cross-selling can both be used for boosting revenue and protecting a client relationship, upselling is more often used for the former, while cross-selling more often for the latter. For now, we’re going to focus on upselling.
Why should I try to upsell?
The main benefit of upselling isn’t a secret—it increases your company’s revenue. So, if you want to grow your company, it’s much easier to do so through growing budget allocation for existing customers than by simply retaining them. Upselling can be a useful tool for sales directors in particular because, on top of boosting revenue, it can help to increase:
- Customer loyalty
- Return on investment (ROI)
- Customer lifetime value
Your existing customers are probably an untapped resource. In e-commerce, for example, some estimate that upselling is 68% more affordable than acquiring a new customer. Once you gain the trust of your customers, you open the door to potential investments in your company they can consider.
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So, why doesn't everyone just upsell all the time?
If upselling didn’t take any effort, it wouldn’t exist! Every company would simply choose for customers to spend more, and this would only increase the normal/average level of expenditure across the board. Upselling exists because not everybody has the right business-related information at the right time.
Upselling is about finding opportunities and making the most of them, and this is where customer data comes in. To find the opportunities that offer you the most potential for the optimal amount of resource investment, you need the right information at the right time to help you make the best decisions possible.
How do I use my customer data to upsell?
Before you start the upselling process, customers aren’t consuming all of your products and services. The key to upselling is to sell the right products to the right customers at the right time. In other words, you must offer your customers relevant deals. So, how do you do this?
The first step is to follow your customers’ journeys closely so that you can get to know them inside-out. Having an integrated customer relationship management (CRM) is crucial here. By dipping into your customer databases, you can identify patterns relating to, for example, agreements (what they bought) and delivery logs (when it was ordered and delivered).
This is the second step—using the knowledge of your customer data to predict the likelihood of them responding to certain offers. Crafting these micro segments creates upselling potential, which you can use to establish inbound processes that can then lead to efficient upselling campaigns.
Upsell successfully with deal scoring
Say you’re a manufacturer. You have plenty of data in your enterprise resource planning (ERP) system that tells you how your customers are buying your products. You can profile consumption for individual products.
Using this knowledge, you identify how often a certain customer buys wearing parts from you. You can then take advantage of this information in the next purchasing window to ensure that you’re the one making the sale.
At the core of understanding your customers’ behaviour is pattern recognition, which is something that machines do much better than humans. So, companies need to have the right tools at their disposal in order to upsell efficiently successfully.
Deal scoring enables you to focus on deals that offer you the highest chance of maximising your revenue. This is what InlineMarket’s powerful website analytics and predictive deal-scoring tools do.
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Our analytics platform puts all of your sales and marketing data in one place so that you can analyse your customers’ actions from the first touchpoint to a closed deal.
Similarly, our Predictive Deal Scoring tool uses machine learning to analyse your existing CRM data for patterns and predicts how likely it is for each deal in your sales pipeline to be accepted. This enables you to always make the best possible decision for your company.
To see how much upselling potential your company has, why not book a demo with us today?
