How to Boost Sales Through Cross-Selling and Upselling, Part 1 of 2

As customer acquisition costs continue to rise, be it catalog mailings or other techniques, many marketers have turned to optimizing performance from existing customers as a way to limit costs while improving sales, namely through cross-selling and upselling. In a presentation at the eTail 2008 East conference in Washington, D.C., last week, Michael Dell’ Arciprete, vice president of marketing for Boca Java, an online coffee retailer, rattled off a number of best practices to help online marketers boost sales through cross-selling and upselling.

(Note: This is part one of a two-part series on this presentation. Check back next week for Dell’ Arciprete’s tips on what not to do when cross-selling and upselling to customers.)

1. Show relevant items. Citing CDW as a leader in this area, Dell’ Arciprete said to make sure your cross-sell or upsell item is a logical progression to the original purchase. For example, a leather camera case as a cross-sell opportunity for a customer who’s just bought a digital camera.

2. Speak to the customer. Make recommendations to highlight other items customers might be interested in based on their original purchases. Dell’ Arciprete said Amazon.com does a terrific job with this.

3. Solve problems. Cross-sell or upsell a product to make customers’ lives easier, Dell’ Arciprete said. Batteries are appropriate for electronic items while grinders are appropriate for coffee beans. This way, customers receive greater savings and value, he said, because they only pay one shipping and handling charge.

4. Let customers sell to customers. Use product reviews, Dell’ Arciprete advised. “Customers want to know what other customers are buying and recommend,” he said. Customer reviews “give you credibility and make them more interested to come back to your site.”

5. Upsell in every channel. Upsell over the phone, on your Web site, in inserts in product shipments, in e-mails and in any other marketing vehicles you distribute. Have some of the offers be for a limited time; “This creates value,” Dell’ Arciprete said, “and a sense of urgency with the customer.”

6. Upsell in the shopping cart. Thumbnail what they’re buying, and move up the value chain using a good, better and best model, he noted. For example, upsell three possible products, priced at $7, $15 and $30, respectively.

7. Make it easy to return to the product page.

8. Show impulse items for cross-selling opportunities. Examples given by Dell’ Arciprete included gift wrapping, warranties and batteries.

9. Offer discounts on one item when you buy another. This upsell technique is used effectively by Amazon, Dell’ Arciprete noted. Amazon has gotten its customers trained to reach the $25 threshold needed for free shipping, he said.

10. Provide an online glossary. This is a tool that many online retailers aren’t using, Dell’ Arciprete pointed out, but should. It’s a way to make sure your customers are aware of what every term on your site means.

11. Position your cross-sells next to the “submit” button. This is the best spot on a Web page to cross-sell, Dell’ Arciprete said. People still read left to right, so this should generally be on the right-hand side of the page.

Next week in the final part of this two-part series, we’ll focus on several tactics Dell’ Arciprete advised the audience to avoid when upselling and cross-selling.