What is Cross-selling? Examples of Cross-selling in practice
Cross-selling is a sales tactic that encourages customers to buy additional products or services related to what they are already buying or intending to buy. These products often complement or enhance the customer's experience.
For example, at fast food restaurants like McDonald's, KFC, Lotteria, the question "Would you like some more fries?" is a typical example. This is not just a normal greeting but a sales technique that helps increase revenue by inviting customers to buy additional related products.
In the restaurant and hotel industry, cross selling is used to increase profits. When a customer chooses a main course at a restaurant, the staff can suggest additional dishes such as wine to enhance the experience. At hotels, after booking a room, customers are often offered additional services such as spa, breakfast or tours.
Distinguishing between Up selling and Cross-selling
Many people often confuse Cross-selling and Up-selling because both are sales techniques with the main goal of increasing revenue for the business. However, unlike Cross-selling, Up-selling is a technique of introducing customers to products or services that are more advanced than their initial needs. The goal of this method is to convince customers to choose higher-value versions or service packages.
Comparison table of Up-selling and Cross-selling:
| Up-selling |
Cross-selling |
| Horizontal Sales |
Vertical Sales |
| Consulting on products related to the item to be purchased | Introduce items that are of higher value than what customers need. |
Benefits of Cross-selling
Cross-selling brings many important benefits to businesses. First, this technique helps increase sales and revenue, especially for less popular products. This technique also helps businesses' products and services reach more customers, thereby increasing brand loyalty.
In addition, cross-selling also prevents customers from going to competitors by meeting all their needs at the same place. This will create a more convenient and flexible shopping experience for customers.
However, if not done properly, cross-selling can bring many risks to the business. For example, if the staff recommends the wrong product, it can upset the customer and cause them to leave. Some customers can also take advantage of the promotions, putting pressure on the staff and making the cross-selling strategy fail.
Important principles to grasp when doing Cross-selling
Putting customers and their needs at the center
When businesses want to sell more products to users, always remember that the customer is the most important person. Businesses should not sell just for the sake of it, focus on the business's profits, but make sure that each suggestion is truly useful to customers.
If suggesting additional products or services helps the customer more and delivers better results, then it's not just 'selling' but 'solving a problem.' It's important to focus on the benefits the customer receives, not just on the sale.
Respect customer decisions
Nothing annoys customers more than trying to sell them something they don’t need. When applying cross-selling, businesses need to be careful to respect customers’ choices when they reject suggestions.
When cross-selling, sellers need to pay attention to both verbal and non-verbal cues from customers to see if they are interested. If they realize they are not, sellers need to stop and focus on providing the best service and building a strong relationship with customers. This approach helps businesses create cross-selling opportunities in the future.
Honest, clear
Another cross-selling principle that businesses need to follow is honesty and transparency. The seller must be someone who clearly understands the true value of the product he or she is offering. Businesses need to advise on the true value of the product without saying more than what is actually there.
Being transparent about the value and cost of add-ons “builds trust and helps establish a long-term relationship with customers. This is much more important than a one-time transaction,” says Yaz Hanley, director of business development.
Prioritize maintaining long-term relationships with customers
And the final cross-selling principle that businesses need to follow is to always prioritize maintaining long-term relationships with customers. This relationship needs to be continuously developed and maintained even when there is no cross-selling opportunity.
Sienna Quirk, Marketing Director at Invisory, says that if you only contact customers during renewal season, when there is a chance to make a sale, they will assume that your business is only interested in their money. On the other hand, if you consistently share useful information with customers, you will become more sincere in the mind of the user. This helps maintain a sustainable relationship and drives future sales.
How to apply Cross-selling successfully
Analyze customer journey to identify the right needs
The customer journey is their entire shopping experience in the store. This way, businesses can understand the needs, preferences, and desires of customers. From there, businesses can suggest suitable products to increase the chance of a successful purchase.
To do this effectively, businesses can use reliable sales management software that helps collect and store detailed information about purchasing behavior, shopping history, and customer feedback. This helps businesses easily categorize customers and provide the best service to them.
Choose the right cross-sell products
To choose effective cross-selling products, businesses need to ask important questions such as: What do customers usually want to buy with the main product? What product groups often go together? By analyzing previous successful cases and understanding customer needs, businesses can determine effective cross-selling products.
From there, through a reasonable way of introducing products, businesses can advise customers on products accurately. This helps create customer satisfaction so that they are willing to pay more for those product combos.
Show customers the benefits they will receive
To highlight the benefits to customers, instead of just focusing on the advantages of the product, businesses should emphasize the reasons why customers should own this item. This can include benefits such as cost savings, comfortable experience, guaranteed product quality, good warranty, etc.
From there, customers can realize their real needs and better understand the value that the product brings. This will make customers interested and willing to spend more on the product.
Be skillful in cross-selling, without annoying customers
To advise skillfully and avoid annoying customers, stores need to invest in training employees properly, especially in sales and communication skills. Well-trained employees will be able to direct customers to accompanying products naturally and effectively, without making customers feel pressured or annoyed.
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