Upselling

Upselling (sometimes "up-selling") is a sales technique whereby a seller induces the customer to purchase more expensive items, upgrades, or other add-ons in an attempt to make a more profitable sale. Upselling^[1] usually involves marketing more profitable services or products but can be simply exposing the customer to other options that were perhaps not considered. (A different technique is cross-selling in which a seller tries to sell something else.) In practice, large businesses usually combine upselling and cross-selling to maximize profit. In doing so, an organization must ensure that its relationship with the client is not disrupted.

In restaurants and other similar settings, upselling is commonplace and an accepted form of business. In other businesses (e.g. car sales), the customer’s perception of the attempted upsell can be viewed negatively and impact the desired result.

Examples

Some examples of upsales include:

• suggesting a premium brand of alcohol when a brand is not specified by a customer
• selling an extended service contract for an appliance
• suggesting a customer purchase more RAM or a larger hard drive when servicing his or her computer
• selling luxury finishing on a vehicle
• suggesting a brand of watch that the customer hasn't previously heard of as an alternative to the one being considered
• suggesting a customer purchase a more extensive car wash package
• asking the customer to supersize a meal or add cheese at a fast food restaurant

Techniques

Many companies teach their employees to upsell products and services and offer incentives and bonuses to the most successful personnel. Care must be taken in this type of environment to thoroughly train employees. A poorly trained employee can let slip the incentive program and thus offend a regular and loyal customer. There is a level of trust between the customer and employee and once broken it may never be reestablished.

A common technique for successful upsellers is becoming aware of a customer's background, budget and other budgets, allowing the upsellers to understand better what that particular purchaser values, or may come to value.

Another way of upselling is creating fear over the durability of the purchase, particularly effective on expensive items such as electronics, where an extended warranty can offer peace of mind.

Overlap with cross-selling

Upselling can be difficult to divorce from cross-selling when not entailing a more expensive substitute, it can instead simply refer to bolt-ons recommended by the manufacturer, trade federation, common practice, or regulators. A simple example is that of expensive leather shoes, where the seller may suggest to buy a waterproofing spray as well "to make the shoes last."

See also

Look up upsell in Wiktionary, the free dictionary.

• AIDA
• Bait and switch
• Choice architecture
• Contract of sale
• Cross-selling
• List of marketing topics
• Marketing
• Permission marketing
• Promotion
• Sales
• Selling technique
• Value added selling
• Downloadable content

References