What Is Upselling? And How It Can Benefit Your Business

Marketing informs us that there are multiple ways to sell a product or a service. Some products are easier to sell than others; economic consumer items require less effort than expensive luxury items.


Persuading prospects to buy a premium service is challenging. Therefore, a tactic called upselling is adopted. Let us learn what it is:

What is Upselling?

Upselling is a technique used to sell expensive and premium versions of basic products. The tactic is adopted for generating higher profits. Many digital businesses are now combining cross-selling and upselling strategies for increasing the total order value. As a result, net profit is increased.

Upselling can be done in various ways, like before purchase, after purchase, or during purchase. You need to show some recommendations on the product page. These suggestions are displayed on the product page. However, pop up notifications are used for upselling during purchase. Some businesses prefer sending an email notification or message alert for upselling after purchase.

Successful upselling can only be done by knowing the accurate needs of the clients. Commendable upselling will make your clients feel like gaining something big. Some examples are:

  • Give rewards for bulk purchases like 30% off on all jumbo packs.
  • Display comparison of expensive versions with the basic versions. This is an ideal way of letting the clients know the difference. Always mention price along with features. In this way, clients will know what they will get for the extra investment.
  • Be sure that the advanced version is not overly expensive. Customers will never pay more than 25% of what they have already planned.
  • Never be pushy. Clients will lose trust in your business if they notice any pushy messages. Back your messages with relevant features. Give enough room for customers to decide the best.
  • Some websites show a sense of urgencies like the last hour before the sale ends or just 2 items in stock. This is another useful tactic of upselling.
  • Customize offers as per the loyal customer’s data. For instance, a company selling coaxial cables can announce driverless delivery during COVID-19.
  • Let customers know of the offer they have missed. This will make them stay high-alert for the next offers.

Just like other key marketing strategies, upselling is an important tactic for every business. If done in the right way, your business can reap multiple benefits from it. Let us see what these benefits are:

1.    It Helps in Long-Term Customer Relationship

Never treat upselling as a revenue-generating method. If it is intended to provide real value to customers, it will be a win-win strategy. Customers will be more than happy to know about greater value. That is why premiums, add-ons, and upgrades are created. In this way, customers feel like getting a great offer. As a result, the business gets more satisfied customers. When customers are satisfied, a long-term relationship of trust is created.

2.    It Helps in Increasing Revenues from Existing Customers

Adopting various lead-generating methods is time-consuming. Upselling, on the other hand, is easier and cheaper. Instead of working on prospects from scratch, upselling focuses on present customers. The chances of making a successful sale to new clients are just 5-20%. At the same time, the probability is around 50-60% for existing customers. Therefore, e-commerce businesses find upselling as an easy route of growth.

3.    It Builds High Customer Lifetime Value (CLV)

CLV has a direct relation with revenues. It is the overall contribution of a customer to the business revenue. Businesses divide their customers into three broad categories like profitable, non-profitable, and highly-profitable. Upselling increases the overall CLV, meaning that a business enjoys more highly-profitable customers for a longer time. Having customers with high CLV is better for the overall growth of the business. With upselling, a business can enjoy customers coming back to the website for repeated purchases.

4.    It Requires Less Budget

In comparison to targeting new customers, the cost required in upselling is remarkably low. The ultimate aim of every business is to earn revenues and build trust. Upselling brings both of these things. Therefore, it is the most preferred strategy for smart business owners.

5.    It Builds a Good Business Reputation

Upselling can be successfully done when clients agree to buy premium products. The features and benefits of the premium products are much more than the basic products. It helps in better customer experience as customers can now fulfill more needs. Therefore, a good brand image is created in the eyes of the customers.

When clients are satisfied, they suggest the brand to colleagues, friends, and family. As a result, more customers are generated, which in turn brings more revenue. For instance, one Grammar checking software has three versions—basic, Advanced, and Premium.

The basic version highlights the plagiarized content, and the advanced version highlights grammatical errors and plagiarized content. Finally, the Premium version highlights errors along with an auto-correcting option and detecting plagiarized sentences.

A client of the above software started using the basic service through which he was able to avoid plagiarism. However, the business owner used an upselling strategy and sent pop-up notifications for a premium version.

Now, the client is more likely to buy the premium version because they are already using the free version and have come to depend on it. What is more, since the client is satisfied with the service, they are more likely to post it on social media and suggest the service to friends, which helps build a great reputation.

Wrapping It Up

In short, upselling is an effective strategy for selling advanced products and increasing profits. However, customers should feel an increased value and winning a big deal. Businesses should adopt creative ideas for making this realize to existing customers.

Notifications, comparisons, messages, and emails are a few ways of educating present clients. Upselling provides numerous benefits to both small and large-scale businesses. Brands build a strong relationship with existing customers, observe growth with little investment, enjoy higher customer lifetime value, and get a great reputation.

Have you tried upselling so far? What benefits did you get, and how was your experience? Share some tips with us!

Author Bio:
Shaheryar provides ghostwriting and copywriting services. His educational background in the technical field and business studies helps him in tackling topics ranging from career and business productivity to web development and digital marketing. He occasionally writes articles for Shireen Inc

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