Cross-Selling vs. Upselling: Definition, Examples, Tips, and All You Need to Know

It is always great to have new customers, but what is their contribution to your average order value? Retaining existing customers and encouraging them to make new purchases is easier than acquiring new ones. And cross-selling and upselling strategies help you just do that.

Key Takeaways

• eCommerce cross-selling and upselling are two necessary strategies to optimise your sales, build stronger relationships with customers, and increase CLV. 

• Relevancy and personalisation are substantial to make on-point cross-selling and upselling recommendations. 

• Reach out to your customers with new offers and deals even after the checkout process.

What is Cross-Selling? 

Cross-selling is selling an additional item to a customer’s initial purchase. Think of those times when you wanted to order a burger and were asked if you wanted fries or a drink with it, and you said yes. Well, you got cross-sold!

In eCommerce, when a customer is about to buy a product, and you want to cross-sell them, you recommend a product that is related or complementary to the initial purchase. It helps you show your customer that you know about their needs and guide them to buy anything else they might need, even before they realise they need it. You deliver them more value, and they contribute to your AOV. It’s a win-win!

Cross-Selling Examples

Let’s think of a scenario where a customer is about to buy a foundation and gets recommended a proper brush to apply it, a foundation base, or a setting powder to make it last on the product page even before they search for it separately.

Another scenario is when a customer looks for a laptop. Throughout their shopping, they also see related products they might need to use along with their new laptop. At this point, this means that they are in good hands that know how to construct a satisfying eCommerce journey for the customers. 

To cross-sell to a customer looking for a laptop, you can showcase a mouse and a mousepad to make it more convenient; a briefcase, sleeve, keyboard, or headphones. The options are wide as long as you have insight into the products and the customer’s needs to offer the right products. 

6 Great Cross-Selling Techniques to Boost AOV

There are a couple of ways to cross-sell your products effectively. Here are some of them: 

1. Product Recommendation Based on Purchase History

As a part of customer research, a customer’s past purchases grant you the great insight required to segment your customer base. It not only helps make accurate and related product recommendations, but also provides information for building customer profiles for future recommendations and strategies.

2. Offering Additional Services 

Cross-selling additional services is another way to increase AOV. Services like furniture installation, extended warranty or insurance, software products, etc., help you compose a complete shopping experience and result in satisfied customers who would like to come back and see what else you have got to offer.

3. In-Cart Recommendations

A customer may add the product to the basket and directly proceed to the cart page to finalise their purchase. But it is still not too late to show them what else you have! You can take another shot and showcase complementary products by utilising order bumps and bundles. 

4. Post-Checkout Offerings

When a customer finalises their purchase without an additional item, you can still have a chance to draw them back to you! You can make post-checkout offers on the “Thank You” page, get to them via email to make other related offerings, send push notifications or use pop-ups to both remind them of the product and create urgency.

5. Offering Discounts

Discounts and campaigns also have a high possibility of bringing back a customer or convincing them to add additional items to their basket right on the product page. Those deals are great for boosting your customer retention rates, too. 

6. Product Bundling 

Bundles are great for showing a couple of products to customers at once. As long as the products are not far-fetched, and the pricing is reasonable, in a way that will not scare away or confuse the prospect, they are wondrous tools that will bring you many benefits on your way to growth.

You can use it to make your offers as a package to make it easier for the customer, as all it takes is one click to add a couple of products to the basket at once, or you can just suggest a couple of related and frequently bought together products and let the customer choose the best option for them.

Bundling should not be restricted to a single form. Bundles can be devised distinctively for any industry. You can build different types of recommendation campaigns like product bundling, frequently bought together, shop the look, buy the room, similar products, order follow-up and many more through the Segmentify dashboard with only a few clicks and monitor their performance with ease. 

3 Cross-Selling Tips for eCommerce 

1. Relevancy

Whatever the product is, you need to be diligent about the additional products you want to cross-sell. They need to complement and add value to the initial product. The more relevant the product, the more likely the customer will buy it, since they already are looking for a product in a specific and related category and are eager to up their order’s value. 

2. Pricing

Besides relevancy, the prices of recommended products are also worthy of consideration. They should be low enough for the customer to add them to their basket without a second guess but high enough to contribute a remarkable amount to the AOV. 

3. Personalisation

It is great when the cross-selling offers are integrated with the product well. Reasonable pricing is superb! But they will not be as effective without identifying the best offer for the customer. Personalisation is the key to analysing each customer and their interests. It helps you make the most relevant recommendations that might get your customers’ attention and make your cross-selling strategy work. 

What is Upselling? 

Upselling is selling an upgraded or a higher version of the initial product the customer intends to buy. It aims to increase the profit and AOV by offering a more expensive product. There are many ways to upsell and make it work for a profit and AOV boost.

Upselling Examples

An example from the beauty industry is that after a customer adds a face cream to the basket, they are shown some other more expensive and upsized options which are more convenient and budget-friendly for the long term. 

Let’s move along with the laptop scenario. If you want to upsell, you would recommend a laptop with a memory upgrade, a bigger aspect ratio, or a higher RAM. As with cross-selling, if you have adequate insights into your prospects and products, there is no reason that this strategy will not work for you. 

6 Upselling Techniques You Can Try

1. Added to Cart

When a customer adds a product to the cart, display an Added to Cart pop-up and place more recommendations in case they missed out on the ones on the product page. 

2.  In-Cart Recommendations

Do not give up! Trust your AI-based algorithms and carry on recommending. Your customer may be one of those people who like to jump to conclusions, but do what you can to improve their shopping experience.

4. Post-Checkout Offerings

A one-click upselling offer on the “Thank You” page can be an opportunity for the customer to reconsider their purchase or note them for their next purchase. Emails can be another place to make your offers, too. Send them coupons and make special offers to let your customers know that you still care about them and are still a part of their shopping journey.

5. Offering Discounts

Discounted products with upgraded features are likely to make your customer change their mind and lead them to get a better version of the product they are viewing for a reasonable extra price. 

6. Product Bundling 

There are no limits to bundles. You can benefit from them in any way you want to. For your eCommerce upselling strategy, use them to show products from the same category with better features.

3 Upselling Tips for eCommerce 

1. Relevancy

Relevancy is substantial in upselling as well. Yet it is a different kind of relevancy we are talking about. Since you are trying to sell an upgraded version of the same product, your upselling recommendation should belong to the same category as the initial product. If someone is looking for a laptop, you cannot upsell them a keyboard. Show them laptops, but with better features.

2. Pricing 

Yes, the aim is to increase the profit and sell a product at a higher price. But a big price difference between the initial and the recommended product might come off as aggressive, and the customer might not even consider taking a look. A pre-purchase upselling should be soft and plausible. 

3. Personalisation

We have already covered the importance of personalisation in eCommerce cross-selling. But it is also worth noting that the purchase history can be used to tailor special offers and discounts for a specific customer base. And you can display products according to their browsing history to create a better shopping experience. 

The Difference Between Cross-Selling and Upselling 

As you may have already figured, the difference is simply this: Cross-selling refers to selling any additional item to the initial product. In contrast, upselling refers to the sale of a higher or upgraded version of the product.

In cross-selling, the price should not be higher than the initial product, while in upselling, the price of the product you upsell is higher than the initial product.

You can cross-sell a product even after the check-out, whereas upselling is more about the pre-purchase process. Since the point of upselling is to introduce a new product from the same category and canalise the customer’s interest towards that product, upselling should happen before the completion of the purchase. 

Whatever their differences, the key to a successful cross-selling and upselling experience is to provide accurate recommendations with a high probability of getting purchased. And to do that, you need to make the right offers to the right person at the right time. With our AI-based technology, you can provide your customers with a unique shopping experience that would lead to their satisfaction and loyalty in the long run. 

Wrapping Up

eCommerce upselling and cross-selling are two strategies you must benefit from if you have not yet. If implemented accordingly, their advantages are bountiful. It will result in a boost in your AOV and revenue. It will improve customer satisfaction and, in turn, increase your retention rate as well as the customer lifetime value in the long term. 

But it is not likely that all of these are possible unless you pay attention to the significance of segmentation and personalisation. You can consult us and book a demo if you want to see the wonders of AI-based personalisation for yourself!