Increase Revenue and Retention by Building on Established Relationships
Mastering the art of the up-sell can be difficult, but once it has been done the benefits are exponential. Up-selling is a great way to increase revenue and retention without having to do most of the manual dig that comes along with prospecting. By up-selling to an existing customer base, you open the door to extended contracts and purchase of new products. So when should you up-sell your customers? If you find yourself in any of the positions below, now may be the right time.
When You Can Provide Additional Value
Integrity is a key component of nearly every successful business partnership. The best sales people are the ones who offer actual value. Rather than selling a product, sell the solution to the problem at hand. Aim to either enhance a particular experience or make someone’s job easier. By doing this you add value, making your product or service more worthy of purchase.
It’s also important to align an up-sell strategy with the products that a company is already buying. For example, if a company is purchasing electronics from you, you should also offer the equipment that powers those electronics. Keeping the up-sell relevant demonstrates that you understand the needs and functionality of that particular business, rather than appearing that you’re selling something that may benefit you financially, but doesn’t address your customer’s needs .
When Your Product is Selling Itself
The best time to up-sell to a current customer is when they have indicated that they’re in need of your product. Don’t count on them coming out and asking you to charge them more, but pay attention to their needs and actions. When a customer recognizes their own need, they will feel more inclined to make a purchase. For example, one of our Pulse® customers may say something like, “I wish there was a way to append my large data files without having to manually verify each company.” This is when we would introduce them to Boost®, a product that does exactly what they’re asking. In this case the customer had the opportunity to identify their own need and then look for a suitable option, rather than needing to be convinced that this is something they would use.
Don’t assume that your customers know about everything you have to offer. If they’re expressing an interest in additional products or services, educate them on what you have to offer before they go looking for it with your competitors. There’s nothing worse than a customer saying that they chose to work with another company, leaving you thinking “wait, we could have done that too.”
When the Customer Can Afford to Pay You
If a customer is making small payments, late payments, or no payments at all, now is not a good time for an up-sell. Focus on customers who are demonstrating upward trends of growth and who have shown that they can make timely payments. As a data provider, Cortera shows businesses what other businesses are buying. This makes companies more aware of their customers’ financial health. The most qualified companies for an up-sell are those who are spending more, even if it’s not within your specific industry.
If a company is spending more on “luxury” items (not essential to their everyday business), then it is likely that they have a steady cash flow. Use this information as leverage to offer additional features that will enhance their customer experience, while also staying within budget.
When the Customer Has Already Paid You
Up-sell techniques should be reserved for businesses who are already paying customers. What this means is that they must have already made a purchase from you and paid for that product or service. By trying to up-sell on the first sale when there are no buying signals being conveyed, you may lose credibility by pressuring the company, thus causing them to back out. The time to wait will vary depending on business and industry, but no matter what, wait until a solid foundation has been made before trying to force-feed anything that may seem unnecessary. Only when a customer trusts you, and your business, will they feel comfortable enough to purchase more.
In most cases, a current customer will be far more profitable than a new one. After you have established a level of trust, you can confidently approach your customer with an opportunity that they will recognize as something that will lead to a successful outcome.
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