Upselling Generates Revenue – With the Right Strategy

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coleman_bobBob Coleman, publisher of the Coleman Report, was telling me yesterday about one of his upsell opportunities—where a customer can purchase a data report for $95, or access to the whole database for a little more. I let a “Wow!” slip out.

“That’s exactly the reaction I’m looking for!” he said. “There are two parts to my philosophy of the upsell: The wow factor—someone telling me that it’s a good deal—and if it doesn’t cost me anything extra.”

Coleman’s main upsell opportunities happen with webinars. It costs $389 to attend. When a customer signs up,Joseph Coleman, editor, talent and content, will talk to him or her on the phone to confirm and offer a $100 upgrade for a transcript and unlimited access to that webinar. They get about 20% conversions.

study by PredictiveIntent showed that upselling drives over 4% of sales compared to just 0.2% by cross-sales tactics (such as displaying “people who bought this item also bought”). So we’re talking serious dollars. Here are seven keys to the art of upselling:

  1. It should create goodwill. The idea is that you are giving someone a better deal because they already bought something from you. Coleman cites the example of a waiter who right away pushes the sparkling water instead of tap. “It establishes a bad relationship. The person should feel that [he or she is] getting the better end of the bargain.”
  2. There should be strong benefits. “If that waiter tells me, ‘we just got a special shipment in of spring-generated sparkling water—the last table loved it—and I can give you a special price on it,’ even if I turn it down, there aren’t bad feelings,” Coleman said. Explain to your customers exactly how this more expensive product can make their lives better.
  3. Make it easy. In a webinar earlier this year titled Design and Optimize Your Landing Pages for SuccessAdam Goldstein, publisher of Business Management Daily (BMD), spoke about his webinar upsells. After signing up for one webinar, customers are offered an upsell to a season pass. “We offer all of our webinars for one low price,” Goldstein said, still in selling mode. (Remember, all SIPA webinars are archived on an easy-to-access page.)
  4. Give limited choices. BMD offers customers the option to purchase webinar attendance, the CD, or both. For Coleman it’s with the transcript and unlimited access or without. An article on The Economist website talked about the psychology of choice. Tables were set up in an upmarket grocery store, one with 24 jams the other with 6. “…when it came to buying afterwards, fully 30% of those who stopped at the six-jam table went on to purchase a pot, against merely 3% of those who were faced with the selection of 24.”
  5. Talk to people—especially when you have a captive audience. Coleman mentioned his son Joseph speaking to customers on the phone and confirming their webinar registration—and offering the upsell. “If they say no, we move on,” Bob said. At a dance performance I went to last night, the artistic director came out before and addressed the large crowd. “If you really like the show tonight, you can get a subscription for the year at a very special rate. Our people are sitting outside.” The audience listened.
  6. Choose your best products. At BMD, those who sign up for the webinar also get two free bonuses, a book and a 30-day membership to their website which Goldstein calls “very robust and popular [with] articles, interviews, audio podcasts, checklists and forums.” That 30-day membership can lead to a new subscription. “Webinar attendees are very receptive to that upsell,” Goldstein said. “Conversion is upwards of 30%. [Such conversions] can make your webinar that much more profitable.”

And here’s a final one from a good post on HubSpot earlier this year…

7. Offer upsells that make sense. “If you’ve ever been on a site searching for a new throw pillow, only to see a suggestion for an outdoor furniture set, then you know the frustration that buyers often feel. The truth is, it’s hard enough to get those buyers all the way to the finish line as it is. You can’t throw them off course with a suggestion from out of left field.”

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Ronn Levine began his career as a reporter for The Washington Post and has won numerous writing and publications awards since. Most recently, he spent 12 years at the Newspaper Association of America covering a variety of topics before joining SIPA in 2009 and SIIA in 2013 as editorial director…