One of the best ways to boost your company’s revenue is simply to get more money from existing customers. Upselling is a tried-and-true sales strategy where you encourage clients to purchase upgrades or other add-ons in to increase the profitability of a sale.
We all know it’s easier to sell to someone who’s already bought from you. “The probability of selling to a new prospect is 5-20%. The probability of selling to an existing customer is 60-70%,” according to Marketing Metrics research. However, in my experience working with online business owners, most of them wait until the initial package or service comes to an end before they include additional offers. I recommend taking a different approach.
Upsell and offer the service package add-on at the beginning – while you’re on the first sales call! This is an effective way to increase your revenue per customer.
Here’s how to get started:
1. Know the added value
Your goal is to increase the order value and inform clients about additional product options they may not know about. The first step is to know why they’d want the add-on in the first place.
“Before you can attempt to sell additional value to your customer, you need to have a firm grasp on what kind of success is important to them,” says Hubspot’s Karla Cook. “Early in your relationship, you should set aside time to sit down and discuss what your customer wants to gain from using your product or service. Explore not only the immediate goals, but also the customer’s larger, long-term plans.”
2. Create the add-on incentive
It’s important that your upsell isn’t just some random offer. It should enhance the package (e.g., help your client maximize their results). It’s pointless to say, “Oh hey! You should add this service.” It has to make sense, which is why you have to be clear on why it on would benefit your client. “If you know what your customer values and where she wants to go, then you can identify areas where additional products and services can help down the line.”
3. Cultivate a sense of urgency
Create an incentive to purchase in lieu of waiting later. Create a sense of urgency. “When prospects don’t feel any sense of urgency to buy your product or service, they’re much more likely to drag their feet. They might even give you the dreaded ‘I need to think it over” response.'”
For most people this urgency can be created in the form of a limited time monetary incentive. For example, if a client purchases the add-on today the price would be $1,000. However, if they wait for a later date the rate increases to $1,500. You get the idea!
4. Make the offer
Once you’ve done the hard work on a sales call and a client says yes to the initial service package, offer the add-on. You could say, “There is also the option to further enhance your package. You can expect ‘X’ result by adding ‘Y’add-on. Would you like to hear how that might work?” Simply put the offer out there.
The power of upselling
It’s surprising how many clients will take you up on the offer; especially if the value is clear. I find that many online business owners automatically assume clients won’t be receptive to upsells. In reality they are in the perfect space to be receptive to enhancements that go the extra mile to meet their needs.
I’ve personally worked with clients that have increased sales revenue by 50% purely by offering add-ons. So just think what it could potentially do for your business.
Jane Baker is a business owner and coach. She specialises in working with online business owners helping them craft a message, packages and strategy that enables them to attract their ideal clients who are ready and willing to pay their prices!