Some lessons can only be taught by gathering experience, trying, failing, and eventually succeeding, at some point. However, it doesn’t hurt to share some valuable insights with people who just got into sales, be it a sales position or owning a new business. When I first started out, many of the terms and techniques either seemed like one and the same thing, or didn’t seem relevant to my line of work at all. Cross-selling and up-selling included. Looking back, if I knew what I know now, my life would have been much easier. But those days are long gone, and now I’m here to make your life easier by telling you what I wish someone told me back then.
It’s not the same thing
Especially when you’re first starting out, the two terms may seem as very similar, even identical. And the similarities are indisputable: both stand for having the customer leave with something that adds value compared to what their initial choice was.
Cross-selling, simply said, consists in offering an additional product to the one the customer is interested in; one that is relevant, complementary and brings extra value to the deal.
Up-selling, on the other hand, means convincing the customer that while they have made a good choice, there’s an even better choice to make. In other words, it means upgrading the sold product so that the customer is convinced about the pros.
Both tactics require the customer making the purchase without feeling like being pushed into paying more for something they don’t need.
Needs vs. Value
For cross-selling, the number one indicators are the customers needs. When successfully identified, the cross-sold product will come as not just a complementary, but even necessary item the customer can’t leave without. For example, selling mortgage insurance together with a loan, or selling a child seat together with a new car.
When up-selling, the needs play a significant role as well, but instead of acting on them with a product, they have to be satisfied with added value; a safer car with a more efficient and environmentally friendly engine, or a longer lasting mortgage with higher downpayment but better interest rate.
It took me some time to fully grasp the difference, but once you do, it will become much easier for you to communicate the right offers to the right kinds of customers.
Don’t push too hard
This is general life advice that can be applied to all kinds of situations, and it has its place even here. Loan officers and salespeople often make the mistake of putting the client under too much pressure, which often results in the whole deal stalling or even evaporating.
All customers, regardless of the product or their background, are very price- and pressure-sensitive. The way they perceive your personality, your advice and consequentially your brand is vital for the forming of the customer-brand relationship. Being too intense and making the sale more about your success will absolutely lead to failure in the long term.
The advice? Whatever you do, always be tactful and observant of the customer’s reactions. Some offer you more space to negotiate, others none at all. Learning when you can afford to cross-sell or up-sell and when it’s better to stick to what the customer came for is one of the most important lessons ever.