Upselling and Cross-Selling: How to Increase Your Order Size
The most frequent question we get from farmers is how can I increase my order size to meet my minimum order requirement?
No matter the industry you’re in, the Harvard Business Review found that acquiring a new customer is 5-25x times more expensive than retaining an existing one. Make the most out of the customers you already have! To do so, there are two very important words to know: upselling and cross-selling.
What is upselling?
Upselling is a sales term for encouraging customers to buy more than what they are already purchasing—for example, encouraging customers to buy a larger pack of meat instead of a smaller one or buying a full CSA share, versus a half share.
What is cross-selling?
Cross-selling often can get confused with upselling. The big difference is that cross-selling is encouraging a customer to buy a complementary product that pairs with their original purchase. For example, herbs that go well with a particular protein or fruits that pair well with yogurt.
Upselling and cross-selling can be a great way to increase your average order size and get more from your existing customer base.
Here are the most important things to remember:
- Determine what works best for your business
- Decide whether you're up-selling pre- or post-sale
- Make sure it's relevant
- Demonstrate the value
- Ideas for promotion
1. Determine which method works best for your business
Depending on your business model, upselling or cross-selling may work better for your business. Upselling can be very useful for businesses that have different pack sizes, for example, meat producers. It can also be effective for CSAs that offer different share sizes. Cross-selling works great for food hubs or producers that offer a large variety of products. You can easily suggest pairings or recipes that can be made with the products you sell.
Depending on which method you choose, you may have a different sales approach. For upselling, you may choose to include value. For cross-selling, you may focus on promoting specific product pairings based on seasonality or an upcoming holiday.
2. Pre- or post-sale?
Upselling and cross-selling can both be done pre- or post-sale:
- Pre-sale means that they were encouraged to purchase a larger size or an additional product before they paid.
- Post-sale means they are sent promotional material after they paid.
The benefits of pre-sale are that you can increase the order size before purchase, but it can quickly become a deterrent if you come on too strong. Cross- or upselling post-sale means you are not affecting the initial sale, but you can encourage your customers to purchase again.
Also, the choice between pre- or post-sale is dependent on whether you’re selling online or in-person. A pre-sale cross- or upsell may be easy to achieve when selling at the market or farms store but can be harder to succeed online. When selling online, sending discounts or marketing emails after their first purchase can be a great way to cross- or upsell post-sale.
3. Make sure it is relevant to the customer
The more personalized, the better! 59% of shoppers who experienced personalization during their shopping said it influenced their purchase decision. When using cross-selling, be strategic about what you’re suggesting. The more personalized you can get, the better!
Also, be sure to steer clear of suggesting products that increase their (current or past) order by more than 25%. You want to be able to capture their attention without implying that they should spend outside of their budget.
4. Demonstrate the value
We’re all suckers for a good deal. If sizing up is a better price per pound, be sure to lead with that! Customers want to ensure they are getting the most bang for their buck. Include price per pound or value for money information in the product description or label so that the information is easy to find for the customer. The more information you give upfront, the better!
Watch out for upsell fatigue
Always be mindful of how often you’re “selling” your customers. Sending too many marketing emails can deter a customer from shopping with you again. Find your marketing “sweet spot” to ensure you are still reaching your customer base and not ending up in their spam folder.
Everyone is looking for more ways to increase their average order size. For more ways to include upselling and cross-selling into your sales strategy, download our resource:
9 Ways to Increase Your Farm's Average Order
Make more money from your existing customer base using these simple strategies.
Running your business is hard work. We want to help make it a little bit easier.
Try Local Line for yourself for free today!
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