This is the second in a series of feature articles on the above subject which covers the following:
- Up-sell
- Down-sell
- Cross-sell
- On-sell
- In-sell
In the previous article I covered the subject of up-selling and predicted that if you read the articles slowly and carefully, answer the questions I pose with due care, and equally importantly set aside time and actually implement your answers then you will probably double (or more) your revenue within twelve months.
In this article I’m going to cover the Down-sell, Cross-sell and in the next article I’ll cover how to On-sell and In-sell.
Firstly though a quick reminder of the up-sell
Making a sale to a new client is estimated to take five times the effort and cost four times as much as making a sale to an existing client.
However all too often the seller (you) is so excited/pleased/relieved to get a sale that they (you again) forget to offer an up-sell.
At one stage of my career I ran sales teams and for a few years towards the end of that business I had almost 100 salespeople in my team.
And so naturally I have collected more than a few stories over those years.
One that stands out is the salesperson (actually a darned good one too) who told me he made a small scale term insurance sale to an established client.
After he signed the contract they both stood up, shook hands and the client began to walk out of the salesperson’s office. Just before the doorway the client turned around and asked “I guess you don’t sell income insurance?”
The answer was of course “Hell yes!” The client sat back down again and bought not one but two large contracts.
The point is this: even professional salespeople need a system to remind them to up-sell etc. That particular salesman nearly lost out on a thousand dollars of commission and that was just one case in a year of perhaps 200 other sales.
Hopefully that helps you to realize the money that’s often “left on the table” when we (you) fail to offer more products or services after someone has made the decision to buy.
The Down-sell
If you go into a bedding shop it’s common for the salesperson to ask you to lie on the most expensive mattress first.
The reason is very simple: if you like it you may decide to buy it but more likely you’ll want to try the next most expensive one just to confirm your decision and to see if a cheaper option might do the job.
Either way there is a much better chance of you buying a more expensive mattress if you start with the most expensive mattress than if you had started with the cheapest one and worked your way up.
The mattress is one example of down-selling and it reinforces an obvious but often neglected point: you are better to have a range of products/services that are priced at different levels so that if someone does not want your premium product you’ve still got a shot at them buying something else.
All the big, smart companies do this: car companies, department stores, restaurants and so on. By implication, if you have something to Up-sell then it’s likely you’ve got something to Down-sell.
For example if you manufacture pies you may have a standard one and then gourmet varieties at difference prices points. You may also offer retailers bundles of 20, 80 and 200 at different price points.
By the end of March this year this is what my product list will look like:
1. Free stuff including my Blog and Social Media
2. A 30 day “101” online marketing course for $7
3. Killer Marketing Insiders Report $50 per year
4. Killer Marketing Club (you’re in it!) at $67/mth
5. New Clients NOW! Program at $397
6. Strategy Boot Camp $795/mth for 6 months
7. One on one coaching at $1,000 – $3,500 per month (depending on company size)
8. Mastermind Group Coaching
9. Various online store products
10. Conference speaking
11. High priced consulting for larger companies or associations
12. Earned Equity Program
And whilst it’s not technically a part of a product funnel, I also offer and derive income from Joint Ventures and other hosts.
Someone who doesn’t know me from a bar of soap, as we say in NZ, may choose to dip their toe in the water and start with the free stuff.
Hopefully they’ll eventually go further and try my Killer Marketing Club and then the Strategy Boot Camp
(BTW: Please bear in mind that when I started this business three years ago I launched with just one of the 12 levels so please don’t feel you have to develop your range of overnight.)
The main point to having so many levels of product choices in what is a relatively small business is this: maximize every opportunity to Up-sell and Down-sell.
The second and also magical thing that happens when different people select one or another product level is the synergy that seems to take on a life of its own.
Next month I present to hundreds of UK vets. That opportunity came from an enquiry by someone who had subscribed to my free Ezine for almost two years and one day. Out of the blue, they asked me if I would present and “you are very welcome to offer one of your products at the end”. (Try and stop me!)
But unlike an Up-sell, a Down-sell does not necessarily involve money changing hands.
This morning I had an email from “Sue” who, from her email, I suspect would be a good quality client for the 80-20 Center.
She explained that she’d looked at an offer on my website and decided not to buy at the moment.
From my side it’s like “Hey, no problem, thanks for letting me know, in the meantime we’ll keep you subscribed to our free stuff”.
(I have in fact, got the full response on a macro key so I can respond to such emails with the push of two buttons.)
Having something free that goes out regularly (ok, semi regularly) is another opportunity to continue nurturing a relationship with Sue until the time is right for her to buy.
Have a think firstly about your Ideal Client and then what products or services you can add to your range that would firstly give prospects a point of entry that suits their timing and budget as well as giving you lot’s of Up-sell and Down-sell opportunities.
The Cross-sell
Marketers define the Cross-sell in many different ways but most would agree that there are two main types.
Firstly a Cross-sell occurs when a client, who by definition had already bought, buys a complementary but (normally) similarly priced product.
The second broadly accepted type is where one company sells its products/services to another. This often occurs after a merger of two companies who have a similar Ideal Client profile but complementary products.
For example if an accountancy firm merged with financial planners then the clients of each would market their services to the other’s database.
Unless a merger takes place the latter definition is also referred to as a Joint Venture which is the subject for a different day so I’ll stick to the first definition.
A company that employs a range of natural therapists would be smart to maximize the cross-sell opportunity, whilst being helpful to the client, and have the acupuncturist referring to the naturopath or the osteopath or the sports masseur or the Chinese herbalist and visa versa etc and so on. (You get the idea?)
Once again, sit down and think about Cross-selling opportunities for your clients.
You can even introduce a system for offering clients a complementary product/service from another business that will add value or enhance what they have bought from you. For example the seller of a mobile phone may recommend a network and receive a commission if the client agrees.
Another example: a franchise lawyer creating an agreement for a client can (if it’s in the best interest of the client) refer the client to another lawyer in the firm who specialized in trusts or in wills.
Some people balk at the idea of suggesting a client spends even more money. Personally, I think that in examples such as the last one, a lawyer would be professionally negligent if he/she did NOT recommend that the client digs deeper in their pocket.
If you have a team of well trained people who operate using proven processes then adding new products or services is relatively easy.
If however you’re more self-employed or a “one man band” then try and think of adding digital or physical products that you can sell to existing clients.
The bottom line is that regardless of how you do it, adding to your product range so you can up/down and cross-sell is a profit-maximizing strategy.
