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This is Stuart Webb Business Success Mentor, Author, Podcast host, Speaker, CEO and Founder of the Complete Approach - with another one take video blog - all the mistakes stay in
“Medium or large?” “Would You like an extra shot?” “Burger with cheese?” “Would you like extra cheese on your pizza?”.These phrases add millions to the revenue of Mcdonald’s, Starbucks, Burger King, and Dominos.
This sales technique of encouraging customers to buy a more expensive version of a product has been used for decades in disguise of increasing customer satisfaction. Some call it the ‘best value offer’, some call it the ‘most popular choice’, while some give it more enticing names like ‘just for you’ or ‘recommended for you’.
Types Of Up-sell
Here are seven types of upsell.
1. Deluxe Up-sell
This is my favourite. Several of the examples above are based on the ‘Deluxe Upsell’. Remember, the deluxe version needs to be packed full of additional benefits and the net cost needs to be small in comparison to the extra price charged, leaving a healthy increase in profit. Virtually every business can create a Deluxe Up-sell with very little effort.
2. Two or More Items Discount Up-sell
Just like Tesco, you can offer a discount for buying more than one of the products or services. Remember, the key here is to ensure that the profit is greater than if they are buying just one of the products or services. A simple example…
Discount Up-sell Examples Price Profit
Product A 10.00 5.00
Discount Up-sell Price for 2 17.50 7.50
Discount Up-sell Price for 3 25.00 10.00
3. Buy 2 Get 1 FREE Up-sell
This classic up-sell offer again works well, but be careful to choose a product or service that allows you to increase the profit on the sale. Remember, the up-sell here is to get the customer to buy two as opposed to one product or service. Here’s an example…
Buy 2 Get 1 FREE Example Price Profit % Profit Profit Increase
Product A 50.00 30.00 60% -
Buy 2 Get 1 FREE 100.00 40.00 40% 10.00
The key here is that although the profit margin decreases, the actual profit on the sale increases by £/$/€10!
Notice if the profit is 50% or less – you can’t use this up-sell, because at 50% profit there is no increase in profit (the only reason for using an up-sell)…
Buy 2 Get 1 FREE Example Price Profit % Profit Profit Increase
Product A 50.00 25.00 50% -
Buy 2 Get 1 FREE 100.00 25.00 25% 0.00
4. Time Up-sell
If you're selling a product or a service people subscribe to, like a magazine, you could tell them if they subscribe for two years instead of one, they can receive it half off the cover price.
5. Quantity Up-sell
This is similar to the discount up-sell. The difference here is you increase the discount by how many products they order. If they order three, it's a 10% discount, if they order five, it's a 15% discount.
6. Package Up-sell
You could offer similar products as a package deal. Tell your customers the other products are cheaper with the package deal versus purchasing them separately. For example…
Package Up-sell Example Price Profit
Product A 100.00 40.00
Product B 70.00 40.00
Product C 50.00 30.00
Product D 30.00 10.00
Total Cost If Bought Separately 250.00 120.00
Package Cost (all together) 190.00 70.00
Don’t make the mistake here of thinking that by packaging the products or services together you’re reducing the total profit. Remember, the key is that customers will rarely buy all the products separately so you’re increasing the actual profit per customer.
7. Extended Up-sell
If your product comes with a warranty, you could ask people if they would like to extend the warranty one more year for only £/$/€xx.
OK that’s it for today. If this is helpful please comment and why not get a review of your newsletter (or start one) with our Scientific Marketing Review
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