Tuesday, January 21, 2020

What is Cross Selling and How Does it Improve CX?

Erin Ollila
June 27, 2019

3 minute read

Think about the last purchase you made. Were complementary items suggested to you as well? Maybe you wanted to buy soccer cleats and the salesperson or website recommended also adding new shin guards and soccer shorts to your purchase. Did you buy them? If so, you just participated in cross selling.

Wait, what is cross selling? If the term is unfamiliar to you, take a moment to learn about a process that not only benefits you as a consumer, but also helps any company that sells goods or services to provide a more quality customer experience (CX).

What is cross selling?

Cross selling occurs when a complementary service or product is introduced as an option for purchase to a customer in addition to what they were originally trying to purchase.

There are many reasons brands and businesses find value in cross selling. First, and most obviously, is increasing the bottom line. If your customer is looking for one item, chances are they will also need related items, too. Hubspot reports that businesses are 60-70% more likely to sell to established customers. However, increasing revenue isn’t the only perk.

Salespeople and brands who practice cross selling add value to the customer experience and relationship. By offering like items that are complementary to the sale, or completely different options you know will benefit the customer based on a conversation you’ve had about their needs, you can successfully cross sell, and they can leave the transaction knowing you’ve gone out of your way to provide insight, value, and perfectly-timed products and services in a way that helps them.

Plus, Harvard Business Review reports that attracting and selling to new customers costs between 5 to 25 times more than keeping existing customers happy (and buying).

Don’t mistake cross selling for upselling

Quite often, cross selling is mistaken for upselling — a similar, yet different sales process. Upselling occurs when a customer is presented with add-ons, upgrades, or enhancements to what they were originally considered buying.

Let’s consider the example of a jewelry store. Someone walks in looking to buy an engagement ring. He had his mind generally made up as to what he’s looking for in the ring. If he leaves with a bigger stone and upgraded setting, he was upsold. However, if the transaction ends with him buying the ring he originally wanted, but also a necklace to surprise his future wife with on the morning of their wedding day, then he participated in cross selling.

Need a simpler example? If you’re shopping for shampoo and the salesperson suggests a more expensive brand, that’s upselling. If she reminds you to also get conditioner or a different hair product, she’s cross selling.

What is cross selling in relationship to CX?

Cross selling isn’t a “sleazy” sales technique or just another way to boost the bottom line. Instead, it’s a way for a salesperson to provide more value to the customer, which in turn improves customer experience and makes them more loyal. Cross selling helps customers avoid forgetting complementary items they might have hoped to purchase in the first place. It also helps to educate them on options. When cross selling is used as a bundling technique, it can also help consumers get better discounts on their overall purchase.

Erin Ollila
Erin Ollila believes in the power of words and how a message can inform – and even transform – its intended audience. After a 12+ year career in human resources, she's jumped headfirst into digital strategy. Erin is a geek for SEO and all things social media.
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