For eCommerce, the Average Order Value has always been the most crucial metric. This presents high-end data for any business owner that shows how much their customers spends on an average in a single transaction. Why we call it high-end data? Coz it’s a figure which can help understand the areas/products to improve profitability by increasing the AOV figure in the long run. One such proven method is by cross-selling and upselling that increases AOV without breaking a sweat and at no additional costs.
Several studies have revealed that with the right upselling strategies, revenue can increase up to 10 – 30% on average, while cross-selling can increase sales by 20 – 30%. Therefore, once you know how to prioritize with the customers’ needs, you can directly see the revenue difference in your business.
Definition of Cross-Selling and Upselling
People often misunderstand the meaning of cross-selling and upselling, and therefore use them interchangeably. However, that’s far from the truth. Cross-selling refers to promoting related or similar products to purchase in conjunction with the primary product. Similarly, when your customer buys a smartphone, you can cross-sell them accessories like wireless Bluetooth AirPods, power banks, etc.
Upselling, on the other hand, means encouraging customers to purchase a premium version of the actual product. Like if your customers are buying a basic subscription plan, upselling would enable them to opt for a higher subscription plan that offers better benefits.
Tips to Increase Your AOV with Cross-Selling and Upselling
Selling customers complementary products or upselling them to an expensive purchase can increase your revenue. However, you have to make sure that you are approaching the entire process correctly. Here are some valuable tips that will help you increase your average order value.
1. Use One-Click Upsell Features
Streamline the upselling process by adding a one-click upsell feature. This helps customers upgrade their purchase or add complementary products with just a single click. This reduces friction and simplifies streamlining the buying process. Key benefits of one-click upsell include:
- Minimizes cart abandonment rates
- Enhances customer convenience
- Increases AOV by encouraging fast decision-making
For instance, after your customer adds a smartphone to the shopping basket, one click upsell could prompt them to add a protective phone cover or case without navigating away from checkout.
2. Segment Your Customers for Personalized Recommendations
How can you effectively cross-sell and upsell if you don’t know your customers? First things first, you need to segment your customers based on their browsing patterns, purchase history, demographics, and customized recommendations.
- Use the analytics tools to group customers with the same interests
- Use AI to interpret customer preferences and patterns in their behaviour
- Product suggestions, personalization for multiple customer segments
Personalization significantly increases your conversion rates and improves customer satisfaction by offering tailored experiences that meet individual preferences.
3. Use Shopify Upsell Apps
If you own a Shopify store, you can take advantage of the Shopify upsell apps that automate cross-selling and upselling. These apps offer customized features to create bundles, recommend products, and display dynamic offers. Key features of the best Shopify upsell apps include:
- AI-powered product recommendations
- One-click upsell functionality
- Analytics to monitor upselling & cross-selling performance
Using the right Shopify app can ensure seamless integration and an improved shopping experience for your customers.
4. Use Product Bundling for Cross-Selling
Product bundling is one of the effective cross-selling strategies where complementary products are packaged together at an affordable price. This approach makes customers perceive the high value of purchasing the bundle compared to individual products. For instance:
- Offering a camera with a carrying case and a memory card
- Creating skincare kits combining a moisturizer, cleanser, and toner
You can also highlight the key benefits of your product bundle to motivate customers to add it to the cart.
5. Add Timely Upselling Offers
Timing is important when upselling. Customers can consider an upsell when they are engaged in the purchasing process. You can place upselling offers at:
- Product Pages: Suggest an upgraded version of the product they are viewing
- Cart Page: Offer a premium version before checkout to emphasize the benefits
- Post-Purchase Pages: Provide extended warranties or upgrades after the initial purchase
For instance, when a customer adds a smartphone to their shopping basket, suggest the latest version with premium features at an affordable price.
6. Highlight Value in Upselling
Customers can accept upselling offers if they see the value of the products. You can value upselling by focusing on:
- Exclusive Features: Showcase the benefits of premium versions of products
- Cost Savings: Provide discounts on upgrades or higher-value products
- Long-Term Benefits: Describe how the premium version can enhance your customer experience over time.
For instance, upselling to a high-tier plan in a SaaS-based business could focus on benefits like advanced analytics, additional storage, or customer support.
Conclusion
Cross-selling and upselling are not only ways to increase revenue. They provide an opportunity to enhance the customer experience by offering value-added products. By paying attention to personalization, smoothness of purchase, and value-based offers, you can create a seamless customer shopping experience. You can also enable your customers to spend even more while having neither hassle nor friction.
Choose platforms like Simplified Checkout to enhance your cross-sell and upsell activities and see results in your eCommerce business. They help you add a set of 1-click upsells, cross-sells, and downsells in your checkout process. By using these platforms, you can improve conversion rates, create customer loyalty, and gather great information to improve your online sales process.
