Focus on Existing Customers to Drive Growth
Despite what you may have been told, once a customer has purchased a product, the sales cycle is not over. In fact, with the right techniques and approaches, this point can be the start of valuable long-term relationships with your customers.
The average retention cost for existing customers is much lower than the average acquisition cost for new customers. By engaging your customers in marketing techniques such as cross selling and upselling you’re effectively profiting more with each purchase, developing stronger customer relationships, and increasing your bottom line.
With all the benefits associated with these techniques, it’s a huge wonder why most businesses aren’t taking advantage of these additional sales opportunities when a customer has already made a purchase. And the best part is, these techniques aren’t limited to any one industry, and can provide great results when applied correctly to any business model.
In this short guide, we’ll be introducing the concept of upselling and cross selling, the reasons why you should be implementing these techniques, a full outline for creating your own email sequences, along with the top tips and tools to get the most out of your email marketing efforts.
What is UpSelling & Cross-Selling?
Upselling is a marketing technique used to persuade customers to purchase a more expensive, or upgraded product or service; such as the latest model of the product they just bought, additional warranties, or features.
A classic example of this is the iPhone. Say you’re about to purchase the new iPhone 11 at their lowest storage option. You’ll get asked if you’d like to upgrade to the next highest storage option for only $x extra per month.
Cross-selling is a technique used to recommend complementary or additional products to existing customers. Using the iPhone example again, this would be like Apple recommending you a phone case and screen protector after you’ve purchased your new phone, focusing on the improved experience and safety features that comes with making these additional purchases.
Why Use These Techniques?
A big reason why cross selling and upselling strategies are so effective, is that it is tremendously easier to sell additional products to existing customers over customers you’re trying to sell to for the first time. Existing customers are 9x more likely to repurchase from you, while new leads can be 10x more expensive to sell to.
Since email is a channel which you’re already communicating with customers through, it makes sense that crafting sequences specifically designed to cross sell and upsell your customers is the most effective method of doing so.
By consistently offering additional or upgraded versions of products, you’re not only receiving more revenue from each individual customer, but also effectively increasing your AOV (Average Order Value) across the board. Since product recommendations can drive between 10-30% of revenue, you’re simply missing out on additional profits by not offering either an upsell or cross sell with every purchase.
Creating A Successful Upsell/Cross-Sell Email Sequence
While upselling and cross selling can occur both during the sales process, and after purchase, for the sake of crafting email sequences, we’ll be focusing on how to create an effective post purchase email sequence.
Email One: Order Confirmation + Initial Cross/Upsell
The first email you should be sending after a customer makes a purchase is an order confirmation, thanking them for their purchase and providing them with important information.
Depending on the product or service, this can include:
Expected delivery date of product/service
Link to FAQ’s and important information regarding product or service
Introduce related upsell/cross-sell
Confirmation emails have a staggering average open rate of 70%, making this email a perfect opportunity to introduce your upsell or cross sell.
Email Two: Build Excitement & Provide Value
As a follow up, the second email in your sequence should continue to provide value regarding the initial product your customer purchased, as well as build excitement regarding potential re-purchases.
This is important particularly when it comes to maximising returns and continuing to build a strong relationship with your customers. Effective ways to do this can include providing testimonials for the same product, product guides or videos that help them get the most out of their purchase.
This email increases trust that your customer has in you by showing that your brand actually cares about them, as well as increasing the chance of them purchasing again.
Email Three: Reintroduce Upsell with Scarcity Element
By this point in the sequence, it’s more than likely that your customer has begun to use their product or service already, and is a perfect time to reintroduce the upssell or cross sell that you originally proposed in the first email if they had not accepted it already.
By reintroducing the offer with a time sensitive or scarcity element (ex: 25% off for the next 24 hours, or only 10 available units left), you’re setting a sense of urgency with your customers. And if they’ve already been satisfied with their current purchase, it makes them even more likely to seriously consider your second offer.
Email Four: Offer Expired / Cross Sell
In order to build actual trust and credibility with your customers, you have to follow through with your word on everything, even when it’s not in their favor.
This includes closing out an email sequence by letting your customer know that the offer you’ve introduced has expired and is no longer available at the discounted rate or offer that you’ve previously made.
While this is effectively training your customers the element of scarcity first hand, it’s also an opportunity to introduce another cross sell. This is a great time to do so since they may be experiencing FOMO on the original offer.
Tips & Tools
Segment your audience
In order to recommend additional products to customers, it’s crucial to know which ones they are currently using, and how recently they purchased them. This is where segmenting your audience comes into play, and is extremely helpful in knowing which email sequence to send.
Provide consistent value beyond your product/service
As mentioned in the section above, it’s important to provide real value to your customers and not come across as too salesly or automated.
Utilize marketing automation software
Utilizing email marketing automation software is extremely powerful when it comes to these kinds of techniques.
As long as messages stay personable and organic, having an automated response system will effectively be printing you additional revenue when you have a good process in place for upselling and cross selling.
Create clear calls to action
When it comes to getting your customers to spend more money, you have to do 90% of the work for them. This typically lies in creating very clear calls to action.
For example, if you’re marketing a 25% discount on a related product in an email, you should have a button link in that email that will take them directly to the checkout page, with the code already applied.
Track & Improve
As with all marketing strategies, these techniques are not an overnight recipe to success. However, once implemented, keep a close eye on the success of your email sequences. Each 30 day period, it’s helpful to go back and analyze the traction of your campaigns, including these key metrics:
- Open rates
- Conversion rates
- Response rates
If you’re campaigns aren’t performing as you intended, it may be time to tweak the copy, timing, or the offers themselves. It’s helpful to go back and do this once a month to ensure your sequence funnel and targeting systems are working correctly.
If you’ve come this far, it’s easy to see the benefits and additional sales opportunities that implementing a cross sell/up sell email sequence campaign can bring you and your business.
Let’s do a short recap on the key points you can take away to begin to craft and run your own cross sell/up sell email sequence campaigns.
Analyze your customer base and segment by email based on demographics, purchase history, customer longevity, and other key audience metrics.
Compile a list of products, offers, and deals to offer each of the segmented groups through an email sequence.
Plan out your email sequences. It’s okay to put some time into this! For each segmented group, it’s important to have a fully planned and written out sequence, highlighting all of the main points that we touched on above.
If this is your first time experimenting with these types of sales methods and sequences, it may be wise to pick one segment and fully craft and test one sequence before you move on to your other segments.
Run your sequences using an email marketing automation software to ensure response timing and accuracy, and to track your progress and make tweaks to your plans accordingly.
It can be hard to find an email marketing automation software to fit your needs as a marketer, especially when you’re running several campaigns at the same time, and need to keep accurate records of it all.
Inbox Brain is an all in one automation platform that maximizes your replies and sequences through smart automation. Not only can you plan out your cross sell and up sell email sequences easily through the platform, you have the ability to track email open rates and link and attachment clicks across your segments. Try Inbox Brain’s free trial today to see the impact that an effective upsell marketing strategy will have on your business.