The Benefits of Upselling to Existing Customers
Posted on April 06, 2018
When running a business, there are different ways in which a business will promote its wares, including the cross-selling of products. However, it’s important not to get the term confused with upselling. Whereas cross-selling allows businesses to offer products or services of similar value, the art of upselling means promoting a premium service over the more conventional offerings.
When looking to make sales, there can be a lot of benefit in upselling to existing customers. Although you shouldn’t discourage new customers, it’s important that you don’t undervalue the value existing customers can bring when marketing a product or service.
Existing Customers Are Already Familiar with Your Brand
When trying to win over new customers, there’s more than the product or service to promote. Regardless of whether today’s consumer is looking to buy a new television or employ the services of a marketing company, often, customers will look at reviews before making a purchase.
Existing customers have had time to become more accustomed to your brand, and therefore will have developed some form of relationship, as opposed to those who have never had dealings with the company before. Given the fact that most will have already tried out your service or product in some manner, the upselling of more premium services or goods should be relatively straightforward.
A Business Will Better Understand Its Existing Customer Base
Nowadays, there are several tools available that allow you to better understand the mindset and buying habits of your customer, the most popular being CRM software. Depending on your business model, you can use this software to find out what a customer visits your site, their purchasing behavior, and when they’re most likely to make a purchase.
As a business can build a more in-depth customer profile, it is able to tailor its marketing when upselling to ensure that a purchase is almost definite.
Lower Marketing Costs
There will be times when a business doesn’t always have access to capital to fund a major marketing campaign, but these costs can be reduced when marketing to existing customers. In fact, in most instances, marketing to new customers can cost five times more than upselling to existing customers.
To be able to upsell to existing customers, it’s important to maintain a relationship with customer. This could be sending them marketing emails with products that appeal to them or reaching out to ensure they have been satisfied with the service provided in the past.
It can be easy to dismiss how important it is to appease existing customers, but when it comes to the bottom line, it’s a strategy that’s well worth considering.
The way in which a business communicates with its customer is becoming more and more varied, and if we’re able to use customer information in the right way, a business can ensure that it’s able to maximize its upselling potential.
However, if we only communicate with customers when there’s something to sell, we may find that there is a cold response to any marketing materials. Therefore, it’s important to sustain a relationship with customers, and use the information garnered from past transactions to build a truly valuable customer profile.