What Is Cross-Selling?
Because of that, there are four primary benefits that come from cross-selling:
- Increased customer lifetime value (LTV). In addition to immediately increasing the average order value, cross-selling has been shown to increase return customer rates and repeat purchases, thereby increasing customer lifetime value and lowering customer acquisition costs.
- Fulfills all purchase requirements. Products often live within an ecosystem with a single product at the center and additional utilitarian and supplemental products on the periphery that make the sale feel complete.
For example, smartphone buyers may require a case, screen-protector, and replacement plan to feel secure in their purchase, while bluetooth headphones, a wireless charging dock, and car mount may be bought to get the most enjoyment from the purchase.
These additional products usually have little purpose outside of the core purchase, however can be perceived as incredibly valuable within the context of that sale. This is why supplemental products such as Bluetooth headphones with a smartphone are positioned as impulse purchases, as they’re more likely to be purchased with another product than on its own.
- Predictably move related inventory. Businesses may cross-sell by bundling related products so customers will purchase multiple items at once.
While convenient for the customer, bundling has wider implications across the entire value chain.
For instance, because bundled items are intertwined, the company can build more predictable sales forecasts and inventory management strategies than products that do not lend themselves to cross-sales.
- Cross-selling provides options for strategic spending on paid advertising. To prevent prospect burnout and overexposure, businesses may cycle through periods of spending on new customer acquisition and getting those customers to repurchase by cross-selling.
For example, a business may run an acquisition campaign for a month, then use retargeting ads and emails the following month to encourage repeat purchases from those newly acquired customers.
It also offers a path to profitability when new customer growth isn't an option. This can be used as a way to sustain through economic downturns, however, businesses must be strategic with their spending and aware of the diminishing returns of only selling to existing customers.
|Cross-Selling Example||Upselling Example|
|B2B SaaS||Add product training or premium support||Offer a multi-year renewal contract at a discounted rate|
|Insurance||Life insurance added for a customer buying a car policy||Expanded liability insurance for a homeowner who added a pool|
|Electronics Retail||Add a surround sound system for the full theater experience||Suggest an upgraded, higher resolution television model|
|Travel||Suggest sightseeing tours and other services at the destination||Offer a luxury suite at the hotel chain the customer frequents|
|Consulting||Purchase in-person workshop for employees to learn from the consultant.||Offer discounts per unit for buying consultant’s book in bulk.|
|Core product||Secondary product|
|Digital camera||Memory card, camera bag, tripod, camera lens|
|Television||Surround sound, Bluray, wall-mount, cables|
|Mattress||Box spring, frame, bedding, headboard|
|Sofa||Throw pillow, blanket, end-tables|
|Suit||Dress shirt, tie, vest, shoes|
Here are just a few places where cross-sale offers may be made:
Thank you page
Internal search result pages
Order confirmation emails
Shipping notification emails
Regardless of which surfaces products are being promoted on, the most important factor is the underlying technology is giving the most relevant recommendations possible.
With Linkedin Sales Navigator, teams can:
Tailor outreach by creating prospect lists based on company size, industry, and level of seniority.
Save leads to lists and monitor conversations on the open web.
Set alerts to keep track of industry news and trends.