Every retailer wants to make the highest number of quality sales possible. One way to accomplish this is by incorporating retail upselling techniques (also called suggestive selling) into your overall sales strategy.
Upselling is not a new tactic in the retail world, but the transformative digital technologies available to today’s retailers provide new opportunities for implementing upselling with unprecedented success.
Join us as the professionals at JRTech take a look at 12 upselling techniques in retail that can be made even more effective thanks to recent developments in digital technology.
What is retail upselling?
Upselling is a sales technique employed by businesses to encourage customers to purchase a higher-end product, upgrade their existing purchase, or add extra features or services. It involves offering customers a more premium or advanced version of the product they intend to buy, thereby increasing the overall transaction value. The primary goal of upselling is to enhance customer satisfaction and increase sales.
Upselling in retail is an effective strategy because it leverages the customer’s existing interest and intent to buy, steering them towards a better, more comprehensive solution. By highlighting the additional benefits, features, or quality of a higher-priced item, businesses can convince customers that the upgraded option offers superior value for their money. This process is often facilitated by well-trained salespeople or through targeted marketing efforts, both online and offline.
Why suggestive selling is important
In essence, upselling benefits businesses by increasing revenue, improving customer relationships, and creating a positive brand image. It also benefits customers by enhancing the overall shopping experience and ensuring they receive products or services that best suit their needs.
- Increased Revenue: Upselling naturally boosts a company’s sales figures by encouraging customers to spend more. This additional revenue can be crucial, especially during economic downturns or when trying to fund expansions and improvements.
- Enhanced Customer Satisfaction: If implemented effectively, upselling focuses on offering customers products or services that align with their needs and desires. By suggesting complementary or upgraded items, businesses enhance customer satisfaction. Satisfied customers are more likely to return, leading to customer retention and loyalty. By recommending products that genuinely enhance the customer’s experience, businesses demonstrate their commitment to customer-centric service, leading to positive feedback, referrals and customer loyalty.
- Competitive Advantage: In a competitive market, businesses need to differentiate themselves. Offering personalized and value-added upselling options can set a company apart, creating a unique selling proposition that competitors may lack.
- Optimized Inventory Management: By promoting specific products or services, businesses can manage their inventory more effectively. Upselling allows companies to focus on selling particular items, preventing overstocking and minimizing waste.
- Cross-selling Opportunities: Upselling often opens the door to cross-selling, where customers are introduced to complementary products or services they might not have considered. This expands the customer’s understanding of the product range, potentially increasing their overall spending.
When done ethically and with genuine consideration for the customer’s needs, upselling can result in increased customer loyalty and long-term relationships, as customers appreciate the personalized attention and guidance provided by the business. Let’s take a look at 12 examples of upselling that can be supported by digital technologies.
1. Mention special sales and offers
One way to upsell products or services is by presenting customers with special offers and sales. To make this type of upselling effective, communication is key.
Online promotions can be brought to the consumer’s attention by an experienced marketing team (either in-house or outsourced) and by digital advertising.
When it comes to promoting sales and discounts in-store, technology like digital signage is key to getting your message across clearly, to the right customer at the right time and place. It’s worth taking the time to develop quality messaging systems to implement in-store upselling, as customers’ attention spans are short and a poorly-constructed upsell via a digital platform could even do more harm turn good, and turn customers off.
2. Bundles and buy-more-save-more opportunities
When it comes to bundled and buy-more-save-more promotions, it’s important to make it easy for consumers to find the products that are grouped together for sales. This type of upselling only works if consumers can quickly and easily find the ‘extra’ products they are looking for.
Embrace the digital transformation and implement IoT in your retail space to make your store run smoothly and improve customer experience. This will make additional sales more likely due to an efficient and customized shopping experience. Logistics are key.
3. Customer rewards programs
Customer rewards programs like points systems are a great way to encourage consumers to spend more at your retail outlet. These usually involve accumulating points for every dollar spent, which can be put toward a freebie, purchase or gift card.
Customer rewards programs require that you communicate to customers exactly how many points they will be getting on each sale, and an effective way to keep this information readily available and easy to understand is through the use of Electronic Shelf Labels. These labels do much more than show prices in a digital format. They can display other types of information too, including brand information and points rewards, as needed.
Customer reward programs also involve data management on a large scale. Consumers will not be able to cash in their points unless they have been accurately tracked and associated with that individual shopper. It is therefore imperative to rely on digital technology like GHGH software to make this type of upselling viable.
FOMO, or Fear Of Missing Out, involves making the most of a sense of scarcity or urgency to motivate customers to buy more. There is a fine line that must be respected when it comes to this suggestive selling technique: go too far and you could be engaging in unethical practices. But if you respect the limits of this method and stick to tactics like ‘today only’ sales, easily presented and adjusted through the use of digital signage, FOMO can be an effective and legal way to boost sales.
Accurate pricing is essential to FOMO upselling. If customers are not convinced that they are really getting a deal, due to inaccurate price labelling or signage, your efforts could do more harm than good. Retailers can rely on Electronic Shelf Labels to provide accurate, up-to-date information about promotions and regular prices, which is instantly communicated to your POS system so there are no ugly surprises at the check-out. It’s one of the many benefits of implementing a comprehensive digital retail solution.
Clienteling is all about treating customers like the people they are, and not just consumers. It’s the basis of developing long-term relationships with your clientele and developing customer loyalty, which will lead to repeat traffic and purchases.
Effective stock management is key to clienteling. Faced with a stockout , many consumers will not only take their business elsewhere to fulfill their needs at that moment, they are also likely to change their shopping habits and avoid your store entirely. When implementing an upselling strategy, be sure that you mange your inventory effectively with the help of digital technology like Electronic Shelf Labels so that you can be sure that the products you are promoting are in stock and ready to move off the shelves.
7. Don’t offer too many options
‘Choice overload’ exists! If you offer too many options while upselling, you could overwhelm your customers and make them feel worse instead of better.
It’s harder for customers to pinpoint which product they want most if they are too busy trying to sort out their choices. In addition, they could be afraid of missing out on the perks of the options they have not chosen, leading to dissatisfaction rather than a sense of consumer satisfaction. It’s been proven that fewer options result in more sales.
Instead of offering too many choices, focus on assessing your customers’ needs accurately. One way to do this effectively is with Electronic Shelf Labels linked with a complete inventory management system. This type of digital technology permits you to analyse which items are frequently bought together, which items are most popular, and other data from promotions and price changes. A customer data platform will allow you to analyse your consumers’ habits and offer them choices that make them happier to visit your store.
8. Leverage first-party data
First-party data is the key to understanding the relationship between each customer and your business. This is particularly easy to access when selling online, as you can analyse pages visited, products purchased, and a myriad of other behaviors on your ecommerce website. You may even have access to certain social economic information, such as customer location and average purchasing power.
The more you know about your customers, the better you will be able to choose the type of upselling techniques may appeal to them, and when it may be most effective to approach them using suggestive selling. Just knowing whether a customer is likely to open a post-purchase email can allow you to put your time and money into the right marketing channels.
Remember, with the digital transformation in full swing, there are new ways for consumers to interact with a brand, both online and through connected technologies in-store. Every development, such as the recent implementation of grab-and-go shopping, brings a new opportunity for retailers to collect relevant data and implement changes according to what they learn from analyzing that data, quickly and efficiently.
9. Remember to upsell online as well as in-store
Merging online and offline experiences is vital, and having identical promotions can be time-consuming and problematic without the right technology to support your efforts across multiple channels and locations.
By relying on digital systems, retailers can seamlessly implement promotions and upselling efforts in-store and online. Changes can be made quickly, prices updated almost instantaneously. This means that your valued customers can access the same bundles, two-for-one deals and points rewards online as in-store, expanding your reach and potential profits significantly.
10. Showcase your commitment to the environment
When upselling, it’s important to focus on customers’ values and make appropriate suggestions. Adapting your store to broader trends, such as retail sustainability will make your customers more likely to be open to suggestive selling tactics, as they will recognize your commitment to current consumer values.
Digital signage and Electronic Shelf Labels are two of the many environmentally-friendly tools retailers can implement as part of their digital transformation. Gone are the days of printing out labels and posters which would have to be replaced as soon as a promotion or season came to an end. Now, with a few taps, retailers can change prices and update signage, adapting to current in-store and online needs without increasing their carbon footprint. Remember, Electronic Shelf Label batteries last for years.
11. Use visuals to upsell
In the current retail environment, customers expect to be able to see how a product can be used before they will commit to making a purchase. Visuals are essential, and digital signage is here to help, whether you need to display an unboxing video or a detailed set of instructions.
Visuals are also a big part of actual upselling. An effective upselling message should include short copy outlining the benefits of the suggested purchase, an image, information comparing the products in question, and plenty of color to code an easily understandable message.
12. Adjust your upselling tactics to your industry
When you know your industry, you know what your customers want. Upselling tactics should always reflect your understanding of your customers’ needs, priorities and pain points. For example:
- Hardware: Customers need to be informed and advised during the upselling process in hardware stores. By relying on Electronic Shelf Labels for pricing and inventory management, resources can be better allocated to having trained staff who can fulfill consumer expectations when it comes to getting the help they need to make a good choice, especially during labour shortages.
- Grocery stores: It’s no secret that grocery stores display hundreds or even thousands of products on their shelves, each requiring an accurate price tag. Upselling promotions can quickly become complex if these tags are not digitized, as points programs and two-for-one specials demand careful coordination of data and products. Keep your upselling simple, whenever you can, and choose the appropriate technological support for your store.
- Pharmaceuticals: Pharmacies today contain a large array of products, and upselling in this sector is only appropriate for certain items. Knowing which products are likely to be viewed as complementary is vital to successful upselling in this sector, and nothing can replace the efficient data collection of digital tools used for this purpose.
Make retail upselling a success with digital solutions from JRTech
Customer experience is set to overtake price as the defining feature of successful retail. By choosing to upsell with the support of digital technology like Electronic Shelf Labels, you can take your store to the next level and continue to attract the right type of customers with the right type of offers.
The Electronic Shelf Labels market continues to grow as more and more retailers recognize the value of this technology for successful sales and store management.
Contact us today to learn how JRTech can help you move toward creating a digitized upselling experience.