How to Upsell Products In Your Store

Getting new customers to make purchases is important. But there are more ways to boost sales and revenue for your online store. Convincing new and existing customers to make purchases with a higher average order value (AOV) or add-on to one in progress may have better results. 

This is called upselling. While upselling may conjure the trope of an unfavorable salesperson trying to sell you something you don’t need, this strategy is actually useful for both business and customer—and there’s a way to do it without appearing pushy. 

There are great benefits to upselling that go beyond increasing your business’s profit margins. Ahead, we’ll unpack some of the specifics of upselling, understand the psychological aspects of why customers may want to buy more, and cover some practical upselling tips and strategies to consider when you want to upsell your products.  

What is upselling? 

Upselling is a sales technique that encourages customers to purchase a higher quality or next generation version of a product. (An easy upsell? Think of any new smartphone drop.) Upselling also includes enticing customers to spend more at a business by offering additional items at a lowered cost. 

The point of upselling is to make that customer’s order more profitable for the business. If many customers select the higher priced product option or add-on to their original cart, that’s good for the business. 

Upselling vs. cross-selling 

Often, upselling gets lumped into another tactic where a business offers similar products to add to a purchase. This is known as cross-selling. Both are effective sales techniques to get customers to spend more. Upselling, in comparison, asks the customer to spend more on an item that they plan to purchase anyway. 

What are the benefits of upselling? 

1. Higher AOV: Upselling means your customer is spending more, which has an impact on the overall order value in that single transaction. Now imagine multiple customers doing this every hour of every day. A higher average order value also leads to better customer lifetime value (CLV) because a customer that spends more (and more often) is a loyal one.

2. Better customer experience: Getting more value beyond the dollar amount they are spending is important to customers. Upselling has the added benefit of focusing on the customer and their personal shopping experience. If a customer feels valued or values the product and experience, they are likely to spend more. 

The psychology of upselling 

Upselling works so well because it’s based on a customer’s existing want or need. For example, say someone’s searching for a new sleeve for their computer and finds a customized, one-of-a-kind design at a higher price point. They’re more likely to make that purchase than at another time, since spending on that item was already in their plans. 

Psychology and consumer buying behavior nuances play a role here. The cost of missing out on the purchase altogether may be worth more than the dollar amount it's priced at. 

Consider the following concepts to understand how and why upselling might be right for your business. 

Perceived value 

An important psychological concept to understand for upselling is perceived value. There is some subjectivity in the value of a product or overall purchase. For some customers who don’t buy often and save their money to make a purchase, the perceived value of a product is going to differ from those who may have more financial means. The reverse is also true. 

Making your product appear more valuable than its actual cost has greater return benefits as customers are highly encouraged to make that purchase. 

FOMO

With the concept of supply and demand, where less supply garners more demand, comes the psychological idea of fear of missing out (FOMO). Think of low stock warnings or limited-time discounts as ways businesses activate FOMO. 

Customers don’t want to miss out on a deal or a product or an experience that everyone else is having. Upselling taps into that, and provides a pathway for the customer to make the purchase. 

Strategies and tips on how to upsell products 

Upselling is a great way to increase business profit but it’s always an incredible way to nurture and build on your relationship with your customers. Think about it: Your customers are trusting you to spend more on a higher quality version of a product you offer. If that experience goes well, they are likely to come back and spend again. 

Consider the following strategies and tips to upsell your products to your customers.

1. Engage customers help you choose items to upsell and when

Your customers can be a great indicator for which items to upsell and when. What do your customers’ buying behaviors look like? What about customer data, including AOV? 

Even performing keyword searches to understand the search terms your customers are using to find products like yours can help you understand what they are looking to purchase. 

Consider, too, how social media and marketing in general can engage your customers in the upsell. Run a poll on your social channel about specific products. Ask them about which products fill a gap or if it’s what they need.

2. Offer a limited-time only discount 

Tap into a customer’s FOMO by putting your product on a limited-time only discount. This upselling tactic is good to start out with because it puts a degree of pressure on your customer to make the purchase without any real pushiness. 

Offer a timeframe with a small discount on the product. They’ll still be making the higher-quality purchase, thus spending more. But on top of FOMO, you’ll capitalize on the perceived value if you offer a few dollars off. 

3. Consider a loyalty program and perks 

Loyalty programs and perks are a great way to engage with your customer and better their overall experience. One way to upsell to a customer is to offer points from their purchase that can go toward a future free item or significant discount on their next purchase. This gives your customer’s perceived value of the current purchase more weight: spend now to save more later (and maybe get a free sample of a product or two.)  

4. Offer free shipping 

For a customer, hitting a certain spend threshold and automatically triggering free shipping is a great feeling. Offer free shipping as a perk of the purchase, after a certain amount is reached, or as a discount code. This is a good way to incentivize the customer with the promise that they’re saving in one area of their overall purchase. 

Learn about setting your shipping rates

5. Try the rule of three

There’s something about options that customers love. This is where the rule of three can help you upsell to your customer without much pressure or lift. 

Offer three carefully selected pricing tiers or products. This doesn’t overwhelm your customer, but it does give them a sense of comparison and choice. The first option is often referred to as the baseline, what your customer would want to spend in any case. The second is a slightly pricier alternative to the first, and the third is the dream selection that costs more.

All three still work in favor of the upsell, not simply the last dream option. Would a customer select the third option if it weren’t there? The point of the rule of three is not needing to know the answer to that question.

The rule of three also works when it comes to merchandising or visually establishing a presence for your products. In-store, groupings of three products that represent the upsell can help customers choose the pricier option. Online, putting three pricing tiers in one table, or three product options with the pricing explained, is optimal so they can compare and make a selection. 

Learn more about pricing strategies

6. Offer product bundling with savings

This upselling tactic has some crossover with cross-selling techniques. Suggesting bundled products that are complementary or personalized to your specific customer and their purchase is another way to sell that product and increase profit for you (and help with inventory management.) 

7. Send a follow-up email

Sometimes customers browse for a product, put it in their cart, and then abandon it. They may do this several times before making a purchase. With the intent there, it’s reasonable to send a follow-up email to them about the product they’ve left behind. 

Email marketing is by far one of the best ways to get your customers to convert. In fact, upsell emails can have an almost 92% conversion rate. 

8. Persistence, not pushiness 

By regularly putting your products in front of shoppers, perhaps through paid ads or email marketing or even banner displays on your store, you’re making the purchase almost inevitable for the customer without actively pushing them to do it. 

Customers don’t like to be pushed into a purchase that they may immediately regret. Upselling is just as much about making a sale at a higher cost as it is about a customer’s satisfaction with making the purchase. They need to feel that they’re the one driving the decisions throughout the process.