It makes sense logically, but in case you need extra convincing, here’s what the experts say about repeat business and up-selling:
The best way to make more money from your wholesale business is to sell larger quantities at a higher price, more often, to your most loyal buyers.
- Repeat customers spend 33 percent more than new customers.
- 70-95% of revenue comes from up-sells and renewals on average.
- Up-sells are 68% more affordable than capturing a new customer.
One of the best ways to increase revenues for your wholesale brand and foster ongoing relationships with customers is to focus on up-selling to your buyers.
This article will provide a closer look at what up-selling in the wholesale industry is, how it differs from cross-selling, why it’s essential, and give you insight into some up-selling best practices.
What is up-selling?
Yes, what is up-selling? Up-selling is the practice of offering a better or more expensive product during a sales interaction with your buyer. An up-sell results in an increase in the buyer’s overall order than if the buyer didn’t upgrade to a premium product.
For example, J.Crew often sells solid versions of sweaters for a lower price point than print versions. You might do the same.
If a buyer was purchasing a bulk order of solid-colored sweaters from you, you might consider up-selling higher-priced cheetah, polka dot, striped, and gingham patterns. If the buyer bites, your overall purchase price skyrockets. That’s up-selling.
What is the difference between cross-selling and up-selling?
Cross-selling is another way to boost the overall price of a buyer’s order, but the technique is slightly different. Instead of asking the buyer to upgrade to a premium or luxury version, your strategy is offering complementary products.
For example, if a buyer is interested in buying a bulk order of high-quality ties from your brand, you could offer tie pins and pocket squares. These products go well with ties and would provide an additional sales opportunity to a retailer. The best part is, if this cross-sell is successful, you boost the order total.
As a quick review, up-selling would mean asking your customers to buy a more expensive cashmere tie collection, instead of the cheaper cotton ties they were checking out at the beginning of your meeting.
It’s also worthy to note that it’s possible to up-sell and cross-sell within the same interaction. You could offer a cashmere tie collection instead of the cotton collection as an upgrade and suggest your buyer purchase tie pins.
Why is up-selling important?
The most apparent reason why up-selling is essential is to increase your sales. But, that’s not the only reason up-selling is critical, and not even the most important reason.
Up-selling provides an opportunity for you to connect with your buyers in meaningful ways. When you take the time to get to know your buyers’ businesses, anticipate what they need, and learn how you can provide more optimal services, you build a more reliable, trusted, and enduring relationship.
An ongoing and seamless relationship is valuable to your buyers because they don’t have to do the additional product research and rely on you to meet their needs with every virtual sales appointment. It’s valuable to you because it fosters customer retention, increases the customer lifetime value, and increases revenues. Everyone wins.
What are some up-selling best practices for wholesale brands?
Have you ever been on a sales call, and before you’re about to hang up, the sales rep quickly tries to offer a random upgrade? This approach rarely results in a sale and instead can push customers away.
Here are some better ideas, especially for wholesalers:
- Research your buyer before your virtual meeting and customize your virtual showroom and store to their needs.
- Talk to your buyer about who their customers are, and what their purchasing and reselling goals are. Then, make recommendations based on what they tell you.
- Offer an up-sell when it makes sense in the conversation, not as an afterthought before your meeting ends.
- Display only relevant recommendations in the online catalog. Leave other marketing distractions out of the virtual showroom.
- Follow up with email or free additions to encourage ongoing sales and relationships.
Remember, up-selling is a process that benefits both your brand and your buyer’s business. The more you can do to learn their needs and offer relevant up-sells, the more successful you will be.
Wrap Up
Up-selling is the practice of asking your buyers to upgrade to premium or luxury products from your brand to increase the order's overall price. Up-selling is a surefire way to increase your revenues and hit your sales goals more quickly.
As you gear up to present, sell, and up-sell your products in a virtual showroom, make sure you have tools like NuORDER that will help streamline the buying and up-selling processes.
