Would you like to generate 10% more revenue?
How about 30%?
Obviously, you would. In fact, those percentages are how much extra you could add to your bottom line — or paycheck — by upselling. Companies that consistently upsell typically generate as much as 95% of their revenue from upsells and renewals!
Read on for strategies you can incorporate today.
Upselling Strategy #1: Personalize. Then Predict.
Be honest: How much time are you actually spending really understanding your prospects?
The truth is, asking harmless questions is how you can sell extended warranties.
If a customer mentions they’re taking a long summer road trip or have a long commute to the office, that could be a green flag to follow up with them later to offer a package with roadside assistance. Or, since you know their VIN, you can send them an email reminding them of maintenance they should be performing at certain mileage milestones.
And since they (probably) don’t have a flagship warranty, you can mention they’ll be covered for certain failures that typically happen around then if they upgrade.
Upselling Strategy #2: Bundles of Fun (and Revenue)
Internet and cable. Burger and fries. Home and auto insurance.
We’ve all bundled something.
Because. It. Works.
Our industry isn’t any different.
Now, the most obvious way to upsell in the extended warranty world is to get prospects to bite on an auto and home (or home and RV) bundle.
But if you don’t have any takers upfront, you can sweeten the deal by including proactive services.
Here’s how it works:
If a customer is balking at bundling, you could include two free complimentary visits from a pest control company or HVAC servicer. Maybe even a coupon for a free oil change once a year.
Why This Matters: Showing you care about the maintenance of your customers’ most valuable possessions elevates your esteem in their eyes, causing them to “stick” with your company, leading to autopilot revenue.
Bonus: You can generate multiple quotes for the same prospect or client, even at a later time with Inline CRM!
Upsell Strategy #3: Narrow Your Focus
You can get a sense for how much (or little) your prospect will probably feel comfortable spending early on.
So, why would you present all the available options when two or three at most are what they truly want? Pushing for anything more wastes everyone’s time and it can make you come across as pushy.
Even worse, you’re inviting the ever dreadful “analysis paralysis.”
Case in point, The New York Times published a fascinating article on the effect choices had on purchases at a food market in California. They found that booths with:
- More choices pulled in 60% of visitors, but generated only 3% of buyers.
- Fewer choices pulled in 40% of visitors, but generated a sale 30% of the time!
You don’t need to be a math whiz to know which booth had a fuller register at the end of the day.
Why This Matters: The saying “More is less” couldn’t be more true. Hone in on realistic and relevant options for your prospects. The more you overwhelm, the more likely your sales are to underperform.
Upselling Tip #4: Give Them Dummy Options
Based on what you just read, you’d have to be a dummy to try upselling too many things at once.
But at the same time, you’d have to be a real dunce if you didn’t make one of your options so unreasonable that you weren’t guiding your prospect or customer towards a decision.
Case in (not ironic) point: The Economist, known for intelligent reporting, ran an ad offering three subscription levels:
Does anything stand out in terms of a bad choice? MIT students thought so, too. Precisely 0% of students said they would get the print only subscription (the dummy choice).
Now, here’s what happened when the dummy choice was removed:
This suggests that an inferior or cheaper choice makes one that is superior look better — even when alternative options are cheaper.
Why This Matters: Counterintuitively, you can close more seemingly “sure fire” sales if you present a prospect with a “No way, Jose” option. And then focus on these now-clients to upsell later.
Upselling Tip #5: Write a Sales Script for Upsells
How many sales scripts do you use?
Hopefully at least one, because companies that stick to theirs attain their quotas nearly 10% more often than those who don’t.
Now, try this, assuming you use a sales script: Think back to when a prospect was warming up to more comprehensive (and expensive) coverage out of nowhere. Were you caught flatfooted? Were you able to accurately convey why they should buy this instead of that?
We recently wrote about what you should include when building a winning extended warranty sales script. But if you want to prepare for every call, you should include multiple “If/then” scenarios, especially how to guide the conversation if someone is buying what you’re upselling.
And yes, you can build out a practically infinite number of sales scripts with Inline CRM to test messaging for what does and doesn’t upsell.
Why This Matters: The more relevant you can make your products appear — especially when a customer is on the edge of making a decision — can mean the difference from a sale won or lost. Having proven, documented wording in your script can seal the deal.
And There You Have It
You should feel more confident and competent about flexing those upselling muscles. And if you want to maximize your success rate, go on and take a free test drive of Inline CRM.