Even after you’re secured a sale, the goal is always to increase the dollar amount customers are spending. Should you sell them more expensive products, different products, or both? When considering how to increase the amount your customers are buying, we have to talk about cross selling and upselling.
In this article we will define cross selling and upselling, compare the two types of selling, analyze cross selling in banking, and discuss cross selling tips.
Cross Selling Definition
Cross selling occurs when you sell another product or service that is different from the one you’ve already sold to an existing customer. The products or services you are cross selling should be complementary to the ones your customers are already purchasing.
Cross selling is used in every industry from automotive sales to ecommerce, to banking and salon services. Car salespeople cross sell warranties with the purchase of used vehicles. Recommended items that pop up on a website after you’ve added an item to your cart is an example of cross selling in ecommerce.
What is Cross Selling in the Banking Sector?
The banking sector uses cross selling techniques to their fullest potential. This method of selling helps boost sales for financial advisors, bankers, and tax professionals. In banking, after you’ve established a trusting relationship with your clients, there’s a great opportunity for selling other products you think would be useful to them.
It’s important to note that cross selling in banking must be done properly and knowledgeably. Financial advisors must be mindful of only selling their clients products they can afford and understand. If a financial advisor sells their client on something that ends up landing them in financial trouble, the trust and credibility is gone.
What is Upselling?
Upselling occurs when you try to sell your customer additional or more expensive products in addition to what they’re already planning on purchasing. Upselling is all about selling the value that comes with purchasing the upgraded, better version of a product or service. It usually involves comparison charts to show how much more a customer can get with their money if they purchase up a level.
This tactic is especially useful when selling memberships. By showing a customer a comparison of the different membership levels, they can see how much more they’ll get for their money by choosing a premium membership over a basic membership.
Cross Selling vs. Upselling in Banking
While cross selling and upselling in banking are both useful techniques for boosting sales, they are completely different. They can be used individually or together for maximum results. An example of upselling a banking client would be pitching to upgrade their credit card from the basic, entry-level card to the premier level credit card with higher cash back rates and a longer 0% interest period.
On the other hand, if a banker is looking to cross sell their client, they would pitch them to open a new credit card account to supplement the checking account they just opened. These two products work in tandem with each other. Having a credit card over a checking account isn’t an upgrade or an upsell, it’s a completely different product. The two are related and both add value in their own way.
Examples of Cross Selling in Banking
Let’s review a few banking cross selling examples.
The first example involves a banker working on refinancing their client’s home. After refinancing their home, a banker could offer their client a home equity line of credit, or HELOC. If the homeowner has a healthy amount of equity in their home, this could be an option for them if they’re looking for a loan.
A HELOC is a completely separate service from refinancing their home. The two services are beneficial in their own way. One isn’t an upgraded version of the other, they’re two completely different options.
Our second example involves licensed income tax professionals. When doing your clients’ taxes you’ll obviously have a sense of their income level and potential amount of disposable income. With this information, a tax professional could recommend investment products to their client. The two services are different yet complementary.
Cross Selling Tips
While we’ve primarily focused on cross selling in the banking industry, these cross stelling tips are applicable for any salesperson.
Something helpful your sales reps can do to prepare for selling is to research past sales against the products or services you currently offer. Look at the items people are purchasing and choose other products that complement them.
If you know which items are your bestsellers, learn which items pair best with them so you already know what to offer your customers. This way you don’t have to think of ideas on the spot, you’ll already have an arsenal of items to offer. This can help you come across as more confident, helpful, and knowledgeable.
When you’re selling additional products and services to clients it’s important to show them the additional value you provide as a salesperson and the additional value the products or services you’re selling provide. Cross selling works best when used as part of the consultative sales process.
You’re more than a salesperson. You want your clients to see you as helping make their lives easier. If you can show your clients how the supplement products or services you’re selling will make their lives easier, they’re more likely to make the extra purchase.
Conclusion
Cross selling is when you sell another complementary product or service to an existing customer. The products or services you are cross selling should go well with what your customers are already purchasing.
For example, a client receiving a haircut at the salon might be prompted to buy a specific brand of shampoo sold at the salon. Shampoo is a product that is complementary to a haircut. This tactic is used across all industries, including banking and ecommerce.
Upselling happens when you sell your client more expensive products in addition to what they’re already purchasing. In order to effectively upsell you must sell the value that comes with the upgraded version of a product or service. Comparison charts help show the extra value that comes with purchasing the next level up.
Cross selling and upselling are not the same. Cross selling in banking occurs when a banker sells their client a credit card in addition to the checking account they just opened. Upselling in banking occurs when the banker convinces their client to open the platinum level of a credit card when they initially were going to purchase the standard level instead.
In order to properly prepare to cross sell your clients, you should know which items sell best for you and what items pair well with your best sellers. You want to have this information memorized before a sales call, so you appear knowledgeable and trustworthy.
Another cross selling tip is to focus on providing value instead of just closing a deal. It’s more beneficial to the customer if you truly educate them on the products and services you’re selling them and how they can provide value to their lives.
The definitions, examples, and tips discussed in this article are designed to build trust, boost sales, and create loyal clients. Happy selling!
Recommended Reading: Effective Upselling Techniques to Increase your Sales