First of All:
Before I tell you how to upsell a product, I want to point out that I’m actually not fond of this being heavily used, even if it’s being used ethically. Greed is greed no matter what, and it begets misery in enough time.
The biggest problem is that from a customer’s point of view, it’s either obnoxious, or a trigger on reflexes. Cases of the latter I cannot help but view as exploitation on a small scale. Scale is irrelevant in whether something is or is not right.
It’s annoying to have to constantly tell the ISP or phone company that I don’t want their super gold package with nine trillion satellite channels I will never watch. It’s annoying to tell the restaurant I don’t want to upgrade the size of my meal, or buy dessert.
But, in the latter couple cases, it’s only a little annoying, and business is business. But when it’s aggressive and relentless, it’s just awful.
What Qualifies as Upsells:
An upsell is when a customer is sold an optional additional set of features, or an upgrade to a fancier service, depending on the type of business. The freemium business model for software and web services is built entirely around a special kind of upsell model.
Why Do It:
Well the most obvious reason is, it increases the lifetime value of a customer, whether it’s a service or a simple purchase. More money, in reasonable cases, is a goal a business will pursue, and rightfully so.
But, when it’s handled right, the upsell can actually improve the customer relationship, because they like what they got for a price that at least seems beyond reasonable itself. If this works, and it’s not exploitive, then that’s ok. But it goes wrong on this aspect most of the time.
Things to Do:
Well, the first thing to do is to scrap the frequent calls to customers to ask them to upgrade, along with the constant spam or junk mail. It’s rather obnoxious and makes them want to never submit to an upsell out of annoyance-forged spite.
When you do contact them (because their eligibility changed or a new something has been conceived), you need to incentivize them beyond savings. You need to have a contingency model for your sales representatives so they can dynamically find an aspect of the upgrade that appeals to a given customer type. They need that one thing that is to them way too cool to not pay a few extra bucks for. It could be one of a billion things, and will be all of them for different people.
In fact, this is where you’re going to spend most of your pontification, as it’s going to be a lot of market and demographic research to build your base pitch, and your huge contingency set to run on it.
This is how to upsell a product in a nutshell. If you expected this to be less forward, you should be pleasantly surprised right now. Use this ethically and sparingly, and don’t call your customers at dinner, please!