Sales Glossary / Glossary Term
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What Is Cross-Selling? Cross-Selling Examples Benefits of Cross-Selling
Cross-Selling Techniques Cross-Selling vs. Upselling
What Is Cross-Selling?
Cross-selling is a sales technique that increases revenue by offering related products or services to prospects and customers. It improves the customer experience by providing a comprehensive solution at the time of purchase.
Why is cross-selling important?
Cross-selling to new customers immediately improves profitability.
This instant boost in average order value drives down customer acquisition costs and makes more efficient use of the business’s marketing budget. Cross-selling has also been shown to lead to repeat purchases, longer customer retention, and higher customer lifetime value.
Cross-selling strategies also diversify revenue streams and reduce the impact of market fluctuations on individual products.
Finally, cross-selling helps businesses sell products or services that may not perform well on their own, providing a comprehensive solution for customers, while clearing out the business’s slow-moving or easily overlooked offerings.
When should a business cross-sell?
Throughout the sales process: The goal of cross-selling throughout the sales process is to build the sale with relevant, complementary offers throughout the buying journey that benefits the customer and the business.
This can be as simple as an ecommerce store suggesting shoes and shirts with jeans, or as complex as an enterprise software salesperson recommending partners and training workshops to tailor the sale to that specific customer’s use case.
The key to cross-selling across the customer journey is to understand the relationships between products, the prospect’s needs, and where and when to promote them.
At the point of sale: Cross-selling at the point of sale promotes related products during the final steps of the transaction.
For example, if a customer is purchasing a CRM, the software provider may promote a lead database at the checkout.
Many strategies can be used to make these late stage cross-sales more effective, such as price anchoring, discounting, or product bundling.
While typically used to provide an instant boost to average order value, cross-selling at the end of the sale also helps businesses identify high-value customers, and provides them with data to promote additional related
Post sale: After a prospect has become a customer, businesses may use the customer’s purchase history to cross-sell additional products through email remarketing and retargeting ads. Using sales data creates a cycle of promoting products related to the previous purchase and is the primary reason cross-selling improves customer retention and lifetime value.
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Benefits of cross-selling
Since cross-selling allows businesses to add relevant products and services to the sale, customers don’t need to work with multiple vendors, or navigate to multiple parts of a website to complete their purchase. Even if a cross-sale doesn’t occur during the transaction, the visibility of related products signals to the buyer the business has solutions to the problems they are trying to solve.
Because of that, there are four primary benefits that come from cross-selling:
- Increased customer lifetime value (LTV). In addition to immediately increasing the average order value, cross-selling has been shown to increase return customer rates and repeat purchases, thereby increasing customer lifetime value and lowering customer acquisition costs.
- Fulfills all purchase requirements. Products often live within an ecosystem with a single product at the center and additional utilitarian and supplemental products on the periphery that make the sale feel complete.
For example, smartphone buyers may require a case, screen-protector, and replacement plan to feel secure in their purchase, while bluetooth headphones, a wireless charging dock, and car mount may be bought to get the most enjoyment from the purchase.
These additional products usually have little purpose outside of the core purchase, however can be perceived as incredibly valuable within the context of that sale. This is why supplemental products such as Bluetooth headphones with a smartphone are positioned as impulse purchases, as they’re more likely to be purchased with another product than on its own.
- Predictably move related inventory. Businesses may cross-sell by bundling related products so customers will purchase multiple items at once.
While convenient for the customer, bundling has wider implications across the entire value chain.
For instance, because bundled items are intertwined, the company can build more predictable sales forecasts and inventory management strategies than products that do not lend themselves to cross-sales.
- Cross-selling provides options for strategic spending on paid advertising. To prevent prospect burnout and overexposure, businesses may cycle through periods of spending on new customer acquisition and getting those customers to repurchase by cross-selling.
For example, a business may run an acquisition campaign for a month, then use retargeting ads and emails the following month to encourage repeat purchases from those newly acquired customers.
It also offers a path to profitability when new customer growth isn't an option. This can be used as a way to sustain through economic downturns, however, businesses must be strategic with their spending and aware of the diminishing returns of only selling to existing customers.
Cross-selling techniques
Product recommendations
Typically, related products are recommended on sales pages, in the checkout, and throughout the online shopping experience.
Paid memberships
Paid memberships often include free shipping, first-looks at new products, and other exclusive perks in exchange for a yearly or monthly fee.
This tactic is widely used across large ecommerce brands because it easily identifies their most loyal customers while having a consistent source of income independent from the sale of physical goods.
Partnership offers
Businesses often collaborate to promote complementary products to each other's customer base. In exchange, the business receives profit as a referral fee.
The result is typically lower cost-per-customer acquisition fees and a higher ROI when compared to other methods of customer acquisition, such as paid, search, or social.
Protection or support services
Cross-selling support services as a strategy typically offers protections for purchases, extended warranties, or more individualized levels of support.
Add-on services can be extremely profitable, especially in cases where more buyers pay into the service than use it.
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Cross-selling vs upselling
While the goal of increasing revenue on the transaction is the same, cross-selling and upselling strategies are often confused.
The most noticeable difference is that cross-selling offers complimentary products or services related to the main offering while upselling sells a similar, more advanced product at a higher rate.
For example:
Swipe
| Cross-Selling Example | Upselling Example | |
| B2B SaaS | Add product training or premium support | Offer a multi-year renewal contract at a discounted rate |
| Insurance | Life insurance added for a customer buying a car policy | Expanded liability insurance for a homeowner who added a pool |
| Electronics Retail | Add a surround sound system for the full theater experience | Suggest an upgraded, higher resolution television model |
| Travel | Suggest sightseeing tours and other services at the destination | Offer a luxury suite at the hotel chain the customer frequents |
| Consulting | Purchase in-person workshop for employees to learn from the consultant. | Offer discounts per unit for buying consultant’s book in bulk. |
Another notable difference between upselling and cross-selling is that upselling typically only happens during the purchase process, whereas cross-selling can happen throughout the entire customer lifecycle.
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How to Create Cross-Selling Opportunities
1. Audit sales data
Businesses should audit their existing sales data to gather information that can guide product recommendations.
Products may be separated into two categories; core and secondary.
Core products are what the sales are built around while secondary products are the add-ons that round out the purchase.
Here are some examples:
Swipe
| Core product | Secondary product |
| Digital camera | Memory card, camera bag, tripod, camera lens |
| Television | Surround sound, Bluray, wall-mount, cables |
| Mattress | Box spring, frame, bedding, headboard |
| Sofa | Throw pillow, blanket, end-tables |
| Suit | Dress shirt, tie, vest, shoes |
If the business is not already recommending products, using their existing sales will remove the guesswork and reveal common buying behaviors to others who are making the same purchases.
2. Find promotion opportunities throughout the customer journey
Businesses may have the data on which products to pair with each other, however the website and marketing materials may not be displaying cross-selling opportunities in the most optimal way.
Here are just a few places where cross-sale offers may be made:
Product pages
Checkout pages
Thank you page
Internal search result pages
Order confirmation emails
Shipping notification emails
App notifications
Retargeting ads
Remarketing emails
Regardless of which surfaces products are being promoted on, the most important factor is the underlying technology is giving the most relevant recommendations possible.
3. Create valuable add-on services
Moving beyond product recommendations, businesses can cross-sell with additional services, such as paid memberships, training programs, protection plans, or extended warranties.
The goal of these add-on services is to create self-sustaining revenue streams that require little to no maintenance post-sale. Because these services are not physical goods themselves, they quickly become pure profit generators whose revenue can be used to safeguard against volatile market conditions.
4. Collaborate with customers to develop new products.
The best source of cross-selling ideas always comes from communicating with the market.
Holding focus groups with existing customers can help businesses identify opportunities for new products, services, and offers, while communicating with non-customers can get an unbiased understanding of the market and where the business fits within it.
This level of intentional communication can help businesses uncover gaps within the market and create truly unique programs that resonate with their intended audience.
How Linkedin Sales Navigator can help
Regardless of industry, effective cross-sales will always be determined by how relevant the offer is to the buyer. LinkedIn Sales Navigator helps connect sales professionals, product leaders, and marketers to their ideal customers so they can start meaningful conversations and improve their offering.
With Linkedin Sales Navigator, teams can:
Tailor outreach by creating prospect lists based on company size, industry, and level of seniority.
Save leads to lists and monitor conversations on the open web.
Set alerts to keep track of industry news and trends.
To see how LinkedIn Sales Navigator can help, request a demo or start a free trial today.
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