Choosing a sales strategy is a balance of adding risk for potential rewards. Often this area is where a company will choose to take risks to make extra profits. However, the risk isn’t always worth it. What if you want to select sales tactics that you know will work?
There are nearly infinite sales strategies you can use. But some choices are riskier than others. So what does a company do when they need a reliable plan? Well, many companies rely on similar sales tactics when they don’t want the added risk. Today we’re going to talk about four of these reliable sales tactics.
Up-selling is the process of making already profitable transactions more profitable. This can include stuff like upgrades and add-ons. This process boils down to leaving no stone unturned. This process improves value for both consumers and businesses. Often a customer will purchase an improved product, which in turn benefits the seller as well. So what does up-selling look life in the real world?
One example of the Up-sell is fast food upgrades. Fast-food chains will offer customer upgrades to more substantial sizes at a reduced cost. The upgrade means extra profits for a small price. Fast food has seen massive success from utilizing upsetting strategies! Similar to up-selling, cross-selling also capitalizes on existing sales.
Cross-selling is the process of collecting a database of past customers to market products and services too. Cross-selling can also happen immediately. If a customer makes a purchase and you offer a complimentary one, they might get that too. This process relies on the idea that some goods or services are complimentary. And customers are likely to buy these goods together when presented with the chance.
But how does cross-selling work on the ground? For a cross-selling example, we can look at online retailers. Its common practice in e-commerce to forward catalogs to past customers. The data shows these customers often return to buy other products. Even the corporate giants do this in the form of recommended goods or services mid purchase. Like up-selling cross-selling relies on predicting and adapting to customer needs.
Third-party charges are additional payments to a separate party outside of the initial buyer and seller relationship. These charges are often found where a service provider is teaming up with other companies to improve services. Third-party charges can help facilitate previously complicated relationships. This is usually done where some part of the transaction is useful to the third party. One example of this is video streaming.
Often video streaming websites will offer their service for free. Initially, this might seem like a bad idea for profits. But when the third party advertisers step in, the business model is quite profitable. This model involves a third party to facilitate a better service at a lower cost. Including the third party saves both the consumer and the provider money. And they are often providing utility to the third party.
Bundle offerings are sales that package goods together to create a more attractive offer. Because the purchase is more significant, the customers see a higher value to purchasing power. When customers feel this increased value, they are incentivized to buy. The bundled products should be complementary goods for this sales tactic to work. Complimentary goods make bundles worth the increased initial price. Some products are only sold in packages. A product that is bundle exclusive is oftentimes only purchased in tandem anyway. Because the product is only sold with its likely counterparts, the company actually saves money. So what are some examples of bundled products?
One classic example of a bundled product is often seen in car sales. Often, additional purchases of A.C. systems and window tint will be sold in a bundle with the car. These products would cost more aftermarket unless purchased from a dealership. This difference means that for most customers, a vehicle with additional bundled goods seems more valuable. To return to the fast-food metaphor, another bundle is kid’s meals. Certain complimentary kid foods are served together in a cost-effective package.
Some sales tactics come with more risks than others. But what do you do when you don’t want to add risk? Utilizing a trusted sales tactic can help remove some risk from your business plan. Up-selling is an excellent strategy to make the most out of your product line. If you can modify a product for little cost, up-selling is effective.
Similarly, if you offer multiple complementary goods, you can utilize cross-selling or bundle offerings to promote higher value sales. But what if your value is linked to your customers? Your company can team with a third party to offer a cheaper service.
If you need help deciding which sales strategy is best for your company, Kallen media can help. To get help with sales tactics and even more contact, Kallen media on our website.