Cross sell and up sell techniques in e-commerce

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This presentations shows several kinds of up sell and cross sell techniques used by e-retailers and also has a brief analysis of them.

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Cross sell and up sell techniques in e-commerce

  1. 1. Cross Selling / Up Selling experience in e-commerce July 2007 – Daniel Tartaro (daniel.tartaro@gmail.com)
  2. 2. Index 1- Definitions 2 - About Cross Selling and Up Selling (CS / US) – Who, What, When/Where and How? 2.1 – Who 2.2 - What 2.3 – When/Where 2.4 - How 3 - Key Success Factors
  3. 3. Cross Selling Up Selling Cross-selling is the strategy of selling other products to a customer who has already purchased (or signaled their intention to purchase) a product from the vendor. Up-selling is a sales technique where a salesman attempts to have the consumer purchase more expensive items, upgrades, or other add-ons in an attempt to make a more profitable sale. <ul><li>Air Ticket + Car Rentals </li></ul><ul><li>Camera + case </li></ul><ul><li>Jacket + shirt </li></ul><ul><li>Air Ticket + class upgrade </li></ul><ul><li>Notebook + memory upgrade </li></ul><ul><li>Simple car > fancy car </li></ul>Term Definition* Examples *Source Wikipedia Back to Index Definitions
  4. 4. EXAMPLE – Amazon.com > Product Detail
  5. 5. EXAMPLE – Amazon.com > Product Detail Product details Cross Selling Up Selling (expensive models)
  6. 6. Cross Selling Back to Index Up Selling Who? <ul><li>Identify the customer or a cluster for a better approach. </li></ul><ul><li>Present relevant offers based on his buying history and/or social-demographics characteristics. </li></ul>When, Where? <ul><li>Identify the best moment during the buying flow to offer another product or service. </li></ul><ul><li>Respect the users main objective. </li></ul>How? <ul><li>Identify the best position on the screen </li></ul><ul><li>Identify the best model (text based, txt+img, advertising, radiobuttons, checkboxes, etc) </li></ul>>> Based on Logics : “I’m buying new shoes, I’ll probably need a new belt!” >> Based on other customer’s behavior : “Customers who bought the Mariah Carey DVD, also bought Christina Aguilera DVD” What? <ul><li>Identify the products or services which best fit the buying situation. </li></ul><ul><li>Constantly analyze buying behavior in order to identify new trends (predictive models) </li></ul>
  7. 7. Back to Index The challenge of the one-to-one marketing Who? 010101010101010101010101 Users Website Data Intelligence Customization *Source: B2B Marketing trends, available at http://www.b2bmarketingtrends.com/abstract.asp?id=198&groupid=10 RESPECT SECURITY and PRIVACY policies!! WHO > What > When > How <ul><li>Search </li></ul><ul><li>Click </li></ul><ul><li>Navigate </li></ul><ul><li>Buy </li></ul><ul><li>Store actions, individually and collectively </li></ul><ul><li>Convert raw data into Business Intelligence </li></ul><ul><li>Provide RELEVANT offers </li></ul>Customization <ul><li>Drives online conversion rates </li></ul><ul><li>Delivers higher profits per transaction </li></ul><ul><li>Increases customer satisfaction and loyalty </li></ul>Why??* one-to-one relationship
  8. 8. EXAMPLE – Amazon.com > Home Page Back to Index WHO > What > When > How
  9. 9. EXAMPLE – Amazon.com > Home Page Customized home page based on buying and behavioral history Back to Index WHO > What > When > How
  10. 10. EXAMPLE – Amazon.com > email mkt WHO > What > When > How
  11. 11. EXAMPLE – Amazon.com > email mkt Customized email marketing based on buying history WHO > What > When > How
  12. 12. Finding the best offers to increase share of wallet What? Back to Index Type of products groupings / services*: *Source: ClickZ – Avalable at: http://www.clickz.com/showPage.html?page=3610171 Who > WHAT > When > How Competing <ul><li>Products the user could buy instead of the current product </li></ul><ul><li>E.g. Sony DVD player vs. Pioneer </li></ul>Complementary <ul><li>Products which are intended to be sold with the current product </li></ul><ul><li>E.g. DVD Player + Speaker/Receiver system </li></ul>Family <ul><li>Usually from the same manufacturer and part of the same product line </li></ul><ul><li>E.g. Furniture set (chairs, couch, table) </li></ul>Accessory <ul><li>Can’t be used on their own, they are accessories to the main product, bold sold separately. </li></ul><ul><li>E.g. Watch batteries, warrantee </li></ul><ul><li>It’s not a good idea to lump all the groupings under the same “related products” umbrella. </li></ul><ul><li>Complex products customization must be carefully analyzed, sometimes it can compromise the purchase progress. </li></ul><ul><li>Offering competing products can sometimes create an undesirable “looping navigation”, compromising the conversion rate. </li></ul><ul><li>It is important to give more weight to family products than complementary because they’re meant to go with the current product. </li></ul>Observations
  13. 13. EXAMPLE – JCPenney > Product Detail Who > WHAT > When > How
  14. 14. EXAMPLE – JCPenney > Product Detail Family product offering, enhancing the shopping experience. Who > WHAT > When > How
  15. 15. Suggestions for a better CS/US approach <ul><li>Car rental </li></ul><ul><li>Hotel reservation </li></ul><ul><li>Tickets </li></ul><ul><li>Shuttle Service </li></ul><ul><li>Vacation packets </li></ul><ul><li>Cruises </li></ul><ul><li>Car rental - $$ </li></ul><ul><li>Hotel reservation - $$$ </li></ul><ul><li>Tickets - $$ </li></ul><ul><li>Shuttle Service - $ </li></ul><ul><li>A/B Test the best step </li></ul><ul><li>A/B Test the best position </li></ul><ul><li>A/B Test the best format </li></ul><ul><ul><li>Text + Image </li></ul></ul><ul><ul><li>Text only </li></ul></ul><ul><ul><li>Advertising </li></ul></ul>When/Where? Back to Index Put the right product, in the right place in the right moment. Maximize “share of wallet”, combining different products and different profit margins. It’s imperative to have an integrated and smooth shopping experience!! Who > What > WHEN > How 1 st Determine the Categories 2 nd Determine the Most valuable Categories 3 rd Test all the variables
  16. 16. Back to Index EXAMPLE – L L Bean > Product Detail Who > What > WHEN > How
  17. 17. Back to Index EXAMPLE – L L Bean > Product Detail Who > What > WHEN > How
  18. 18. Related products based on a narrow price range (3 options) EXAMPLE – L L Bean > Product Detail Back to Index Up Sell Who > What > WHEN > How
  19. 19. What specialists say about user behavior and approach models?* How? *Source: NNG – Selling Strategies (2000) | FORRESTER - Flash Shopping Cart Boosts Conversion Rates (2005) – AVAILABLE AT //MOTHERHUGEResearch Reports ** Based on a specific case – tjmaxx.com Back to Index Who > What > When > HOW Fo rre ster <ul><li>Interesting Flash “single screen” checkout process case </li></ul><ul><li>50% more conversions than multi step html** </li></ul><ul><li>Single step encourages users to explore the effects of adding items to cart </li></ul><ul><li>Quickly calculate the effects of CS/US </li></ul><ul><li>Single step gives power to prospects </li></ul><ul><ul><li>More control , engaging user in the process </li></ul></ul><ul><li>Single step builds trust </li></ul><ul><ul><li>Speed responses rates increases the security perception </li></ul></ul>Make the CS experience as smooth as possible. Less steps, more conversion! NNg <ul><li>Suggest additional items, but don’t put obstacles before the cash register </li></ul><ul><li>Usage of non intrusive offers are recommended </li></ul><ul><li>Acceptable approach: additional items on the product page </li></ul><ul><li>Bad approach: during the checkout process </li></ul><ul><li>Don’t create an extra step into the checkout step </li></ul><ul><li>Usage of add-ons checkboxes or radiobuttons are recommended </li></ul>Key points
  20. 20. Back to Index EXAMPLE – Staples.com > Product Detail Who > What > When > HOW
  21. 21. Up Sell Back to Index EXAMPLE – L L Bean > Product Detail Who > What > When > HOW
  22. 22. Back to Index EXAMPLE – L L Bean > Product Detail Who > What > When > HOW
  23. 23. Good integration between the product and the cross selling offers. Back to Index EXAMPLE – L L Bean > Product Detail Who > What > When > HOW
  24. 24. Key Success Factors for a high conversion rate for Cross Selling experience Create a integrated, smart, easy to use and worthwhile shopping experience Key Factors Details Back to Index Integration Smoothly integrate others products and services on the buying flow, in order to create a consistent shopping experience Intelligence Identify the best offer in the situation (e.g. hotels in the destination city) Exclusive offers Offer good deals to the customers, it will enhance the shopping experience and will create loyalty among the most valuable customers

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