If you’ve ever shopped on Amazon and noticed the suggestions for additional, complementary products, congratulations. You’ve been upsold. 

Upselling is a powerful and effective marketing technique through which you target a customer who is already prepared to buy from you and then offer an additional product, service, feature or upgrade. When it’s done right, upselling can dramatically improve your bottom line by increasing the size and profitability of each sale.

Businesses in every industry upsell. Ever been asked if you want to “supersize” your fast food order? Or noticed that for just a small amount more, you can add a few more features to that software you’re purchasing? How about when you’re about to check-out at the local grocery store and you spot your favorite candy bar near the register?

All of these things are examples of upselling, and all of them work. Quite well, in fact.

How to Make Upselling Work for Your Business

Now that you have an idea of what upselling is, the next step is figuring out how you can apply this concept to your own business. The beauty of upselling is that it’s not industry specific, so regardless of what product or service you happen to sell, there are certain universal strategies that apply. Here are a few such strategies to keep in mind.

Know your customers.

In-depth knowledge of your clientele is critical to the success of any upselling initiative. To get people to bite, you need to really understand their wants, needs, preferences and pain points. Think about a waiter at a local high-end restaurant. He might take note of the wine preferences of his regular customers so that next time they come in, he can suggest they try a bottle of a new (more expensive) brand. Not only does this boost profits, but it also creates a more personalized experience for the customer.

Be strategic.

You may think that the more upsells you offer to your customers, the better the outcome, but that’s not necessarily the case. In fact, too many offers can actually end up confusing and even possibly driving away your customers. When you’re developing upsell ideas, focus on providing a solution without creating more questions. For instance, when providing cross-sell recommendations, don’t offer 23 different options. Stick with a few, well-targeted ones. This will increase the likelihood of a successful sale.

Stick to the “Rule of 25.”

Research indicates that in order for upselling to be successful, the additional products/services/features should never be more than 25% of the original order. In other words, if you’re selling cars and a customer comes in to purchase a Hyundai, trying to upsell to a Lamborghini probably wouldn’t be very effective. Instead, you should only try to sell a vehicle that costs less than 25% more than the Hyundai. Likewise, if you are cross-selling, you shouldn’t try to sell anything that costs more than 25% of the original order amount.According to Marketing Metrics, the probability of selling to a new prospect is 5 to 20%. The probability of selling to an existing customer, on the other hand, rises to 60 to 70%. Upselling, when done properly, can help strengthen relationships with your customers while boosting profits at the same time. It’s a win-win.