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Understanding Post-purchase Upsells

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Ecommerce

Understanding Post-purchase Upsells

What is a post-purchase upsell?

What if there was a way to get an immediate 15-30% increase to your revenue? You would be crazy not to jump on that opportunity, right? Well if you’re not using post-purchase upsells as part of your sales funnel then that’s exactly what you shouldn’t be doing.

At it’s core, upselling is a strategy used by ecommerce marketers to increase a customer’s average order value (AOV). It’s all about understanding your customers and using that information to persuade shoppers to buy more than they were originally planning.

The key difference with post-purchase upsells when compared to other marketing strategies is that you’re exposing customers to the campaign (either by making them aware of products that are complementary to ones they’ve just purchased or increasing their motivation to spend more with special offers or discounts) only AFTER a transaction has been completed.

That’s the genius part of post-purchase upselling, the offer doesn’t appear until after the sale has been completed. This eliminates the risk of distracting the buyer with other offers as there’s a 0% chance of scaring them off.

Why should you include one?

Post-purchase upselling is one of those rare additions you can make to your sale funnel that poses zero risk to your current performance.  Key benefits include:

You don’t have to worry about distracting your customers

As mentioned earlier, a major benefit of post-purchase upsells is that it doesn’t interfere with your normal customers purchasing habits. While pre-purchase incentives can distract or annoy the customer, post-purchase upsell appear after customers have already made a purchase. Even if they ignore your offer you’ve still completed the sale.

It helps customers and grows your revenue

Using post-purchase upsells can help increase your revenue by as much as 15-30%. This is because when done well, post-purchase upsells provide genuine value for consumers. Whether it’s exposing them to other products they might like or giving them an opportunity to purchase more at a discount, post-purchase upsells are almost always seen as a positive from consumers.

You can build and foster a relationship with your customers

When setting your post-purchase upsell strategy, increasing your revenue should not be your main concern. Instead think of it as a way to make your customers feel special, every post-purchase upsell is an opportunity to build a better relationship with your customer. A great way to do this is to make the upsells feel personal and thoughtful rather than a cash grab. If done right your customers will be thankful when they see the upsell call to action.

How to get started with post-purchase upsells?

Some of the most successful examples of post-purchase upsells exist in the offline world. Think about when you go to a fast food restaurant and they ask if you’d like fries with your order. They ask after you’ve committed to an order and they know you won’t walk away from your burger. Asking the question “do you want fries with that?” is zero risk, and if you do order fries your AOV shoots up.

In the online world, things are a little bit different, but the same strategy works just as well. Take Etsy for example, they have one the best upselling-techniques out there.

When a customer makes a purchase through their website, Etsy, like most shops, sends a purchase receipt via email. In that receipt, they include all the usual information a customer would expect such as what was purchased, shipping information and the cost. Where the upsell comes into play is under their “you might also be interested in” section. Here they combine items that go well with what you’ve purchased with items you looked at while browsing their site to create a personalized feed of products.

This works for a few reasons:

  • The items are familiar and relevant – They use items that go with the current purchase or that the customer has already looked at.
  • It adds value to the customer – They know the customer is interested in these items and this upsell might act as a friendly reminder for them to buy them.
  • Not too sales-y – They include this information at the bottom of their invoice email, meaning people who want to ignore it can do it easily.

Conclusions

Today’s consumers are smarter than they’ve ever been, and they know when you’re trying to sell them something. So, if you’re going to utilize an upsell strategy, then it’s critical that you think about it from a customer’s point of view. Remember, you can’t scare away a customer with a post-purchase upsell, as they’ve already made their purchase, but you should still do everything possible to increase the chance of them making a second purchase.

Sources

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Dalia El Gammal

Sr.Marketing Specialist PAYFORT

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