Upsells are everything. Getting the initial sale is amazing, but upselling is beyond amazing. It’s worth writing home about– every time.
Why upsell? Upselling is the best way to increase the lifetime value of your customers. Plus, it’s much more cost-effective to sell to your current customers than it is to woo new ones.
But, as an SaaS, how do you persuade your current customers to make the more expensive purchase?
It’s not as difficult as you may think. When customers have their credit cards out, they’re ready to make a deal– all you’ve got to do is make an offer that’s worth their while.
Let’s discuss the fine art of upselling for SaaS.
Upselling Vs. Cross-Selling
You’ve heard of upselling. You’ve heard of cross-selling. But you’re not sure which is which. Here’s the main difference:
Upselling is about getting customers to buy the more expensive product.
Cross-selling is suggesting that customers buy a related or additional product.
You may think that it’s easier to cross sell, but research shows us that the opposite is true. People gravitate to an all-in-one solution, which is what you’re likely to offer in your upsell.
How to Make an Enticing Upsell Offer
Now, let’s turn our attention to creating a compelling upsell offer.
Get Over That Scammy Feeling
First things first, get over the idea that “upselling” is code for scamming your customers into paying you more money. It’s not.
By offering levels to your service, you’re making it more accessible and affordable to a wider group of customers. However, when you offer to upgrade to an entry level service, you’re not trying to bilk your customers— you’re trying to help them.
If you believe the customer can benefit from your premium product, it would be a disservice not to market it to them. By doing so, you’re simply helping the customer win.
Unfortunately, a lot of SaaS businesses avoid upselling for fear of annoying their customer. Here’s the thing: you’re not going to annoy your customer by offering them a better solution to solve their problem— you’ll annoy them by not doing so.
Remember, your reason to upsell is so that the customer may have the best experience with your product and finally solve their problem. Who’s going to be annoyed at that type of offer?
Focus on Your Existing Customers
I mentioned earlier that you should upsell to your current customers. Your current customers are 50% more likely to upgrade than a new customer who hasn’t tried you out yet.
Perhaps it goes back to trust. You’ve invested a lot of time and effort after the initial sale in nurturing your current customers. Through thoughtful onboarding and automated email, you’ve helped your customer see the value of your product.
All of that nurturing is worth it because you’re building a solid foundation of trust with your customer. When the time comes to offer the upsell, they’ll likely take you up on that offer because you’ve already demonstrated so much value.
Of course, you should try to upsell to everyone— but I highly recommend upselling to customers who’ve already purchased your entry level product. Current customers are the most primed. We’ll discuss more about when to spring the upsell a little later on in this post.
Understand What Your Customer Needs
Understanding your customer’s needs is crucial to successfully upselling them. You can’t just recommend any product. You’ve got to recommend the product that fits.
To do this, analyze the customer’s stated needs and goals. What does your customer want to accomplish with your product?
The best way to figure this out is to ask.
After the customer has purchased your product, send a one-question survey in your welcome email that asks, “How will you use this product?”
Then, let their answer guide you into making a personalized upsell offer.
For existing customers who’ve been with you for a while, look at how they’ve used your product so far. You can also send out a similar survey question in-app or via email.
I recommend providing answers in a multiple choice style so that you can easily (and automatically) segment the customers. This is especially useful if you have more than one type of upgrade available.
Focus on the Benefits
When you sell, you should never list features. Features don’t sell a product. Benefits do. It’s like the old adage says, “Don’t sell the mattress— sell the good night’s sleep.”
In your upsell marketing copy, focus entirely on the benefit that the customer will gain from upgrading. Answer the question:
How will this upsell improve my customer’s life? Yes, life.
For example, Spotify has changed my life because I no longer have to purchase individual songs— one monthly subscription, and I’ve got access to every song I’ve ever cared about.
Or Amazon Prime has changed my life because I don’t have to worry about shipping costs— everything is built in and my order is going to be at my doorstep in two days.
What life-changing benefit does your upgrade offer?
In your copy, be sure to include testimonials and case studies of other customers who are loving your product. Select ones that are specific and benefit-driven, not ego-boosting (i.e. “ABC app has helped me do XYZ” vs “I just love the product”).
Offer a Trial
Yup, even your upsell can have a trial. I recommend offering a trial for your upgrade if it will require a substantial leap (cost-wise). Sometimes, trying is believing, especially for customers who are on the fence. If you’ve offered an upsell before, and they didn’t bite, consider offering the upsell with a trial the second time.
When to Offer the Upsell
So, let’s discuss timing. When should you offer the upsell?
There are three particularly effective times to offer the upsell:
- During the checkout process –
This is pretty obvious. Always steer the customer towards the higher priced item during checkout, if you can. As you guide the customer through the checkout process, you can offer an upgrade. Be sure to lead with the benefits as you explain why the higher priced item is a better deal.
If the customer doesn’t upgrade in this step, add them to an upsell segment on your email list.
- During your ongoing email marketing campaign –
This may not be as obvious as the first. A lot of SaaS forget to use email marketing to woo their current customers. Don’t be scared. If they bought from you once, they’re likely to buy from you again, especially after using and benefiting from your product.
Get to upselling as soon as possible though. You don’t want to wait weeks, or possibly months after the initial purchase to spring an upsell. I recommend upselling within the first three days after the initial purchase.
- Within the app when the customer reaches a critical point –
While the customer is in your app, encourage them to upgrade. Do that by showing what they’re missing. In other words, keep all of the upgraded features there, but gray them out so that when a curious customer clicks, they’re met with an offer to upgrade. This option allows you to show your customer the value that the upgrade offers.
Additional Resources
Before you go, be sure to check out these related posts:
- Use These Email Marketing Tips to Convert Trial Users to Customers
- Customer Education 101: How to Understand Them and Make Them Understand You