Business January 29, 2019 Last updated January 23rd, 2019 2,492 Reads share


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Cross-selling is not an exact science, but it is getting better. The biggest questions companies have about their cross-selling campaign is what return on investment (ROI) they are getting for the money and time they spend

In order to get the best return on your marketing, stop for a moment to consider how cross-selling products you are promoting can grow your business. Encouraging your customer to buy more of the product, or an ancillary product, will increase the size of the transaction; you’ll get more profit from the same effort. Return on investment, ROI is a ratio of your company’s net profit compared to your company’s net profit compared to your financial investment in the business. ROI isn’t the same as profit from the sale of goods or services. It is the financial return you receive from spending money. A performance measure used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments. ROI measures the amount of return on an investment relative to the investment cost.  To calculate ROI, the benefit (or return) of an investment is divided by the cost of the investment, and the result is expressed as a percentage or a ratio.

The return on investment formula:

                       ROI = Gain from investment – Cost of investment

                                              Cost of investment

It’s typically expressed as a percentage, so multiply your results by 100

How it works (Example):

The ROI calculation is flexible and can be manipulated for different uses. A company may use the calculation to compare the ROI on different potential investments, while an investor could use it to calculate a return on a stock.

Many marketers and growth hackers often focus on optimizing top of the funnel. They test every variable imaginable, always chasing higher homepage conversion rates. Yet many of them (especially the growth people) miss out on optimizing further down the funnel.

Getting people to purchase is tough, and it deserves the attention it gets. But further down the funnel, during the purchase process (or after), there can be lots of tweaks to make. These visitors have shown intent to purchase, now take advantage of it and do some cross-selling. Even in the case of post-purchase, companies that don’t up-sell or cross-sell may be leaving revenue on the table.


While most companies invest a lot of marketing and sales enablement dollar into increasing lead flow or close rates. Driving cross-sell rates is often overlooked which is a huge miss because increasing the dollar amount of your deals is actually one of the easiest ways to grow revenue.

Did you know that up to 60% of the customers who have committed to a sale will make another last minute purchase when offered?

“When offered” is a key part of these statistics: you can’t expect your customer to know the benefit from the additional item if you did not inform them. That’s why systematic cross-selling should be a part of your sales playbook. The reason why this service is so valuable is that it maximizes the potential of each and every customer.

Often, people use the term “upselling” when what they really mean is “cross-selling.”

A quick explanation of the differences:

Upselling is the practice of encouraging customers to purchase a comparable higher-end product than the one in question,

What is Cross-selling?



In cross-selling, a sales rep may want to pitch another product that compliments the current offering at hand, so recommending another product an additional product is needed. Besides from the obvious benefits of a larger sale – profit generation or greater product or service cross-selling have its unique benefit.

Cross-selling provides additional quality to the original order too. A classic example is that Big Mac might taste even better with a side of fries to go along with it. If your reps can pair a high-margin product, such as a cell phone, with a low-margin offering, such as a phone case or charger, they easily increase the overall profit margin of the deal.

How to cross-sell effectively.

  •  Know your customer:

    The key to cultivating long-term, profitable business relationships, says Miller, is making it easy for your customers to work with you.

    Be flexible in what you offer and in how you conduct business. Avoid the “one size fits all” approach and tailor each business relationship to the client’s needs. “Flexibility is a must if you have competition,” Miller says. “When you are rigid with what you offer, you are giving your competition an edge.”

    It’s important for your reps to be equipped in order to create the optimum cross-sell product or service package. Inform your reps on which products are more likely to be sold together so there are no questions about it. You can even take the next step and, if there are some cross-sell combinations that customers always buy, formalize the cross-sell by making a bundle for your reps to sell. Or, offer a discount for buying products together to encourage customers to buy more.

  •  Harness the Power of Listening:

    Listening to your customers enables you to make adjustments to your pitch, product or service as the relationship evolves.

    “Don’t listen so you can sell a product or solution. Listen to see if you can be the solution for them — not just your product/service, but you as well,” says Karen Pryor of P2E Marketing. “The majority of the time, it’s the established connection that the customer is buying. After all, there are a lot of people doing what we’re doing, just under another logo.”






  • Watch the price:

    Like up selling, the price is a factor with cross-selling. Cross-selling tends to be more successful when suggested products or services are half-price or lower than the item being purchased.


    “Getting your customers to increase their spending with your company doesn’t have to be about chasing the dollar; it should be about providing the best solution for their needs


Cross-selling is a core component of a customer-centric relationship strategy and requires an integrated view of the customer. The success of a cross-sell program depends on enablers such as organizational commitment; well-defined business strategy, effective execution, regular monitoring, and effective targeting strategy. The well executed cross-selling technique can lead to a boost in revenues by selling more to the same customer, however, it’s not all one-sided and the benefit extends to the customer’s experience as well. By effectively cross-selling you can make sure that the customer chooses the right product for them and that they have everything they need to use the product.

As an example: batteries are a preferred cross-sell item for products that don’t come with their own batteries. Not only would this increase the total count value but it also prevents the customer from receiving an item they can’t use immediately.

 Cross – Sell Process

The grid below outline’s the cross-sell process.


Significantly ROI improvement (double, even triple digits) can be achieved through product cross-sell, which is utilized by 7% of the corporate sector.

Besides from the obvious benefit of a large sale which in turn produces a positive return in investment.

3 Ways in which cross-selling increases revenue (Hence positive ROI)

  • Significantly Increases your customer Live Time Value (LTV)This can be defined as the dollar value of a customer relationship, based on the present value of the projected future cash flow from the customer relationship. Customer lifetime value is an important concept in that it encourages firms to shift their focus from quarterly Profits to the long-term health of their customer relationships. Customer lifetime value is an important number because it represents an upper limit on spending to acquire new customers. The difference between me walking out of McDonald’s with a cheeseburger and me walking out with a cheeseburger combo and an apple pie is sadly not self-control. Rather, my purchase decision rests upon the words, ‘Would you like a combo with that?’ McDonald’s has it all figured out. When you increase the average dollars of each sale, you make more over the customer’s lifetime. One critical thing to remember when cross-selling is to always provide honest, targeted information. Unrelated recommendations damage the credibility of relevant ones, so resist the urge to cross-sell a bunch of products at the same time. Relay the benefits tailored to the customer, and don’t over-promise what your service or product can deliver. The concept of cross-selling to increase the revenues is not a new one, it’s just most businesses don’t do it well. Cross-sell with honest, targeted delivery and you’ll find your average sale increasing without having to bump up any expenses. The reason why these services are so valuable is that it maximizes the potential of each and every customer. In fact, cross-selling can result in an average of 40% additional gross sale per customer touch point, hence a positive ROI.
  • Increase your Average Order Value (AOV) per Customer:

Average Order Value (AOV) is the measure of how much money your customers spend each time they place an order through your online store. This is an excellent method to increase ROI. In basic term cross-selling aims to increase AOV by persuading your prospects to purchase extra products. It features heavily on sites like Amazon where for every product you view, you’re presented with a few supplementary add on products.
The effectiveness of cross-selling varies, but if we assume this campaign hits a 35% success rate which is a significant increase in AOV and in turn positive ROI

Collect more leads


Cross-selling provides the best way to generate sales leads and finding new customers. “There is nothing better than getting a sales lead from a happy customer,” says JR Rodrigues. However, cross-promotion by forming “alliances

with complementary, noncompetitive vendors to exchange leads, promote each other’s products and services, or any number of other mutually beneficial activities,”

Leads generated from such activities can be quite good — sometimes almost the same quality as customer referrals,” says Rodrigues. “The downside is that managing such alliances can be time-consuming and the lead flow.


Although your motives are always going to be increased sales and average order size, it’s important to also consider the experience from a customer perspective. Although your motives are always going to be increased sales and average order size, it’s important to also consider the experience from a customer perspective. That said, cross-sells is a smart way to optimize your business and raise the value of every conversion. Ultimately, it boils down to this: The customer is king. Listen to them and give them what they want. That generally leads to more sales and happier customers too.  Offering customers seemingly random products won’t cut it and can just leave customers more confused. Carefully look at the array of products you offer and consider what makes the most sense to offer the customer and at which point and you’ll be well on your way to increase your revenues by selling more to the same customers while providing a better experience.

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Michael Usiagwu

Michael Usiagwu

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