Wednesday, November 18, 2015

Upselling and Cross-Selling Software

In the United States, the day after Thanksgiving is the start of the Christmas gift-buying season. A few years ago, I was standing outside the local computer superstore at 6:00am, when they opened for their huge pre-Christmas sale. Although there were a dozen customers waiting to get into the store that Friday morning, there were plenty of sales people ready to help customers. I was greeted with a smile, and asked what I'd like to purchase.

I named the item from the morning newspaper ad, and a minute or two later, the clerk brought it from the back room.

He asked, "Is there anything else that you're interested in today?" and I thought for a second and said, "No thanks; that'll do it."

A minute later, I was sitting in my car with my sales receipt and my purchase.

I asked myself, how would I have responded if instead of asking, "Is there anything else that you're interested in today?" he had said, "We have nearly fifty high-tech gadgets for sale for under $30 each, and they'd make terrific holiday presents. Would you like me to show you one or two of my favorites?"

Or if he had asked, "Have you completed your holiday shopping, or would you like me to show you a couple of our affordable best-sellers?"

I think the store made quite a few sales that Friday morning. But they could have made a lot more if their sales staff had been properly trained.

Software developers have lots of opportunities to sell additional software at the time of purchase. Credit card in hand, your buyers are thinking about having fun on their computer, or solving business problems with their tablet, or whatever problem your applications solve. You're in a position to sell them other applications that you offer. In addition, offer your customers the software that you sell on an affiliate basis - other software that your fellow microISVs are marketing.

Anybody who has purchased books on Amazon has experienced the ultimate in being asked to buy additional books. From the moment you put your virtual hands on a book that you want to learn more about, Amazon suggests a two-book bundle. They display the names of other books that earlier buyers have purchased. Amazon names additional book titles in the same category, and suggests that you buy them too. And they remind you that your book qualifies for shipping discounts if you buy additional books at the same time.

When you close the sale on Amazon's website, they offer you a discount if you buy and ship additional gift copies of your books. The amazing part is that Amazon does all of this cross-selling without making buyers feel like they're being pressured.

I believe microISVs should do something similar on their websites -

  • Encourage people to upgrade from a single-user license to a family license, entitling them to use your software on all of their home computers.
  • Suggest that they buy an additional copy, to give to a friend or colleague as a gift.
  • Offer gift certificates. 
  • Offer to ship a physical CDROM or DVD, with or without a gift card and gift wrapping.
  • Encourage the sale of your multi-user and site licenses.
  • Offer bundles of your applications, or combinations of programs from your company and others. There are many ways to create product line extensions, brand extensions, suites, and software product families.

Don't jeopardize your original sale by confusing or offending your prospects with your attempt to upsell them. Make sure your customers know exactly what they're buying.

But take every opportunity to increase your average order size by cross-selling and upselling to your customers.

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