• Own a Franchise
  • Alumni Center
  • Careers
Login
Shop
Locations
Sandler
Login
Shop
Locations
  • Solutions
      Professional Development and Growth Programs
      Experiential and transformational sales and leadership training for continuous improvement and lifelong learning
      Office setting
    • Sales Training
    • Sales Leadership
    • Prospecting
    • Expanding Accounts
    • Personal and Professional Growth
    • Customer Success
  • Who We Serve
      Sales Tools and Solutions that Scale
      From Enterprise to SMB sized organizations looking to scale, Sandler is the only training provider with the breadth and depth to help you take the next step
    • EnterpriseBy Type:
    • Scaling Companies
    • Individuals
    • TechnologyBy Industry:
    • Medical Devices & Pharma
    • Manufacturing and Logistics
    • Professional and Financial Services
    • Construction & Building Materials
    • Call Centers
    • Selling to Homeowners
    • All Industries
  • Sandler+
      Technology and Delivery Methods that Accelerate Sales Training
      Flexible learning approaches for tackling your organization's unique challenges and technological ecosystem
      Smiling man shaking hands
    • Sandler Online
    • Technology
    • Delivery Methods
    • Online Sales Courses
    • Assessments & Benchmarking
  • About
      Sales Training and Performance Improvement Leader
      Sandler empowers over 50,000 sales professionals and leaders to master the craft of selling
      Smiling woman shaking hands
    • Company
    • News & Press
    • Awards
    • Summit
    • Franchising
    • Sandler Sales Methodology
    • Sandler Selling System
  • Insights
      Elevate, Evolve, and Excel Your Sales Organization
      Tactics, strategies, articles, tools compiled from over 50 years of experience for sales professionals and leaders
      People near board
    • Sandler Advisor
    • Articles
    • Books
    • Case Studies
    • Events
    • Podcasts
    • Webinars
    • White Papers
    • Sandler Research Center
Let's connect
  • Open a location
  • Alumni Center
  • Careers
  • Privacy Policy
  • Cookie Policy
  • Terms of Use
  • DMCA
Share
Home » Insights » Up-Selling & Cross-Selling
Sandler Research Center

Up-Selling & Cross-Selling

Jonathan Farrington

To increase the revenue and margins of an order by selling products and services at a higher price – up-selling – or by selling additional products and services – cross-selling, we must be able to prove to the customer that there is something in it for them. We must show them increased added – value.

 

Value is the worth of something when compared with something else. For example, value would be a high pay back for small outlay, also discussed in terms of ROI (Return on Investment).

 

Payback is the tangible return delivered by the benefits of your products and services. The greater the payback, the greater the value to your customer – and customers certainly want value.

 

The Value Formula

 

The formula for calculating value is the benefit minus the cost of achieving or acquiring the benefit – i.e., value + benefit – cost. So it is important that we use rigorous questioning techniques to uncover as many needs as possible for which we can offer benefit oriented solutions. We need to be able to explain and sell benefits. The more needs we can uncover, the more benefits we can deliver; the more benefits, the greater the payback; the greater the payback, the higher the value; and the higher the value, the better the chance to up-sell and cross-sell.

 

Proving Value

 

Using the funnel questioning technique will uncover needs, if they are there to be uncovered. However, it is one thing to uncover the need; it is another thing to prove that there is adequate payback and value in fulfilling the needs.

 

Having uncovered the needs, we must probe and find out as much as we can about those needs and the implications to the customer if they are not met or fulfilled. We do this by asking past, present and future questions – i.e., “How did you do this before?” (Past), “How do you do this now?” (Present) and “How do you plan to do it?” (Future).

 

What we are trying to establish is the difference between what the customer used to do, and how it is done now. If we can establish this, then the comparison between what they are presently doing and what they may be able to do, based on our solution, will be easier to grasp. This is important, because the difference between doing something and not doing it is the “value gap.” We need to find value gaps that we can attach a price to, so that we can justify the benefit in terms of added value.

 

Let’s Take an Example

 

In the past, your customer utilized a manual stock and inventory system, but using your database for an automated system has enabled them to increase shipments by 20% per day. With the shipments of goods totaling $10,000 per day, the value gap – i.e., system or no system – is $2000 per day. If the system is down, it would cost $200 to $400 in lost or delayed shipments per hour. Staying as they are or going for a support agreement that would reduce down time, is the value gap opportunity. That gap is worth $200 to $400 per hour.

 

Value Added Arguments

 

You should always be looking for opportunities to offer more features that will be of benefit by asking the customer to tell you areas in which they would like to see greater support or additional services. If you say “Mr. Smith, we would like you to upgrade to our gold support agreement – you will receive earlier notification of software upgrades,” the usual response will be, “We don’t need them.” It’s far better to use reasoning and ask questions to assist the customer into a position where they enquire about additional services and explain the possible outcome if they did not have those additional services. You then present a value-added argument to fill the gap.

 

Summary

 

The best product at the best price does not always win the order. We have all been outsold by a competitive salesperson probably offering less of a solution and sometimes even at a higher price. By selling benefits, and not talking about features, the prospect will understand the payoff that your solution will deliver. Do not leave them to work it out for themselves – they might not bother!

 

If you can instead identify the need for more services and explain, using benefits, how you can meet those needs, it will be a lot easier to up-sell and

cross-sell.

Copyright © 2020 by Jonathan Farrington All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means without permission of the author.

Tags: Account management Research

Related Insights

All Episodes How to Succeed at Using Sandler's Up-Front Contract to Increase Rapport How to Succeed at Using Sandler's Up-Front Contract to Increase Rapport
Podcasts

How to Succeed at Using Sandler’s Up-Front Contract to Increase Rapport

Read Full Article
Sales Leaders: How Well Do You Know Your Buyer’s Journey?
Articles

Sales Leaders: How Well Do You Know Your Buyer’s Journey?

Read Full Article
7 Critical Best Practices for Sales Leaders in 2023
Articles

Prospecting: 8 Critical Takeaways for Sales Leaders in 2023  

Read Full Article

Sales Training and Performance Improvement Organization

Get Social With Us
Stay Inspired
Tactics, strategies, articles, tools and more information about our events and solutions for sales professionals and leaders.
Name(Required)
Privacy(Required)
This field is for validation purposes and should be left unchanged.
Smiling man holding a laptop
  • Alumni Center
  • Careers
  • Shop
  • Locations
  • Privacy Policy
  • Cookie Policy
  • Terms of Use
  • DMCA
  • Your California Privacy Rights
  • Corporate Training
  • Do Not Sell My Information
©2022 Sandler Systems, LLC. All rights reserved. SANDLER (stylized) and E (stylized) are service marks of Sandler Systems, LLC. Sandler is a registered service mark of Sandler Systems, LLC.