The advantages of cross selling to regular customers far outweigh any potential drawbacks.

Anyone who’s visited Amazon.com has probably seen a section of recommendations at the bottom of the screen. Based on your interest in a current item, Amazon suggests other items you might want to buy. Back in 2006, the online giant estimated a 35% revenue increase from those recommendations, a number that has probably only gone up today. By including the recommendations, Amazon demonstrated how well they understood the advantages of cross selling to their existing customer base.

Of course, Amazon has a bit of an edge. Their recommendations are essentially the online equivalent of the candy bar aisle at the grocery store. The add-on items usually aren’t terribly expensive and are more likely to be impulse buys. However, that doesn’t invalidate the advantages of cross selling bigger ticket items or cross selling to businesses. No matter what you’re selling, cross sales is an excellent way to increase your revenue without going through the effort of finding new leads and building new relationships.

advantages of cross selling

What is cross selling?

Cross selling simply refers to selling an existing customer a product or service in addition to what they initially wanted. So if a business owner is looking for group health insurance and you also sell her group life insurance, you’ve cross sold.

Cross selling looks different across business sectors, but one thing all cross sales should have in common is that they enhance value for the customer. The biggest risk with cross selling is that an existing customer won’t find added value to the additional purchase, which can fracture a business relationship.

However, when practiced correctly, the advantages of cross selling all but cancel out the risks involved.

advantages of cross selling

How to cross sell effectively

There are a few ways to successfully cross sell, depending largely on your industry as well as your authority to adjust prices. The most important thing to keep in mind is that the product or service you’re cross selling has to add intrinsic—not just monetary—value. A customer won’t care if they’re getting a 30% discount on something if they don’t have any use for it. They have to see how the product will benefit them before the price becomes attractive.

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Another way to improve cross sales is to offer a discount or bundled package. This adds financial value to the intrinsic value you’ve already established. If you don’t have the authority to do this yourself, get permission from someone who does before you engage the customer. That way, you know what your negotiation limits are, and you won’t sound uninformed.

Remember that cross selling is still selling, which means you need to help a customer solve a problem or fulfill a desire. Always look for opportunities to cross sell, but don’t force them. Most of them will come up naturally. If you listen to your customers and have true expertise in your offerings, you should have no trouble honing in on the cross sell.

advantages of cross selling

5 Cross selling benefits everyone in sales should know

Now that we have some of the background out of the way, let’s talk about the advantages of cross selling to existing customers.

1. Cross selling builds customer loyalty

Cross selling opportunities should help a customer solve a problem. That builds loyalty. Going back to our insurance example, if you sell someone group health insurance at a competitive rate and then cross sell them on life insurance, it tells them that you have access to products that can solve multiple problems for them. And why go elsewhere if all the solutions are in one place?

2. Improves profitability, lowers price

Most cross sales involve some kind of discount, which means your firm will make less on the product than if sold alone. However, you may not have gotten the sale at all without cross selling. So instead of missing a sale, you simply make less on it, but still increase overall profitability.

At the same time, the customer wins because they are likely paying less for a product. The company profit/customer discount is probably one of the most significant and noticeable advantages of cross selling.

3. Sets you apart

The beauty of cross selling is that there are so many ways to do it. Whatever technique you come up with becomes your personal selling advantage that separates you from competitors. If your approach is reasonable and valuable, you’ll add to that customer loyalty that’s so important.

4. Strengthens customer relationship

As long as you don’t try to pitch them products they don’t need—and as long as you’re willing to take no for an answer — cross selling will strengthen your relationship with existing customers. Again, this is because they see you’re looking out for their needs, not just trying to make a buck.

5. Develop more leads

One of the elusive advantages of cross selling is that it can increase leads. If you have loyal customers who feel cared for, they will be the first to recommend your services to someone else. So not only are you getting leads, but you’re getting the best kind of leads—referrals.

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Do you have any additional strategies for cross selling? How has it worked for your customer loyalty?