S3 E5: Increasing customer spend & 'upselling'

Episode Notes:

We all want to make more money in our businesses, but 'getting more customers' as we all know, is easier said than done! It takes huge amounts of effort and testing different marketing strategies to get new customers and through the door, and sometimes even if we are getting the clients, there's a limit to how many more we can physically take on and say yes to, especially when starting small and a solo business owner.

But there is an easier way; a way to make more money but from the same amount if not fewer customers.

Increase the average spend per customer, and get more VALUE per sale.

Read more about converting ecommerce customers at: https://www.byrosanna.co.uk/blog/convert-ecommerce-website

Read the transcript

Welcome to season three, episode 5! I'm excited for today's topic as it's something I think can bring huge value and make a real difference in a lot of businesses who are struggling to increase customer numbers.

Before we get into it I just want to remind you that I am currently running a giveaway this season, so anyone who leaves a written review of The Freelance Fix, either on the Apple Podcasts app or on Spotify, will be entered to win two of my desk planners - a daily to do list planner and a weekly planner. I'll be choosing a winner at the end of this season around the beginning of May, so be sure to leave your name on the review and give me a message on Instagram once you've left one! I'm @by.rosanna, or email me at contact@byrosanna.co.uk.

Anyway! When it comes to making more money in your business WITHOUT increasing the number of customers you have, there are essentially two different strategies you can take. 

The first is to increasing your prices. Now I know depending on your industry not everyone can do this, and this obviously needs to be a well thought out decision. 

In certain industries, it's a standard process to raise your prices by a certain percentage each year - for example for lawyers and other professional services. However for many businesses, a raise in prices is going to come with some questions from customers, and you really need to be able to justify the increase, making sure that peoples' perceived value of your product or service, matches up with the new price. 

You can do this by adding to or improving your product or service, or by targeting a different area of the market, or by improving your marketing communications to better, but you always need to be able to justify this, and it can take a while to prepare for this.

The second option is honestly what I think can be the most impactful, and that is 'upselling'.

Upselling means encouraging a customer to spend more with you by offering them additional features, products, or services alongside the original thing they were planning to buy.

On the surface, it could come across as sounding a bit sleezy, but trust me when I say that every single business in every single industry does this, and it doesn't have to come off in a pressured or manipulative way at all.

The whole reason why this is the most effective strategy for making more money in your business - more so than onboarding new customers - is because your clients are already primed and sold on YOU and your brand. If they're already spending money with you, they've already reached their buying decision and have mentally and emotionally bought into your business. This makes the option of spending a bit extra with you WAY less of a step to take than it is to decide to buy something in the first place, like a brand new customer does.

And when you think about it, a good, well thought through upselling strategy is simply a way of helping your customers to find more solutions to their problems. It should be a positive thing for both parties.

So what are some ways to upsell in your business?

• The first tip is to try 'bundling' your offerings. This is where you add multiple complimentary products or services into some kind of a 'bundled package' that makes it super easy for someone to get everything all at once.

  For example if you were shopping on Amazon for a new pillow for your bed, you might click on the page and find that Amazon have automatically created a bundle for you that includes the pillow you clicked on, plus a new set of sheets, or maybe a new duvet. By doing this they've made it incredibly easy for you to buy more items that they're guessing you might also need, with just one click so it's no extra effort for you.

  Another example might be if you're buying an ecourse or some kind of digital product, and the seller might also have the option to buy it as a bundle along with a complimentary ecourse and an ebook, and some templates etc.

  Of course these usually only make sense if they're well tailored to the target customer, but what this does is hopefully remind them that they also need these other products, or make them see that this is what 'other people have often bought together' - which is what Amazon's bundles say, giving that added sense of social proof - 'Oh if other people are doing this I probably should too'. And you're basically serving them this in a way that's incredibly easy for them to say yes to.

• You can also offer products, packages or services that have recommended 'add ons'  that are clearly suggested to the customer before or after they pay.

  For example when you go into a restaurant and order dinner, they will usually ask if you want dessert and show you the menu, as a recommended add on to your experience; more often than not, seeing that menu will probably tempt you to say yes, which is obviously beneficial to making the restaurant more money.

  Let's think of this for a service based business; for example a photographer. At the point where you're discussing being hired to photograph someone's wedding, you might also suggest they want to purchase a photo album or framed print from you as an add on. This is something you could also mention AFTER the service, and even give them some kind of mockup or visual example so they can imagine it and further encourages them to say yes.

  For my website design clients, in their Website Launch Guide packs that I give to them after the service, I also include information about my marketing courses in case they need help marketing their business.

  Meanwhile if you're selling products and have an ecommerce website, you should usually have the option to add a 'recommended products' feature, which adds a feed of related products underneath the product a customer is viewing. This is really simple to set up in Squarespace if your website is running on that!

• Another option is to create offers & discounts that encourage people to buy more products in one go. Typically you'll see this in supermarkets where you get 'three for the price of two' offers, which gets customers to consider spending double the money they were originally planning to, as there is an incentive there for them.

  This works well with the bundling strategy, as you can always offer a discount when a bundle of products are all purchased together at the same time - for example if you were a stationary designers, you could suggest that if people purchase a note pad AND a calendar, they get 10% off the total order, or perhaps a free set of stickers.

  In my website design business, I offer my website design clients £50 off if they choose to book a brand design service with me at the same time. So usually my brand design service costs £450, but if they book me for a website at the time same they'll get it for £400.

  Offering discounts in this way can also be used to create a sense of urgency. If you find people are interested in your bundle or offerings, but just aren't biting and getting distracted, this could be solved by adding in some kind of time-bound incentive to make people act NOW rather than waiting.

  For example you could set up limited time discounts for bundles, or for add-ons that only last a certain amount of time after a customer has purchased the original product. 

• The last suggestion I have is to reward your customers for spending more with you. You see this a lot in ecommerce stores where customers are rewarded with some kind of discount or maybe free shipping when they spend over a certain amount (for example, 'get free international shipping when you spend over £50'). But you can also create things like loyalty schemes, or even just making sure that when a customer purchases from you, they are added to a specific 'customer only' email list to receive exclusive discounts and new promotions from you.

In most ecommerce platforms you should be able to see a list of customers and see each one's 'customer lifetime value' - aka, how much in total each customer has ever spent with you. If you're a service-based business, be sure to keep a CRM system with all your client details and spends in it so you can see information like this easily too.

What you can then do is reach out individually to the people who spend the most with you, and thank them personally, either through email or with a handwritten note. This is a super personal touch that will make you really stick in their memory, and chances are they'll shout about that to their friends and network too!

So there you have it - some of my best tips for upselling and increasing individual customer spend so that you can make more money with FEWER clients. 

If you have any questions and want to carry on the conversation further, as always you can come and chat with me on Instagram - my username is @by.rosanna and I love to see when people are listening to the podcast so feel free to take a screenshot and share on your Instagram stories when you do!

Thanks so much for listening!