7 Upselling Strategies & Techniques That Work

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Upselling is a sales technique that increases the value of a transaction. This is done by suggesting an upgrade or add-on for an item or service a customer already planned to purchase. The unofficial McDonald’s catchphrase of, “Would you like to supersize your order?” (i.e. swap out a small for a large) is a classic example of upselling. 

7 upselling strategies & techniques for 2023

1. Use first-party data to identify customer needs & interests

First-party data is the data you gather from customers' direct interactions with your business (e.g. on your website or app, or via a form). By analyzing customer behavior, you can learn about their needs and interests, and as a result, personalize each interaction. 

A needs-based upselling technique highlights something you know a customer will find useful or relevant. For example, when suggesting a more expensive subscription, you can highlight the benefits of more complex features, wider app integration, or a larger storage size – depending on what you know about that customer's app usage history, feature requests, or customer service conversations.

As we inch a little closer to Google’s target deadline for phasing out third-party cookies, first-party data will become more useful and important for marketers. It will enable you to keep learning about your customers’ journeys, and provide personalized recommendations while safeguarding their privacy.

2. Don’t upsell everyone – target customers for upselling based on certain metrics

When determining whether or not to upsell to a customer, consider their past behavior on your site and how receptive they might be to your proposal. Metrics such as time between purchases, average spend, product usage, and satisfaction can be great indicators of whether or not an upsell will work (e.g. suggesting a premium package to customers with a high lifetime value rather than to a customer who’s engagement rate has been dwindling). 

For customers who don’t meet your criteria, decide whether you have opportunities to cross-sell instead, or how to nurture the customer relationship to create upselling opportunities in the future. 

3. Time your pitches carefully & nurture them over time

Sometimes, you have the opportunity to upsell right before the customer confirms their purchase. Other times, it’s best to wait. 

Say a customer is using a free version of a budget management app. If your data shows that the customer has used your app every day in their first week, send an offer to try the premium version a few days later. 

But if a person seldom uses your app, focus on nurturing other aspects of the customer relationship before going for an upsell. Offer useful content through social media marketing, email, or push notifications. Send surveys to get feedback on their experience. On their dashboard, highlight features they haven’t used yet. Once the user reaches a certain level of engagement – say, using the app at least four days a week for three weeks straight – offer an upgrade.

4. Utilize multiple channels – but don’t overdo it

With the growing use of omnichannel messaging platforms, it’s easy to send messages to customers on many different channels. But the point of omnichannel communication is not to reach a customer in as many ways as possible. It’s about reaching a customer on their preferred channels (you can learn more about how to determine that here.)

For example, you could send an upsell message via a push notification in an app, and follow up later with an email. 

5. Use visuals to show the value of your upsell

A customer will agree to an upsell only if they see how it would satisfy a need or a desire. But you only have a few seconds to convince them – after all, who reads everything on the checkout page or in an email thanking them for their purchase? Visuals help you capture your customer’s attention within that brief window of time.

A visual upselling message typically includes:

• Short copy that emphasizes the benefits of the upsell

• An image or illustration

• Bulleted lists or checklists comparing the original product or service with the more premium option

• Contrasting colors to highlight the differences between the two choices

You see these elements in play in the example below:

Source: Airtable

6. Offer a discount – but make it time-limited

One way to convince a customer to upgrade is by offering a limited-time discount to create a sense of urgency. Perhaps it’s a lower subscription rate for the first few months, or a one-time discount  code. If you’ve tailored the upsell to the customer’s interests, this added incentive can just be the push they need to convert. 

7. Sync your upselling & cross-selling efforts

Leveraging customer profiles (which unify first-party data) is a great way to determine who will be most receptive to upselling. 

And if a customer doesn’t fit your criteria for upselling, consider a cross-sell instead. Say you manage a vacation home rental platform and a user has limited their search results to rentals that don’t cost more than $200 a night. It’s ill advised (and a bad user experience) to show that person properties over their specified limit. But you could surface other offers, like signing up for a guided tour or adding on a rental car. 

Why first-party data is the foundation of a sound upselling strategy

First-party data reveals the relationship a customer has with your business: the interactions that led them to convert, the pages they’ve viewed, or they’ve purchased. Depending on what information you deem relevant, first-party data might also tell you things like the city where a customer lives, their job title, and the number of employees in their company.

All this information helps you determine when, where, and to whom you should deliver your upselling pitches. A customer’s purchase history, for example, would indicate the amount of money they’re willing to spend, and what add-ons they might deem useful. Past behavior can show whether a customer is more likely to click on an upsell during the checkout process or in a post-purchase email. With this information, you can then tailor your upselling techniques to each customer. 

Master your first-party data with Twilio Segment

Twilio Segment, a customer data platform, collects customer data from multiple channels and unites them in a single, centralized database. It then creates in-depth customer profiles that are updated in real time based on the customer’s most recent interactions with your business. Twilio Segment lets you identify common behavioral patterns and characteristics among your customers, enabling you to create accurate customer segments. You can then use your data-driven, in-depth, up-to-date customer profiles and segments as a basis for determining which customers fulfill certain upselling criteria.