It can be difficult enough to create a loyal customer base for your eCommerce business. But once you've established a solid customer base, what's next on your growth journey?
If you're looking to maximize eCommerce revenue, increasing your average order value through upselling and cross-selling is an important strategy to implement.
Upselling involves stacking relevant upgrades or additions onto a product, increasing the amount your customers spend in one transaction. Think about a time when you’ve felt inspired to switch to the premium version of an online service without advertisements, or been encouraged to add a maintenance plan or extended warranty to your new electronic device or extra toppings on your pizza. This is what upselling looks like and can be a legitimate and effective sales strategy when used properly.
Cross-selling is a different tactic that follows the same principle. It involves encouraging customers to add separate items that might complement what they’re already about to buy, just like when you are asked to turn your burger into a meal by adding a drink and some fries. Both strategies can be highly effective and transform your sales revenue if you do it right.
Below, we'll discuss the benefits of using these strategies and some ways that you can apply each technique to optimize your eCommerce site and increase revenue.
The Benefits
Increase Revenue
The most obvious benefits of adopting these strategies is that it will ultimately result in higher average order value and increased revenue. Providing a positive experience can also result in lifetime customers that will continue to come back again and again.
Improve Customer Experience
Upselling and cross-selling techniques can help customers to locate products they may have already been looking for to supplement their purchase, so these strategies make the shopping experience easier and faster. A better customer experience is always a good thing for your business. If you're looking for more ways to improve the customer experience, Virid can help.
Visibility
Even if customers don’t end up choosing the upgraded product or the add -ons, these strategies can provide visibility for your products so customers know that they have options and are aware of everything that you offer. For brick-and-mortar stores, this involves placing items in the customer’s line of sight, while online shoppers might see a list of suggested products on their checkout screen, encouraging your customer to learn more about your products and how they could benefit them in the future.
When to Use Upselling
If you have a brick-and-mortar store, it can be helpful to strategically place premium items next to basic items to increase visibility and give customers the option to upgrade right away. Upselling works better for higher ticket items like electronics, where there are clear benefits to different models. Upselling can be less challenging than cross-selling, as customers can usually see the benefits of the upgrade without much encouragement. A good time to use upselling tactics is in email marketing related to past purchases to offer the advantages of an upgrade to a product they already own.
When to Use Cross-Selling
You’ve probably seen a “customers also bought” or “frequently bought together” section on a product page if you’ve ever shopped online. Cross-selling can be extremely effective for consumable add-ons, like replacement filters for a water filtration system or batteries for an electronic device. This is your chance to anticipate your customer’s needs and provide them the opportunity to find everything they need in one place. You can use email marketing for this as well by sending targeted follow-up emails with product suggestions that might complement their previous purchase.
Best Practices
Personalization
It’s important to understand your audience before you try to use these strategies. Get to know them and their needs before and after their purchase to stay relevant and maintain a growing relationship with them so they continue to come back. Product recommendations should be personalized and relevant. You can automate this with artificial intelligence to provide the best recommendations that accurately predict what your customers want.
Add Value
If you’re planning to use upselling or cross-selling, it can be even more effective if you offer exclusive discounts on bundles that combine multiple products for a special price. This gives customers even more reason to purchase add-ons through you rather than after the fact with a competitor. It’s important to focus on not just the price, though. You should highlight the advantages of adding on or upgrading as well as that should be the primary motivation for taking action.
Testing
The best way to measure whether your strategies are effective is to conduct testing after the fact and make adjustments accordingly. Calls to action can be tricky to design, and it can be hard to predict what your customers will engage with. This is why it’s so important to constantly monitor and evolve your strategy to ensure it meets your customers where they are.
How to Get Started
Using these techniques to boost order value and provide more for your customers gives them another reason to choose you over your competitors. If you’re looking for strategies to boost conversions and increase AOV for your eCommerce site, your eCommerce platform could be holding you back. If you’re ready to realize your website’s true potential, schedule a consultation with Virid today. Our eCommerce platform, marketAgility 7.0 is your all-in-one solution.
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