Upselling and add-on sales… Are they worth the effort?

By Stan Rydzynski

    Selling requires understanding your customer’s needs and delivering a proposal that meets their budget. But you’re the electrical expert and it’s your job to provide your expertise to your customer. Frequently this involves advising them on better, more pertinent, products or sharing ideas that further benefit them.

    Upselling involves marketing and selling more profitable services or products to your customer. It is a sales technique whereby a salesperson is trying to persuade the customer to buy more expensive goods or services than they’ve requested. Done properly this can add significant sales and profits to your business. Think of it this way … when you go to the car wash, do you get the basic package or do you get the package that includes waxing.

   At the same time, cross-selling involves marketing and selling products that complement what the customer’s expressed needs are. Again with the car wash, think of the other services that are offered at the station … if it is a drive-through car wash they typically offer gas or food products; if it is strictly a car wash they usually offer vehicle cleaning products inside the office. From an electrical viewpoint, if someone needs lamps changes do they have the switch on a dimmer? If not, could you suggest one?

   And it is possible to combine upselling with cross-selling.

  Since the current economic climate is either stagnant or depressed, upselling can be a very cost effective sales and profit development strategy. Frequently the biggest challenges are understanding your “good, better, best” product alternatives; your confidence in discussing this with your customer; and your ability to train your staff (your local distributor should be able to help ,,, if he can’t … perhaps you need to consider a change to one that offers value-added services that can grow your business!

      Cross-selling can offer even more opportunities. Consider … many contractors visit their favorite fast food restaurant daily, even, weekly. After you place your order, the part time minimum wage clerk/cashier asks if you would like any apple pie or ice cream. You say “yes” or “no” and the clerk says “thank you” and proceeds to fill your order and gives you change, if appropriate. Are your workers schooled as the clerk in the fast food restaurant is? Do you have pre-planned add-on sale items or services that you can quickly present on every service call? Do your electricians/service people know how to identify and response to an upsell situation? If not, do they need product and/or sales training?

     From a marketing prospective, upselling and cross-selling need to be a formal preplanned marketing/sales goal. This is such an important selling element it can not be handled as an after-thought. Let’s say you are called to a home where you will be adding a PAR light cluster at the back of the house to light up the yard. After you arrive and start working you keep a look-out for the “dirty dozen”:

1. Upgrading the light source. Consider the placement … should you offer CFLs. LEDs for greater longevity, especially if the installation is high or in an inconvenient location?
2. No outlet in the backyard.
3. The customer hadn’t thought about putting it on a timer or a dawn to dusk control, or even a motion sensor.
4. Nice landscaping, but no landscape lighting.
5. No GFCI in the bathroom.
6. No GFCI in the kitchen.
7. No Smoke or CO2 detector (or a combo unit).
8. No dimmer in the kitchen or dinning room.
9. 50’ extension cord used to power the above ground kiddy pool.
10. No timer for the front door light.
11. No receptacle in the front of the house for holiday lights.
12. No surge protector at the panel to protect the house.

    The list can be much longer but I believe I made my point. Next to each upsell/cross-sell item is, there a price? Or, are the service people/electricians instructed to call you (generally, the on-site person should be able to close the order since he/she will have the established a trust factor).

    The same can be done for a commercial or industrial situation. Safety violations, OSHA issues, broken receptacles or plugs/connectors, panels or boxes with no covers are just a very small sample of upsell opportunities and even larger energy efficiency/retrofit opportunities.

    Make upsellling and cross-selling part of every sale, especial in today’s sluggish economy.

Stan Rydzynski, Executive V.P., Channel Marketing Group, has over 35 years of experience in marketing/sales/product excellence in the electrical industry. The Channel Marketing Group provides strategic planning, marketing planning and market research for contractors, manufacturers and distributors with a focus on growth initiatives to accelerate performance. If you have a marketing/strategic planning question, you can contact Stan for a FREE consult at srydzynski@channelmkt.com or 516-319-1191. In addition, Stan conducts a 2-3 hour marketing/planning contractor seminar covering basic marketing concepts as well as teaching how to write an effective contractor marketing plan. Contact your local IEC, NECA chapters and/or your local distributor to arrange for him to conduct his highly effective and informative seminars.