The Advantages of Cross-Selling and Suggestive Selling in Retail
If you have been in retail for any length of time, you know that the first item you sell is not the goal; the true goal is to get to a second and third item on every sale. The technique of cross-selling or suggestive selling is even more important today for retail as the customer is usually very "driven" when they enter your store. In other words, they have a list and know what they want. They get it and get out. While some may argue any sale is a good sale, your bottom line (P&L) would not agree.
Think of it this way. If it cost you $25 to get the customer in the door and you sell them $25 worth of merchandise, you actually lost money on the transaction. If you sell them $50 worth of merchandise, you break even. But, if you were able to sell them $100 worth of merchandise, then you make money.
The Two Types of Add-On Sales
Suggestive selling has been an important sales technique in retail for generations. Essentially, there are two types of add-on sales. They are:
- Extra Category
The accessories merchandise refers to items that are directly related to the product the customer is purchasing. For example, a soft case for the digital SLR camera or a drain hose for the washing machine or a belt to match the shoes. These are all items that work in concert with each other and raise the customer's satisfaction and experience levels.
The extra category, though, refers to merchandise that is not related. So, let's say the customer came in for a pair of sandals and you show them the new crop pants you just got in. Or the customer came in for a new shovel for her garden and you show her the latest plant food product that just arrived.
Using Suggestive Selling to Your Advantage
In both cases, you are using suggestive selling to introduce the product. And also in both cases, if you spend some time asking the right questions (what's also called researching with the customer) at the beginning of the sale, you set yourself up for suggestive or cross-selling later in the sale. In other words, the more questions you ask at the front of the sale about the customer's wants, interests, needs, concerns and desires, the more "ammunition" you will have to sell with later.
Think of it this way: If the customer tells you they are shopping for a shovel, then you should ask questions about the project they are working in, the type of projects they love to do, etc. If you listen carefully, you will see opportunities to cross-sell in your store. Once you know the project, you can suggestive sell other merchandise that may help them on the project. Or you can even suggest other merchandise for similar projects since the customer told you how much they love these types of projects.
Suggestive selling is not upselling. Upselling is the process of introducing customers to higher priced (or higher margin) merchandise in order to increase the value of the ticket. What we are describing here is adding more lines to the sales ticket and not just selling another more expensive item. Remember what we said in the first paragraphs — the profit comes from the second and third item because the ad costs to get them on the door are the same. So it is not about selling a $100 item versus a $75 item.
Suggestive selling refers to the simple practice of introducing customers to other merchandise in your store. Try phrases like:
- "Have you seen the new _____ we just got in?"
- "When was the last time you tried on sandals?"
- "Feel this fabric, isn't it so soft?"
- "Can I get your opinion on this, we just got it in?"
In all of these cases, you are suggesting other merchandise to the customer by using suggestive phrases.
Try this challenge — write down as many suggestive selling or cross-selling phrases as you can. Make it a competition with others in your store, and you will likely be amazed at how many you can conjure up.