October 29, 2021

What is Upselling? 

Many businesses find it difficult to make recurrent sales from customers. This article highlights what it takes to upsell and make recurring revenue which is every
What is Upselling? 
Shawn Khorrami
What is Upselling? 

For any business, increasing sales and revenue is a primary goal. However, finding the right pricing and sales strategy to drive sales and increase revenue might not always come as easy.

Upselling is a simple but effective strategy that can significantly improve sales, generate additional revenue and increase profit margins for your business.  

In fact, Amazon, the second-largest company when it comes to revenue generation, reported getting a 35% increase in sales from implementing upselling strategies.

For beginners, marking a distinction between upselling and cross-selling methods might also be unclear. 

In this article, we will explore in detail all you need to know about upselling, the difference between upselling and cross-selling, and how you can use these strategies to boost sales and revenue. 

Here's what we are going to look at: 

  • What is up-selling and cross-selling? 
  • Why is upselling and cross-selling important? 
  • 6 upselling & cross-selling strategies to increase revenue 
  • Upselling strategy examples
  • Upselling best practices 

What is upselling? 

In simple terms, upselling is a sales technique that persuades customers to purchase an upgraded or premium version of an existing product for a bigger sale. The goal with this technique is clear - to increase sales and ultimately revenue. 

Some upselling examples could be offering extended warranties on a travel bag or adding a premium feature on a car to increase the value of the product. The important thing to note here is that upselling techniques have to do with add-ons or product upgrades. However, it is only effective when it adds value to your customer. For example, the extended warranties on a travel bag could give a customer who travels often some peace of mind. 

What is Cross-selling? 

Cross-selling is a strategy that involves selling a different product to a customer to increase the sales value. This product is often from a different category but complementary to the existing product. 

For example, some cross-selling opportunities could be offering a laptop bag when a customer purchases a laptop. Another example could be offering a large size drink to go along with some French fries. 

Difference between upselling and cross-selling 

Both cross-selling and upselling strategies can increase average order value and lower the cost of acquiring new customers. The major difference between upselling and cross-selling is that upselling persuades a customer to buy a more expensive or upgraded version of a product while cross-selling involves persuading customers to buy related or complementary products. 

Why are upselling and cross-selling important? 

As an online retailer or business owner, using both upselling and cross-selling strategies can improve your customer's shopping experience and increase your sales and revenue. 

Here are a few reasons why upselling and cross-selling is important: 

  • Firstly, both upselling and cross-selling helps to deepen customer relationships. When done right, upgrades, premiums, and add-ons add value to the customer, improve satisfaction and ultimately generate more revenue.
  • Secondly, cross-selling and upselling to existing customers is cheaper and easier than selling to new prospects. Research reveals that you have a 60-70% chance of selling to existing customers while you have a 5-20% chance of selling to a new prospect. This is an easy way for ecommerce business owners to accelerate growth. 
  • Next, both strategies help increase Customer Lifetime Value (CLV), which is the average profit a single customer will bring throughout the business relationship. A higher CLV means your customer generates more revenue for your business. It also means you don't need to invest in acquiring new customers. 
  • Upselling and cross-selling improve customer retention which ultimately increases revenue. 

6 upselling & cross-selling strategies to increase revenue 

Here are a few tips and techniques for upselling products and services to increase revenue on your online store: 

  1. Choose an offer 
  2. Consider price margin 
  3. Add complementary products
  4. Provide social proof 
  5. Offer free shipping 
  6. Create a sense of urgency 

Choose an offer 

There are various types of ecommerce upsell and cross-sell that you can offer: 

  • You can ask customers to get a version upgrade of a particular product. It could be a bigger or faster version of your product. 
  • You can offer a product protection plan that allows customers to extend their warranty to safeguard their product. For example, you could offer a 12-month shoe repair warranty. 
  • If you're upselling services, you can offer extended service periods. For example, you can offer a discount for early renewals. 

Consider price margin  

An overpriced upsell offer can ruin the customer experience and the overall objective. 

For example, if a tote bag is $20 and you upsell the product to $40, your customer might be completely turned off altogether since it's two times the initial price. 

But if perhaps the price falls at $30, your customer will more likely purchase the bag since there isn't much of a price difference. 

We suggest that you keep your price margin at least not more than 30%

Add complementary products 

You can add complementary products that can be used alongside the main product. For example, you can encourage customers to add camera lenses or a camera stand to their camera for a discounted price. 

On Amazon, you would usually see this strategy displayed as “Frequently bought together”. You may also see “You might also like” or “People also viewed” sections. 

You can also recommend seasonal collections. For example, beachwear and some sunscreen to go with it for the summer. 

Provide social proof 

Social proof lets your customers know that the product you're offering is valuable. It acts as validation and helps remove any objections potential customers may have. Sites like Amazon utilize this so well. They show recently viewed products with good reviews that other customers are buying. 

Ensure you add positive customer reviews to the products on display. This increases your upsell opportunities and encourages customers to purchase more products. 

Offer free shipping 

9 out of 10 online shoppers say that free shipping is a major incentive for shopping more online. You can add a cart limit that customers have to qualify for to get free shipping. This will increase upsell opportunities and make customers buy to reach the threshold. Additionally, you can add reminders that show the customer the cart value threshold for free shipping. 

Create a sense of urgency 

One way to increase the value of your upsell is to create a sense of urgency. You can simply add a timer to a special discount you might be offering. If your product is valuable and customers know they will miss out on an offer, they will otherwise purchase the product immediately. 

Upselling strategy examples 

As we mentioned earlier, upselling is a powerful technique to increase sales and revenue. You might also notice that most companies and brands use a combination of upselling and cross-selling strategies to boost sales and increase revenue.

Here are a few well-known brands that are using upselling strategies effectively: 

Dollar Shave Club

Dollar Shave Club is an online company that operates by selling subscription boxes with customized items. The company offers to restock options for monthly subscribers and sets reminders to alert customers when they are running low on razor blades and moisturizers. They also employ cross-selling techniques by offering additional products and creating a sense of urgency to compel customers to buy. 


Amazon has been able to increase revenue using upselling strategies as well as cross-selling strategies. 

Using the “Subscribe and Save”, Amazon allows customers to subscribe to a recurring order of the same product in exchange for a discount.

The benefit of this upselling strategy is that it helps with retaining your existing customers. By automatically sending a new order every month to your existing customers for a discount, customers are sure to see the value of making long-term subscriptions in advance. 


Apple uses its upselling strategy so well that they have managed to build loyal customers who purchase their new product every time it is released. 

Through Apple Premium, Apple offers products that customers want to buy but at a higher price. They also use cross-selling strategies like offering customers accessories or other products that make their purchase is complete. 


ASOS is a British company that sells fashion items. The company uses upselling strategies by offering discounts on shipping if the total purchase exceeds a certain price. They also use cross-selling strategies by recommending products each time a user views a product. 

Upselling best practices 

To profit from upselling, you want to make sure that your customers do not perceive that their needs are not being put first. You don’t want to appear too pushy or ‘salesy’ as this can put off your customers. 

Here are a few upselling best practices you need to put in mind: 

  • Seek to understand your customers and create an offer based on what they tell you
  • Make an offer that complements the initial purchase
  • Make side-by-side comparisons. If customers see the value of the upgraded product side by side the lesser, they will be encouraged to upgrade 
  • Avoid offering products with prices too high from the products your customers have in mind. You can encourage customers to upgrade by offering discounts on your premium packages
  • Educate your customers on the benefits of upgrading to a particular package.

Final thoughts 

To attract customers, it is important to offer products and services that align with their needs. 

If done right, upselling is an effective sales tactic that adds value to your customers while increasing sales value. It also helps to increase customer lifetime value and helps decrease the cost of acquiring customers. It also builds customer loyalty as customers are likely to purchase additional products. 

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