How Lifetime Customer Conversations Drive Success
Plenty of time and effort is spent conducting studies to prove one thing that you already know—that engaging with existing customers can be much more profitable than trying to boost new customer acquisition.
Customer acquisition is certainly important. But the reality is that loyal customers will spend up to 10 times more over their lifetimes than new customers.
Your ability to cross-sell and upsell fuels the value of customer loyalty. However, there’s a fine line between the upselling strategies that win business and the ones that just feel disruptive.
Everyone has a horror story where they had to call customer support to solve a problem only to be met with an untimely sales pitch (and if you don’t have one, you’re lucky). How can you toe the line and create a more loyal, profitable customer base?
Don’t just focus on making another sale. Focus on fostering lifetime customer conversations that will naturally deliver more value over time.
There’s an Art and Science to Upselling
The line between successful and unsuccessful upsells may seem blurry to business leaders. Every customer situation is different and there’s no magic script or workflow that will guarantee results.
That’s why you have to master both the art and science of upselling.
The Science of Upselling Lies in Customer Psychology
Wouldn’t it be nice if you could just read your customer’s mind? Mind reading would make it a lot easier to understand what exactly each customer wants.
Mind reading may be off the table, but that doesn’t mean you can’t understand what makes for a successful upsell in the minds of customers. Back in 1984, Arizona State University Professor of Psychology Robert Cialdini published Influence: The Psychology of Persuasion to give business leaders a better idea of how they could get a “yes” from customers.
If you want to make your upselling more effective, keep these 6 basic psychological principles of influence in mind:
- Reciprocity: The idea that when someone gives us something, we are more likely to give them something in return. If someone pays you a compliment, you feel compelled to return the favor. In an upselling scenario, this means you should be providing value to the customer before requesting action in return. Think of how you can first give to customers before trying to capitalize on an upsell opportunity.
- Scarcity: We want what we can’t have. You can tell people how great your product or service is all you want, but if it’s readily available to them, they won’t feel any urgency to jump on an upsell opportunity. This principle revolves around communicating what a customer stands to lose without the opportunity you’re presenting. Limited time offers are the most common example of a scarcity upsell.
- Authority: Our brains are programmed to follow expert testimony and advice. If you come across as an authority in an upsell situation, customers are more likely to feel you have their best interests at heart.
- Consistency: People try to be as consistent as possible with what they say and do. This means that a successful upsell won’t just jump straight to a high-value transaction. Instead, Cialdini says to get customers to make small commitments that you can eventually build on for larger upsells.
- Social Proof: Now more than ever, customers are doing their own research before making purchase decisions. If you can prove there’s consensus around your upsell opportunity, customers will be more likely to engage.
- Personal Connection: This principle is fairly straight forward—we’ll buy into an upsell if we like the person who is pitching it to us. If we don’t feel the personal connection, we’re far less likely to make the purchase.
The problem is that you can follow all of these psychological principles to influence customers and still fail in an upsell opportunity. Understanding the science behind customer decisions is important, but there’s also an art to building trust for upsell success.
The Art of Upselling Is All About Trust
You have to be able to present an upsell in the right context for individual customers. However, many companies just have a standard pitch they deliver via sales/support agents. The intimate understanding of the customer’s personal needs is lost when you try to script the pitch.
The only way to build lasting relationships with customers is to delight them at every stage of their journey. Don’t think of communication with them as individual transactions. Have the patience to build a lifetime customer conversation that collects all the contextual data you’ll need to deliver a highly-personalized upsell that can actually solve their problems.
Aside from all of the psychological elements to influence, your relationship with the customer is the key to upselling. If you want to learn more about building those relationships effectively (and differently than any of your competitors), check out this white paper, Creating Delightful Moments Throughout the Entire Customer Journey.