“Would you like fries with that?”
That phrase is the most familiar example of upselling in the world. As cliché as the phrase made famous by McDonalds may be, it still strikes at the heart of the add-on issue. A report from Forrester Research states that on-page recommendations create 10 – 30% if eCommerce revenues, and as much as 35% of online retail titan Amazon. You might say add-ons are a big deal!
The basic concept is that while selling your big ticket items, once you’ve clinched the sale and you have the customer in “buying mode,” you offer him or her something else.
Of course, there’s a good chance you are not selling hamburgers, so your best add-ons may not be quite as obvious a fries. What’s more, McDonalds’ French fry offer is actually a bad sales manoeuvre, as it uses a closed-ended question, leaving customers able to say “no” with great ease.
You can add a wide variety of items to customer orders to increase your profits – much more than simply obvious add-ons, like fries. You see, the reason McDonalds offers the fries isn’t just because they go so well with “two all-beef patties, special sauce, lettuce, cheese, pickles, and onions – on a sesame seed bun.” Fries are cheaper to make than burgers, thus they have a higher profit margin.
McDonalds does not release its costs as public information, but you can assume that the company is driving down the cost of the items it sells whilst leveraging its massive selling volume in a way that simply won’t apply to most businesses.
That’s why, in this essay, we are focusing on how you can add high profit margin items to your sales to increase your profitability exponentially.
Although all of the types of products we’ll discuss in this essay loosely qualify as “add-ons,” we’re going to break it down further and sort them into five distinct categories.
To help you make the most of add-ons in your business, we’ll cover the following in this essay:
- Traditional add-on offers
- Cross Selling
Let’s dive right in a find out how using add-on tactics can increase profitability!