Should We Invest Heavily in Cross-selling?

The idea of cross-selling enhancement has been always attractive to us as marketers. Quite often it’s perceived so obvious and simple in terms of its logic that we start thinking that this is the same logic that consumers have.

Actually, there are so many possibilities! For cross-selling can be used either existing product/ brand portfolio or it can be put as one of KPIs for brand, product or category extensions.

Once I worked my team on the understanding why this simple logic which everyone among us have clearly understood didn’t bring the expected sales results. To be true they were, but very short term.

If I could describe the situation in consumer words they would be like following: “I see your offer and it’s really attractive for me, so that I buy these two products today… But in the future, why should I switch?”.

Reading Sharp’s book (2010) I found his idea valuable to share: “there is little difference in cross-selling metrics between competing brands, and the small difference that do exist tend to reflect market share- not whether or not they have dedicated cross-selling program“.

So, quite often ambitious cross-selling plans don’t bring long term sales results and at the end don’t have high ROI.

Attributing to this point Sharp (2010) underlines: “dramatic changing cross-selling metrics is difficult and expensive“.

Therefore, I would recommend to analyze the overall category effectiveness of cross-selling campaigns both in terms of their short and long term volume uplifts in order to set the right expectations.

Secondly,  if you believe in game changing in your category, then this campaign shouldn’t be limited just by on product and POSM communication. It should go much further than just in-store environment and are better to utilize multi channel communication.

Cross-selling

Source: http:// shopware. orangefluid. com/

Sources: Sharp, B. (2010). How Brands Grow: What Marketers Don’t Know, Oxford University Press, Australia

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