Online Marketing Case Study: ‘Upsell’ Strategy Boosts Online Sales By 56.3%

The best time to sell online is when customers already have their credit cards out.

In this case study video I deconstruct a real upselling strategy, showing you how adding a simple upsell process increased sales by 56.3%!!

Enjoy….

Watch the video: Website Upselling Case Study on YouTube

A transcript of the video is here:

Hi, this is Will Swayne from Marketing Results which is at www.marketing-results.com.au.

I’ve got a really interesting case study video to share with you today. This case study video is on the power of upselling. In this video, you’ll learn how we increased order page conversion by 39.2% while also simultaneously increasing average transaction value by 12.3% for a net revenue gain of 56.3% by just changing one thing.

As I mentioned this video is on upselling and upselling is basically the “Would You Like Fries With That?” strategy.

The principles to underline this strategy are a couple of things:

• Firstly, when customers are buying, don’t stop selling.
• Secondly, one of the cardinal sins of marketing, I believe, is actually limiting the value that you offer clients. There may be clients among your customer base who would buy more elaborate products or larger products or bigger bundles or products with more features, if you offered them. The fact that you don’t offer them is the reason why they’re not buying them.

So let’s quickly talk about upselling. Well there are a few people in the internet marketing community who are talking about it but very few people who know how to do it. Even fewer can quantify the value of doing it and almost no one is actually doing it. So in this example, I’m going to show you an actual example where you’ll see how to do it and what the potential results can be.

The website you see in front of you is a website called candlemakerscompanion.com which sells primarily a $27.00 e-book on how to create beautiful artisan candles for fun or profit and as you can see from this website, it’s a traditional sort of sales letter style website. There’s a sales letter, there’s a guarantee and then it’s $27.00 and by clicking on this ‘add to cart button’ you then proceed to an order page.

We actually tested two order pages. The first order page in the test looks like this where it says, “Yes! I want my copy of The Candle Maker’s Companion.  Get the Candle Maker’s Companion Plus $65 Worth of Bonuses for just $27.”

There’s a number of strategies in evidence there:

• One of them is this sort of affirmation strategy prior to purchase to make it very clear on the value that the client recieves
• Secondly is bonusing – to receive a lot more value than the sticker price.
• One is having an image of the product
• Another one is actually valuing the individual bonuses
• Reiterating the money back guarantee
• Having some privacy assurance messages, credit card and payment logos
• A checkout button or an add to cart, “click here to claim your copy now” buttons

But the key point that I want you to notice here is that there’s only one option which is what most people do. So we tested this original version against a different type of off page which you can see here.

So this page is very similar. It says: “Yes! I want my copy of The Candle Maker’s Companion.” There are two options for you to choose from. Please read below and make your selection. Below there—there are actually two boxes.

Here’s the first box which is identical to the first; adding it to the cart here. And here’s option two which is a bundle: “You can get the Candle Maker’s Companion plus the Handcrafter’s companion for just $17.00 more!” So again it’s adding a lot more value for a nominal increment in price. So it explains the connection between the two products. I’m not going to read it all but I’ll just read the first paragraph.

“The Handcrafter’s Companion is a complementary volume to The Candle Maker’s Companion. It provides you with everything you need to create fragrant bath and body products, for fun or profit!”

Further down, we say that: “The Handcrafter’s Companion is actually sold on its own website for $27.00” with a link so people can verify the value. Then again there’s an affirmation statement to get both products for a very reasonable price of $44.00 with all the bonuses then itemized again and then you go to the checkout.

I’ll show what the checkout looks like; it’s identical for each side of the test. So whether they order the upsell product or the planned product, it will go to this sort of shopping cart page.

Okay so let’s look at the results between these two types of order page.

This is a Google Website Pptimizer which is one of the conversion testing tools we use to help our clients and ourselves increase our conversion results. The blue line is the conversion rate on that original order page. As you can see, these lines change, I’ll talk about that in a second. The orange line is the conversion line right on the page with the upsell.

So you notice that these pages sort of change every time; that is as more data is collected, we get more certainty about the true value of the long-term conversion rate of either option. As we get to the end, we find that on this order page, the conversion rate is 31.6% with the upsell and 22.7% with no upsell, in other words, just offering one option. So that means that of every one hundred people that come to this page and see the upsell; 31 purchase. Of every hundred people that come to the page and they don’t see the upsell, only 23 purchase.

So what does that mean?

That means that with a very high level of confidence, statistically speaking (which is all this stuff is about) there’s an actual conversion improvement of 39.2% by offering the upsell option; simply by offering the upsell option. And there’s also an increase in the transaction value because the upsell is obviously more expensive than the regular product. We actually find that about 19% of orderers choose the upsell and 81% choose the regular product. So that has an increased transaction size of 12.3%.

So, when you combine the increased conversion rate on that page of 39.2% and you also combine that with the increased order value, of another 12.3%, that produces a net revenue gain through this one strategy of 56%, which is pretty substantial. The other thing is that’s just a revenue gain. The cost of traffic remains the same. So in terms of profit, this probably has boosted profit by about 300% or somewhere near that number.

So that’s a working example of how to do upsells on the web. You can do this with an e-commerce product or you can do it with a lead generation scenario. For example, you might offer a free report and on the thank you page of the free report, you then offer people a chance to have a consultation with you or go to the next step in the sale.

I’ll leave it there. I hope that’s been instructive. If you would like to know more about how we can help you implement this sort of strategy on your website, along with enhanced traffic generation and other conversion strategies, then get in touch. Thank you!

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How To Combine Offline Marketing With Online Marketing

Mastering online marketing and lead generation is one of the highest-return investments your small business can make.  But after a while, even the most successful online marketers run into the problem of ‘diminishing returns”.

After all, if your online strategy is heavily dependent on search engine traffic (free and/or paid), your results will hinge on the total number of people searching online for your products and services.

For example, one of our clients operates a gym in a regional centre (Geelong’s Gym).  His website occupies 6 out of 10 places on Page 1 of Google for the major search terms.  So there is very little “upside” left on the search traffic front.  His marketing has to extend elsewhere if he is going to increase new customer volume. (Another effective strategy would be to work on increasing website conversion – but that’s another blog post!)

Combining offline and online is best

And note that I’m not merely suggesting, “if your online marketing hits a growth ceiling, you’re going to have to do more offline marketing”.

Rather, I’m talking about combining the best of both worlds – by taking advantage of the massive reach of “offline” and the superior tracking, automation and relationship-building power of “online”.

When offline traffic makes sense

Here are 3 situations when it’s worthwhile seeking out offline traffic sources:

1. When the value of each customer is high. An accountant may be happy to invest $1,000 in advertising to acquire 3 new small business clients, whereas an online candle shop with an average transaction value of $25 may think twice.
2. When you “know where your best prospects hang out”. Many offline publications, including magazines and trade journals, can be good places to advertise because of the high density of genuine prospects among the readership. A scaffolder advertising in a major building industry publication knows that many of the 10,000 readers are buyers of scaffolding.  The same ad in a major newspaper may be of interest to only 1 in 5,000 readers.
3. When online traffic is expensive. In some industries (e.g. financial services), one click from the Pay Per Click search engines may cost you $10 or more.  That makes many offline advertising opportunities look cost-effective!

The winning strategy

I’ve already mentioned that the major benefit of this strategy is combining the massive reach of “offline” with the automation power of “online”.

What this means is: you use your offline marketing to drive prospects to your website, then use relationship-building tools such as autoresponder emails to communicate with new prospects and maximise the value of the leads you generate.

Here’s how it works:

Your offline marketing piece (your ad, direct mail letter or insert) promotes valuable information of interest to your prospect, that can only be accessed via your website – like an opt-in Free Report, an Audio CD or DVD.

This information is called your “Lead Magnet”, and the most popular format is a “How-To Report”.   An accountant looking for more SME clients could publish a report called “9 Tax Minimisation Strategies No Small Business Owner Should Be Without – All 100% Legal And Approved By The ATO”.

Then on your website (or dedicated landing page), your prospect enters their details (either name and email only, or full address if you plan to send the promised information in the mail).

After that, your automated marketing takes over.  First of all, you deliver the information you promised, which of course has to be of high-quality.

Then you use email autoresponders and/or other types of follow-up messages to drive the next stage in the process (e.g. contacting you for an exploratory consultation.)

Remember that follow-up is CRITICAL to the success of this strategy.  NOT having at least 5 pre-programmed follow up steps will slash your results by 50 to 70 percent.

Top 3 offline media to test

The 3 most reliable media to test are magazines, trade journals and direct mail.

In each case, the value of response-oriented copy cannot be over-emphasised.  If you are not an experienced copywriter, find someone who is – don’t be ‘penny wise, pound foolish’.

You should always remember to track everything down to the last cent.  You need to know exactly how many leads, sales and dollars each promotion generates in order to optimise your results.

Here are a few more pointers for making this strategy a success…

Magazines and trade journals:

• Start with the most targeted publication possible (there’s a good list of magazines at isubscribe.com.au)
• Negotiate hard on price. You can often get good discounts for buying ‘remnant space’
• Test a small ad first – e.g. ¼ page
• Your response will tend to FALL when you run the same ad again, not rise.  So if your first ad doesn’t work – change it before running it again

Direct mail:

• The quality of your list is paramount
• Lists can be found via the Yellow Pages or list brokers
• Test small and roll out what works
• Postcards work well for promoting free offerings
• Rule of thumb: a sequence of 3 postcards will garner double the response of a single postcard

As Pay Per Click traffic gets more expensive and organic search becomes more competitive, business owners who know how to connect with the right prospects will come out in front.

I urge you to try this strategy, which is likely to work even better if you’re the first person in your industry to use this form of marketing.

A more detailed description of this multi-step marketing strategy is found in the free e-course, “7 Steps To Doubling Your Website Leads”, available here:

www.marketing-results.com.au/7steps

Will Swayne
Connect with me on Twitter! I’m @willswayne

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