Effective Cross-Selling Online

  |  June 2, 2006   |  Comments

The different types of online cross-and up-selling, and how, when, and where to employ each tactic.

Every e-commerce Web site has the same goals: convert browsers to buyers, maximize share of wallet, and engender customer loyalty. In this column, I tend to focus a lot on the customer loyalty piece. But share of wallet is critical for both first-time and repeat customers. That's where cross-selling comes in. Cross-selling products can be the most effective route to increase a customer's purchase order. Implementing it incorrectly, however, is a surefire way to confuse your users and risk having them abandon their orders completely.

Defining Terms

For the purpose of this column, let's review a few simple terms:

  • Competing products. These are products the user could purchase instead of the current product. For instance, if the user is looking at a Sony DVD player, a list of competing products might include the models above and below the current product in Sony's complete DVD line or comparable DVD players from another manufacturer.

  • Complementary products. These products are intended to be sold with the current product and can be used together. They don't compete with each other. Rather, they can be used in tandem to solve a problem or make the product more robust. A complementary product to the DVD player might be a receiver/speaker system, a hi-definition TV, or another component that would be part of a home theater system. These products are not necessarily from the same manufacturer.

  • Family products. These products are from the same manufacturer and part of the same line (in the same "family") as the current product. A pair of shoes in a specific color might be sold alongside a belt that exactly matches the color and texture of the shoes. These products are in the manufacturer's same family and meant to be bought as a set. Another example would be a furniture set (chairs, coffee table, couch, loveseat, ottoman, end table) that are all the same style but sold separately.

  • Accessory products. These products can't really be used on their own to any great extent. They're accessories to the main product but sold separately. Sometimes they're required to operate the product, and sometimes they're optional. If a watch takes a certain kind of battery that isn't included, the battery is an accessory. Similarly, a pump that blows up a water raft is an accessory. A warrantee for the product is also part of this category.

But are all those distinctions really necessary? Can't we lump all the various products groupings under one big umbrella term, like "related products," and be done? No. Doing so could be disastrous. What follows is a list of how to most effectively make use of each type of product relationship and where to use it.

Product Detail Page

The primary purpose of a product detail page is to convince the customer he really wants the current product. A secondary purpose is to make the user aware of other products he could buy instead, in case the current product isn't a great fit. There's a fine balance between these dual goals. On one hand, giving too much screen real estate and importance to the cross-sells diminishes the current product: If the user is always tempted to click on other products, he'll never buy anything. On the other hand, if the current product isn't right, we want the user to be able to easily view other products instead of abandoning his search.

Additionally, a product page should present products that will increase share of wallet if the user purchases the current product: products that are in the same family, are accessories to the product, and are complementary. A good product page clearly organizes these different types of related products and helps the user make clear choices.

In the case of the DVD example above, the page should focus primarily on information about that product. Placed prominently should be a list of accessories the user can check to easily add to the cart while he adds the current product. This might include longer or better cables and a two-year warranty. These products increase share of wallet if the user buys the current product. If there's a list of family products meant to go together, they'd appear here too. Best Buy does this for this DVD player.

If the user doesn't like the current product, the next list should provide alternative options, such as different DVD players that are priced higher or lower by the same or a different manufacturer. Look at this J&R page for a similar DVD player. On this page, accessories are placed on the right, and "similar products" ("competing products" in our terms) are listed at the bottom. Though at first glance the competing products are very low on the page, one must consider the page's primary purpose isn't to sell competing products but to sell the current product along with its accessories.

Although J&R puts the accessories in a list called "other J&R customers also bought these items," a more specific title might emphasize the relationship these products have to the main product. True, saying "other people did this" can be a strong selling point. To get both ideas across, this list could be titled, "J&R customers who bought this product also bought these accessories." This defines the list as accessories. A different list could be called "J&R customers also bought the following products"; it might contain a receiver or speaker set. This clearly implies a hierarchy of products and accessories: what other major purchase should I consider as a next step, and which minor purchases should be part of my buying decision for the current product?

JC Penney does a terrific job of merchandising complementary products in its clothing departments. In other departments, it recommends competing products. Which sort of cross-sells you offer really depends on the type of product you're selling and how users tend to buy those products. On this product page, for instance, JC Penney sells a "Lace Top and Cami Set." Its list of other products is a list of complementary products picked specifically to match the color and style. The products listed create an outfit. If the store had items in the same family as the current product, they should be listed here, too.

Shopping Cart Page

We also routinely see cross-sells on the shopping cart page. Many companies make a huge mistake by using the same technology employed on their product detail pages on the shopping cart pages. The purpose of the shopping cart page is to get the user to check out and to try to increase share of wallet by showing complementary products, family products, and accessories. Companies that don't distinguish these groupings make a colossal error on this page: they show competing products. The problem with this approach is you're making your buyer reconsider a purchase he already decided on. Display competing products at this stage, and you're practically begging the user to take the item out of his cart and continue exploring options. This isn't the behavior you want.

Moreover, this page should include items that can be easily added to the cart, as they're more or less impulse items. This implies accessories are more important than complementary items because accessories are part of the same purchase decision. They're linked to the product the user is already buying. Complementary products, on the hand, require a whole new purchase decision process. This could deter the user from his original purchase.

For any product listed on this page, the ideal behavior is the user will click "add to cart" and remain on the cart page. If the product must be configured or personalized (choose a size, color, etc.) before it can be added to the cart, the user is diverted from the checkout path.

Home Page

A personalized home page is a great place to present products to the user. However, the page must be aware of what the user has already bought, and the product recommendations shouldn't present competing items. Instead, the page should focus on family and complementary items. It should also present accessories to items that have already been bought.

Family vs. Complementary Products

Family products should be given more weight than other complementary products because they're meant to go with the current product. That's more important than products a merchandiser (or statistical analyzer) thinks should go with a product. Look at this folding bench at Hammacher Schlemmer. The "also bought" listing includes both family and complementary products. The first option is clearly in the same family, from the same manufacturer, and from the same line as the bench. The other two products are somewhat similar and complementary but not as closely matched as the first. Though it can be acceptable to simply lump these items together in the same list (placing the family items first, of course), a better design would specifically call these items out in their own list. This would make them stand out more and help induce a cross-sell much more effectively than simply lumping them into a list with more loosely related products.

Conclusion

Hopefully this column has helped define the different types of product groupings commonly used online today and where to best use them. Each situation is different, so take this column as building block to do your own testing and see what works in your environment.

Questions, comments? Let me know.

Until next time...

Jack

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ABOUT THE AUTHOR

Jack Aaronson

Jack Aaronson, CEO of The Aaronson Group and corporate lecturer, is a sought-after expert on enhanced user experiences, customer conversion, retention, and loyalty. If only a small percentage of people who arrive at your home page transact with your company (and even fewer return to transact again), Jack and his company can help. He also publishes a newsletter about multichannel marketing, personalization, user experience, and other related issues. He has keynoted most major marketing conferences around the world and regularly speaks at Shop.org and other major industry shows. You can learn more about Jack through his LinkedIn profile.

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