Once the norm in retail employee training and perfected in the quick-serve restaurant industry, upselling isn’t always witnessed in retail environments, including convenience stores. Today we’re discussing the ins and outs of upselling in the retail environment, specifically in convenience stores.
Cross-Selling vs. Upselling
Cross-selling and upselling are often incorrectly viewed as being equal. However, cross-selling is selling an extra item that complements the product the customer is buying, such as a drink with a slice of pizza or a snack with a soda.
On the other hand, upselling is getting the customer to change out their intended purchase for a more profitable one, such as suggesting the purchase a 32-oz. drink instead of the 16-oz. version or pointing out the larger bag of snacks for only cents more.
When done correctly, these practices are not only an effective way to increase sales, but they’re also helpful to the customer. The salesperson is pointing out items they wouldn’t have known about, which boosts their satisfaction. But experts point out that there’s a fine line between upselling and being pushy – it needs to occur naturally and seem more like a suggestion than a sales pitch.
The Convenience Store’s Dilemma
While many convenience stores don’t educate their employees in these sales techniques, the need for them still exists. If an employee can upsell every fourth customer, it will provide a major boost to the revenue of the business. Its success lies in recognizing that the short contact the customer has with the employee is actually an opportunity.
A convenience store is a different environment, where the customer may be a bit more open to a friendly recommendation than if they were purchasing the same thing at the gas station down the road. But it doesn’t take away from the fact that they’re able to upsell plenty of items successfully.
The Tech Answer to Upselling
The trend in retail is moving toward using technology to perform upselling tasks, and that’s an area where convenience stores have a real chance to shine. As consumers become more comfortable with technology, in a convenience store it can be the driver for more impulse purchases.
Next generation point-of-sale (POS) terminals are connected with analytics that compile sales data to improve on tasks such as upselling. There are processes that help determine the upselling possibilities for various items, and when the best time is to promote them.
Many companies in the quick-service industry are using this kind of big data, combining sales information with related information such as weather, time, and traffic patterns. It’s implementing what many experienced retailers have always done, which is to look around inside and outside of the store for additional opportunities.
For instance, a lot of convenience store managers keep a stand of cheap umbrellas near the counter in case a storm strikes. But if the data is indicating that the weather will be calm, wouldn’t that space be better utilized for something else?
It Still Comes Down to Human Interaction
Successful upselling may still come down to an interaction between two people. Unless we eventually see completely self-checkout convenience stores, you’re still going to have two people involved in the transaction, the customer and the clerk. Even when using the best technology, it’s difficult to do better than a helpful employee making a sales recommendation.
Wondering how your employees are handling upselling at your business? Our mystery shopping programs will clearly reveal if your employees’ techniques and give you the data to provide customized coaching. Call RBG today and we’ll show you how.
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