Are you leaving money on the table? Read on and watch this quick video to find out.
I often see clients being afraid of the upsell. They get a bit uncomfortable with it at a subconscious level. Watch the quick video below to see how the upsell and the slack adjuster can help your business.
Brands Built on the Upsell
The things is, if you look at big organizations like McDonalds, that’s really where their profit comes in. They’ve built their business on the upsell. They’re not really making that much money on the initial burger. But I think everyone would have heard this, “Do you want fries with that?” And it’s the most famous example of an upsell and no one really begrudges McDonalds for doing it, so just think about it with your business. Often, things that you’re worried about as a subconscious level, your client or prospect is not necessarily even worried about.
Ignore your own Personal Thoughts, Opinions and Biases
I used to work with Mal Emery and he’d say, “Don’t let your own thoughts, opinions and biases get in the way between you and a sale.”
So if there’s one thing I’ve learn’t over the years it’s to not be afraid of the upsell.
There’s science to back it up too. You see, when someone buys or makes a purchase, dopamine, is released in their brain.
Dopamine is also released with kissing. (Would you believe this guy’s name is Greg also?). He’s from the cow downy fair.
. . . and dopamine is also released in the brain with cocaine ingestion.
So that’s when dopamine’s released in the brain. And when dopamine’s released in the brain, the more likely that you’re going to want to keep repeating that activity.
Example of how to 80/20 your upsell Maths
But the reason why we want to upsell, comes back to the 80/20 principle. I think most people should be familiar with the 80/20 principal so I won’t spend much time on it, but it’s just so crucial and one of the biggest things that has ever impacted our business, so it’s worth mentioning how this relates back to upsells.
And what it’s talking about is:
– what’s the 20% of things that you can do that will give you the 80% of results?
– Or who are the 20% of customers that are going to give you the 80% of the results?
80/20 is also fractal, meaning that within an 80/20 there’s another 80/20. So what’s the 4% of things that are going to give you the 64% of results? Or the 4% of customers that are going to give you 64% of the money, that kind of thing.
So in this example, if we assume we have 2,500 customers. 2,000 of them will pay a low ticket item like $7. Four hundred of them will pay a bigger ticket item like $47, and 80 of them would pay something like $497. And for a lot of marketers, that is where they would stop because they’d think at a subconscious level, “Is it worth more than that? My market doesn’t want to spend more than that. My market wants cheap stuff.” I can see people nodding and a lot of people can relate to that and we hear it over and over again as we’re working with business owners.
The crucial Upsell step – The “Slack Adjuster”
But I’ll show you how much money you’re leaving on the table if you don’t keep keeping going with your 80/20.
Because out of our 2,500 customers, 16 statistically would pay $12,000, 3 of them would pay $25,000 and 1 will pay $100,000 for you just to do everything for them. What this shows you is that you need that ‘slack adjuster’, that big ticket item. Yet, most business owners leave out the slack adjuster.
Think about this: If you can add in a slack adjuster, what does it mean to your customer acquisition costs?
Even if you’re not breaking even on day one – If you’ve got big ticket items that you know statistically out of these next thousand people coming, so many are going to buy at this level, so many are going to buy at that level, so many are going to buy at that level, and so many are going to buy at that level, then it doesn’t really matter. You can get to the point where your funnel on day one is just recouping 50% of your cost or 60% of your cost. Most people have funnels that really lose money on day one, so they spend money on advertising and then they’re hoping to get it back over the next 40, 60, 90 days because they’ve looked at the maths.
We found by even just setting up a basic funnel that gives you at least 50% of your money back, what it allows you to do is scale so much faster. So you’ll build your list of clients and prospects so much faster than if you don’t get any of your money back at all on day one. Yes, there’s some businesses that this is not appropriate for, but as a general rule it works great.
If you need some inspiration, a very common slack adjuster is, “Do you need a hand with that? Do you need help?” and then just touch base with people and be genuine. I love Ari Galper’s take on being genuine in sales, which is why I think we get on so well. He talks about looking at it from the point of view of “Are we a fit? ‘Can I help you and can you help me?” If there’s a fit then do some business together and if there’s not clear win/win scenario, then don’t do business together.
So use integrity behind it, but even some just adding something as as simple “Do you need a hand with that? Do you need help?” at the end of your funnels will prompt people to reach out and interact with you and your business and kick off genuine conversations to see whether you can help them out.
Final Thoughts for you
Don’t be afraid of losing money on the front end, if you work your maths so that you will make it back on the backend. Use a slack adjuster to make your maths work. Look at how other big brands have built their businesses on upsells. Don’t let your own thoughts, opinions and biases get in the way between you and a sale. Always be authentic and offer a slack adjuster that works for you and your clients so it’s a win/win type offer.
I’d love to get your comment below – are you using upsells with success? Do you use a slack adjuster in your business now? or are you leaving money on the table and could be adding upsells or slack adjusters?