The upsell is something that every marketer knows about. It’s where you offer something extra that increases the cost of your product. This most commonly takes place after you have purchased the initial product. The general flow looks like this:
- You purchase the product
- You are sent to a page to purchase something else (often recurring) that adds extra benefit to the product
That’s what it looks like in its very simplest form. But it can get far more complicated and you can get more than one upsell being offered. In fact some IM products have a huge number of upsell options.
I have no problem with this if the services being sold meet two criteria:
- The initial purchase allows you to do everything that was claimed on the sales page
When you purchase a product based on what it can do on the sales page, only to find that to actually use it properly you need to buy one, two, three or sometimes more upsells. Then I find this goes against what I believe you should be doing as a marketer. You are no longer offering value, you are forcing your customer to pay more than they expected to use the initial product you sold them.
A real-world example of this which I find especially annoying is Ryan Air. If you purchase a Ryan Air ticket then if you want to check-in at the airport desk (as opposed to online) then you have to pay a not insignificant fee to do that.
Now I know that most people have internet these days, but some don’t and some people just aren’t comfortable with it. That means that if you want to check-in at the airport, which is in fact the place where you would expect to check-in (the online check-in is actually the convenience for those who use it) then you are having to pay extra just to use what you’ve already purchased.
For that reason I will never fly Ryan Air.
My second rule for upsells is:
- It is a valid addition to your main product and provides significant value
If you’re selling an upsell then it provides value to your customer and adds to the functionality, ease of use (or whatever it might be) of your initial product.
The most common of all upsells is features based. This is where you see a list of features and the cheaper version gives you only some and the more expensive version gives you access to more. But even some very successful businesses get this wrong.
Let’s take a look at a company that’s growing very fast in IM at the moment, LeadPages. Now I use LeadPages and I think they provide an excellent service. But…
…I think that they could significantly increase their revenue by properly upselling their two memberships. Here’s a screenshot from their current payment page.
There are two options, $37 per month and a $67 per month. But let’s look at the options you don’t get in the $37 per month variation. These are:
- A landing page course
- Access to the affiliate program
- Faster support
- Custom landing page templates
- Split testing
Now I can’t talk about whether the landing page course is any good or not, I haven’t gone through it (in fact I don’t even know where it is) but you get this once and you go through it (remember we are paying a monthly fee).
Access to the affiliate program is great if you have a list of people who are going to be interested in using this product and you can sell a good quantity. But… if you can sell a good quantity and don’t want to upgrade then the chances are LeadPages will let you promote anyway. I haven’t actually tested this and they may be very stringent but most companies aren’t if you approach them and say I can sell a few hundred licenses.
Faster support, okay this is a benefit. But if you read my article about support here, then my question would be… “Why do I need to pay more to get a quick support response, should I not get that anyway in my monthly fee?”
The custom landing page templates is going to have limited appeal because to create them within the LeadPages template structure you need to be a pretty accomplished coder. This isn’t beginning programming and… aren’t most of their customers joining because they don’t want to create their own templates!
Split testing, now this does have benefits and I like it, but it is still quite new and in beta testing.
I would suggest that there is actually comparatively little value for their average customer in the missing features. But when you then consider the price is an extra $30 per month! Well thats another $400 per year. I don’t see why most people would upgrade.
The majority are probably interested in the split testing and faster support, but is this really worth an extra $400 per year when you could use other services for the split testing. The landing page course may be nice to have but I can get one for a one-off fee rather than paying every month for it even when I haven’t read it for years.
Now I’ll probably be told that this works extremely well for them, and if it does then great. But to me this is a poorly structured upsell.
That doesn’t mean I don’t think the service is worth $67 per month. In fact I do. But I don’t think the additional features on the $67 per month package are worth anything like an extra $30 per month for most people.
But if we changed this around and priced the cheaper version at $54 per month, now the situation changes.
I’m now thinking, I want this product because it’s going to save me a lot of time. In fact most people who’ll pay $37 per month will also pay $54 per month for a service like this. It saves huge amounts of time every month.
But then I see for just another $12 per month, which is very little, I can get fast support and access split testing. That’s not much more for the benefit of being able to split test inside the same software as my landing pages without having to bother with another piece of software. The fast support would be great to have, although I’m still not sure why I get slow support on the cheaper package, and my mindset towards the landing page course, affiliate program and custom templates changes.
Instead of thinking… is this really worth $30 a month to me.
Because the split testing and fast support is definitely worth the extra $12 per month, I’m now thinking… a great bonus to get a landing page course, access to the affiliate program and if I want to, I can make my own templates.
What goes through your potential customers mind has changed and the extra features are now becoming good bonuses to have rather than expensive extras I may not use.
So when you’re structuring your upsells, think about them carefully from the perspective of you potential customer and what they want and how it will benefit them. This will increase your conversions and see you generating more revenue from the same traffic.