Upselling is one of the most powerful marketing tools available. In Direct Response marketing we see this most often as what gets mentioned 8 minutes into an infomercial. When used to overcome objections with a solution based on value, we can have long-lasting wins for ourselves around things like AOV, LTV, Brand Positioning, & Stickiness. Let's dive deep into how to best use this tool to fundamentally change your business.
What is a Rebuttal Upsell, What is a Rebupsell?
When we have potential customers show interest, but they don't convert, we are often faced with an objection. The most common way that digital marketers overcome any objection, is to both retarget heavily to be top of mind, & offer lower prices. Because of the impersonal nature of digital marketing, we cannot get feedback on the "Why" when it comes to the lack of a sale. Marketers have been trained to "get the sale, and get credit for it". This reinforces the devaluing of a brand to solve for Mazlov's hierarchy of Physiological Needs, to the meet necessity of food, water, and shelter for survival. In modern society, this concept translates to money.
A RebUpsell is often 1 of 2 types of offers:
1st, is a bundle that pairs vertically integrated product offerings to "win the sale" by creating a complimentary customer journey in the initial transaction.
2nd, is a "Buy More Save More" offer where someone can get a 'discount' by paying more.
How does the Rebupsell work?
A RebUpsell meets "luxury needs". Luxury does not only mean quality and high comfort but also personal fulfillment and personalized experiences take priority. By giving more value, for a higher price, we can accomplish things far more impactful than getting a good ROAS to make a Facebook report look good, and can instead we can build a brand.
Economically, a RebUpsell is most often set at a price point where the AOV is competitive with the LTV of a typical customer journey. Because CPA rarely rises linearly with AOV, this creates a greater profit margin per sale. Because this is built around a 'discount on perceived value', we aren't selling each product at the full market rate.
This "loss" in revenue, is offset by 2 factors.
1st, the CPA of each transaction to sell each item in the bundle, is greater than the COGS of the discount... basically, giving something away to charge more, costs less than selling each item in the bundle.
2nd, bundle buyers are more likely to buy a 2nd time, and the LTV for our typical customer journey can easily rise by 50% to 200% or more.
Psychologically, a RebUpsell also gets a customer commitment in a far more powerful way than a one-off purchase. Simply put, bundles convince consumers they're getting a bargain. Additionally, when more products are in a customer's hand, and this is paired with more money out of their pocket, brand loyalty is tangentially created.
What is the best Facebook Ads retargeting strategy?
When a customer shows interest in your hero product, but they don't buy, we can retarget them with a bundle offer for a greater AOV. This not only addresses the issue of added costs in retargeting marketing, but also creates a positioning conversation with the primary offer in a non-competitive way.
The 2 GOLDEN RULES of the RebUpsell:
1: Avoid mixing a cheap item and an expensive item and simply promote the package.
2: If you are mixing products with different values, establish the value of the individual items first, particularly the most expensive.
Take a lesson from infomercial producers and emphasize the additive nature of bonus items.
Focus on non-price attributes of the product (e.g., durability or comfort) – the researchers say this will reduce the devaluation effect from mixed-value items.
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