When you think about customer support, you probably think about reducing churn, since happy customers stay with your company longer.
And it’s absolutely true that providing quality customer support is crucial if you want to retain your hard-won customers.
After all, 33% of Americans say that they’ll consider switching companies after just one instance of poor customer service, so you better get it right.
That being said, truly great customer support not only prevents you from losing money, it also generates revenue. Wait, what?
One word: upselling.
What Is Upselling?
You have probably heard the terms “upselling” and “cross-selling” before. But what exactly do they mean?
- Upselling is offering the customer a more expensive version of the same product. For example, if you buy a medium meal at McDonald’s, and the cashier asks you if you would like a large meal instead, that’s upselling.
- Cross-selling is offering the customer additional products. For example, if you buy a burger at McDonald’s and the cashier asks if you would like fries with it, that’s cross-selling.
SaaS companies can significantly increase their revenue and reach profitability much faster by upselling their customers.
“SaaS companies can accelerate time to profit by upselling and upgrading current customers, but only if it follows an exceptionally low-cost purchase process distinct from the new customer acquisition process,” says Joel York in his article “The Beauty of Upselling and Upgrades”.
“The chart above depicts the effect of upselling on the two uglier examples presented in the last SaaS metrics series installment where times to profit were 8 years and never, respectively,” he explains. “With upselling, the 8 year time to profit scenario is accelerated to just under 5 years, and never has been magically transformed to about 7.5 years”
How exactly does SaaS upselling look like? Usually, companies offer upgrades inside their apps, via email or via phone calls.
However, upselling through customer support is often overlooked, and mastering it provides an opportunity to increase your revenue.
Upsell Through Customer Support
Let’s make one thing clear: the primary purpose of the customer support team is to provide assistance to the customers, not to sell to them.
That being said, sometimes the customer might be open to an upgrade, in which case not offering it is a missed opportunity to increase revenue. But how should you go about it?
The #1 rule of upselling through customer support is this: only upsell happy customers.
Think about it. The last thing a frustrated customer wants is to get a sales pitch from a company that made them upset. At best, you will get an “Are you kidding me??” reaction. At worst, they will not only berate you, but also go on social media to vent. There’s no reason to take that risk.
Now, when it comes to the actual process of upselling, this is where helpdesk ticketing software comes into the picture. It boils down to keeping an eye out for an upsell opportunity throughout a regular customer support interaction:
Listen And Understand
Take time to understand what exactly is the customer struggling with.
You should pay attention to:
- The immediate problem. Why did they reach out to customer support?
- The broader context. What is the state of the customers business?
It’s important to read between the lines. What was left unsaid, but is still important?
Solve The Immediate Problem
You should solve the immediate problem as quickly as possible.
After all, that is why they contacted you, and you don’t want them to feel like you are wasting their time.
Offer An Upgrade
You should only offer an upgrade if you genuinely believe that the customer would benefit from it. It’s okay to ask them a few questions to determine that. This is where the understanding of the broader context comes into play.
A good way to see whether an upsell makes sense is to ask yourself whether you’d recommend it to a friend who was in the same situation as the customer.
For example, let’s say that you are selling email marketing software to ecommerce businesses.
Would you advise a friend who just launched their Shopify store to upgrade to a more expensive plan? Probably not.
However, if they had an established brand and were making a lot of sales, the advanced features could be really helpful to them.
Trying to upsell customers who wouldn’t benefit from an upgrade is not only unethical but is also a bad move purely from a business perspective.
People will quickly realize that they are not getting value out of it and either downgrade or leave altogether. And they will remember that you gave them a bad recommendation. They might even tell others about it.
That is why you should always have the customer’s best interests at heart. Sure, you want to make money, otherwise, you’d be running your company as a non-profit. But the only way to build a sustainable SaaS business is to keep your customers happy.
Explain To Your Customer Support Team That Upselling Is About Helping The Customer
Now, you might be excited about upselling through customer support, but getting your customer support team to actually do it might turn out to be a challenge. Why?
They are likely to be uncomfortable with the idea of selling to someone who reached out for help. It might feel somewhat sleazy.
That is understandable. We have all had unpleasant encounters with obnoxious salespeople. No one wants to be like them. It’s cringey.
This is why it’s important to explain what upselling is. It’s not about pushing a customer to buy something that they don’t need. It’s about offering them something that you believe will benefit them.
Moreover, the customers actually want to know about an upgrade that would help them.
For example, Mike Aoki, the president of Reflective Keynotes Inc. shared this experience:
“I have had the same home phone provider for 25 years. I subscribed to that same company’s Internet service 18 years ago. Three years ago, I became a mobile phone customer with that same firm. This spring, I saw a flier in my mailbox advertising that same company’s TV service. So, I called and switched from cable TV to Internet TV. I am glad I did, since bundling all of my telecom/TV services saves over $1,000 a year versus using different providers.
I realized I could have saved $2,000 since this TV service’s debut two years ago. I was upset! Even though I had called that company several times to ask questions about my phone bill or make adjustments to my long-distance plan, their agents had never taken the time to explain their TV service to me properly.”
This was a cross-selling failure, but the point is that the company did the customer a disservice by not making the offer.
Sure, selling might feel awkward, so it’s tempting to avoid it. However, if you believe that the customer would benefit from an upgrade, is it ethical not to suggest it?
After all, you know your product best, so you should let people know how it might help them.
Take time to discuss all of this with your customer support team. They will have a much easier time with upselling once they realize that it’s all about helping the customer.
After all, when you look at it that way, it’s really not much different from what they already do at their job day in and day out.
Teach Your Customer Support Team How To Sell
You can’t expect someone who has no experience in sales to be good at it.
Want your customer support team to upsell well? Then it’s your responsibility to provide them with sales training. Make sure that they have at least the basic understanding of how to sell your product. But what does “the basic understanding” actually mean?
Here are the three key concepts that you should cover:
There’s a joke in sales that goes like this: “What is everyone’s favorite radio station? WII FM!”.
WII FM stands for “What’s in it for me?”. It’s a reminder that people don’t care about you and they don’t care about your product. They want to know what’s in it for them.
That is why you should focus on how the upgrade will make the customer’s life better.
Features Vs. Benefits
You must understand the difference between the features of the product and the benefits of the product if you want to be effective at selling.
- A feature is a function of the product. For example, MeetEdgar is a social media scheduling tool that has features like unlimited content library, bulk uploading and editing, a browser extension, and more.
- A benefit is the value that the product provides. For example, MeetEdgar helps their customers save time (or, as they say, “ takes the time-suck out of social media”).
It may seem that people want the features, but they actually want the benefits that the product will provide. That is why you should always sell on benefits.
What value will the customers get from the upgrade? Okay, there’s this additional feature, but what benefit does it provide? Again, what’s in it for them?
Closing The Sale
Once you made your sales pitch, you need to ask the customer to make the purchase. Do they want to upgrade now? Yes? Then help them navigate the process.
This might feel awkward at first. That is completely normal. It takes practice to get used to selling. But you need to remember that you are trying to help them. Don’t let the awkwardness stop you.
Of course, not all customers that you offer an upgrade to will want it. In fact, most of them probably won’t.
Don’t take rejection personally, though. It’s an inevitable part of the process. You made an offer. They weren’t interested. The world didn’t end. There’s nothing to worry about.
Actually, rejection in sales is similar to angry customers in customer support, it stings at first, but eventually you get desensitized to it. Then you wonder why it used to upset you so much.
What Matters The Most In Sales?
One could spend a lifetime studying sales. There are countless books, courses, and seminars on the topic. This might seem overwhelming to a person who is new to it.
However, ultimately sales boil down to three things:
- Understanding what people want.
- Explaining to them how your product will help them get it
- Asking them to buy it.
Pretty straightforward, right? But the simplicity is deceptive. You may think that you know what people want, but you might be wrong. Answers that seem obvious are rarely correct. You need to dig deep to get to the bottom of what makes a person spend their hard-earned money.
Make sure that your customer service representatives know who your customers are, what they want, and how your product helps them achieve that. What is the main benefit that your product provides?
For example, ConvertKit sells email marketing software, but what their customers really want is to “make a living doing work they love,” and ConvertKit’s mission is to help creators earn a living online.
The better you understand your customers, the better you will be at selling to them. You need to speak their language. What’s important to them?
Luckily, customer service representatives tend to be empathetic people, so sales should come easily to them once they make the shift from the “selling” mindset to the “helping” mindset.
Neil Patel, the co-founder of KissMetrics and Crazy Egg, said that “In the SaaS world, the path to riches and prosperity is through successful upselling.”
And why wouldn’t you upsell? You have a great product that can make your customer’s life better. Don’t you have a duty to let them know about an upgrade that would serve them well?
So train your customer support team to notice when a customer could benefit from an upgrade and then offer it to them in a helpful way.
Those upgrades will add up to a significant amount of money in the long run.