June 21, 2012
Simply put, most companies can’t merchandise every single product they have manually. Curating products for recommendations by hand when you’ve got 10,000 products, for example, is likely a waste of time and money.
But relying on algorithms alone to determine which items to upsell or downsell to a visitor can have a negative impact on sales, too. If you aren’t putting the most relevant products in front of your visitors, you can turn them off from a purchase entirely.
So it’s really art (manual curation) vs. science (algorithms) when it comes to figuring out which products to upsell or downsell, and at which point in the purchasing process.
Here’s the good news: There are a few steps you can take to make sure your upsell and downsell recommendations are more relevant to visitors:
1. Downsell at the right time. Merchandising should shift during the process of shopping and checking out to meet the needs of the visitor. Typically, downselling makes the most sense when a visitor is in the browsing stage. If a visitor is in browsing mode, showing product options that come in at a lower cost can be effective because some visitors are just looking for the best deal.
2. Upsell the right way. When a visitor is closer to the checkout or cart, your upselling efforts should take over. During the checkout flow, upsell by suggesting additional products that don’t require configuration. Example: Instead of trying to upsell a piece of clothing that requires shoppers to go to another product detail page to select a size, choose an accessory that doesn’t need sizing. That’ll ensure the visitor stays in the checkout flow, and the average order value can increase with just one click.
3. Balance algorithms with a human touch. Just putting products in front of your visitors isn’t enough, so relying on algorithms 100% to determine which items to display and when isn’t effective. Think about being in a high-end boutique where someone is literally helping you pick out the right things to put together. Emulating that experience is the ultimate goal, so start big.
Look at your best-selling products, focus your manual curation on those, and test to see how effective it is. You’ll learn what reduces returns, where you’re making money, and where it’s worth the investment to have a person curate which products are displayed. In the end, maybe you have five recommended products, two of which are being generated by the algorithm and three others that are added in by an actual merchandiser who is responsible for that category.
4. Segment your recommendations. From the segmentation side, one of the key things is figuring out what the right experience is for new vs. avid visitors. If someone is new to the site, they might come to a product that fits the bill—but is it the best version of what they’re looking for? In that case, showing the best-selling version of that product in a rec component on the product detail page is helpful. That way, they can see reviews of the product they're on and then click through to the bestseller, read your other customers’ rave reviews, and make the purchase.
For returning visitors, it’s best to show them what’s new, what they haven’t seen before, or what you’ve just added to your inventory.
5. Show your range. Some visitors want to buy the very best product you have with all of the best features, no matter the cost. Others want the best product for their money. If you have a visitor that’s going for the best value product, which may not have all of the bells and whistles of your top-of-the-line model, try upselling them on smaller items that add features the product they chose might not offer. It’s one way to increase the size of the sale before they check out, if they aren’t going to buy your big ticket item.
In the end, no customer or business is the same. There are an infinite number of permutations and iterations when it comes to testing which products to upsell or downsell. So focus on what makes sense at different phases of your conversion funnel in order to make sure you’re showing them the most relevant products for the purchase they’re making.
Brett Bair, Senior Director of Strategic Services, oversees the development and execution of all client services at Monetate. With his 15-year background in digital and multichannel marketing, at both new business startups and top ecommerce firms, he has a unique perspective on building results-driven teams designed to meet the needs of agile business.