Cross-Selling and Upselling Made Easy: The Power of CPQ

The benefits of upselling and cross-selling are clear as day.

Assuming you’re selling them something they actually need, it’s the perfect way to add more value to your customers’ purchases. They’ll get extra benefits from using your product. And they’ll solve problems they might not even know they had.

For your business, the data is also clear:

• You’re 60%-70% more likely to sell an existing customer than close a new one.
• 72% of sellers make ~30% of their revenue from these tactics.
• Successful upsells and cross-sells boost CLV by 20%-40%.

Even if you have the system down, it’s hard to win new business. You have to market to new people, make them feel comfortable enough with your brand to spend their money, and create urgency around doing so.

If that’s the only way you’re adding new revenue to your top line, you’re missing out. Big time.

And as a Sales Ops leader, you need to change that.

Upsells and cross-sells are low-hanging fruit for sales success…

Your current customers already know and trust your brand. They’ve seen the value you provide and are willing to spend money with you. Now, it’s up to you to leverage that trust into additional revenue streams.

If you can accomplish that, you’re at a tremendous advantage. The more customers rely on your product ecosystem, the higher their switching costs are and the less likely they are to leave. And, by selling more products to your existing customers, that’s exactly what you’re doing.

Not to mention, upselling and cross-selling are much more cost-effective than acquiring new customers. You don’t have to spend much on marketing and advertising to convince your current customers to buy more.

Plus, you already have the customer data and insights necessary to tailor your offerings specifically to their needs.

…but succeeding with upselling and cross-selling isn’t so easy.

It requires you to: 

• Understand your customers’ needs and pain points. Without this knowledge, you won’t know which products or services to offer as upsells and cross-sells.
• Align your offerings with what they currently use. Your recommendations need to complement their initial purchase and provide value that they otherwise wouldn’t have had.
• Make the buying process seamless and convenient. If it’s too difficult for customers to carry out the transaction, they’ll skip it. If you offer a bad experience here, it could even cause them to reevaluate their relationship with the product they’re currently using.

There are also challenges your sales team will face when trying to execute upselling and cross-selling strategies, the most prevalent one being that it’s difficult for them to keep track of all the products and solutions your company offers, and how they’re interrelated.

The role of CPQ in upselling and cross-selling

Upselling and cross-selling are two of the best ways to grow revenue. And facilitating them only requires a few small changes to your current sales workflow. All you need is a configure, price, quote (CPQ) tool.

Product configuration

CPQ eliminates the challenges of traditional product configuration by using predefined rules that guide users through product customization. Every step of the way, the system enforces these rules, so the options presented to the seller are always compatible and compliant with your pricing model.

Let’s say you’re configuring a tech product for a customer. Based on your pre-programmed product rules, it’ll automatically suggest compatible add-ons, upgrades, and additional features based on the initial selections.

Pricing and discounting

CPQ makes pricing and discounting a piece of cake. On the backend, you configure your pricing mode, including contingencies, discounts, and promotions.

These include:

• Volume discounts (the more products a customer buys, the lower the price per unit).
• Bundled pricing (offering complementary products at a discounted rate when someone buys together).
• Promotions and coupons (limited-time offers or special deals for specific customers)
• Customer- or segment-specific pricing (offering different prices to different types of customers, such as small businesses vs. large enterprises).

Your sales rep would normally have to remember these all or spend time looking them up for each sale. With CPQ, you enter the rules once and it applies them forever (or until you change them).

It also automates pricing calculations, which guarantees accurate pricing and all but eliminates the risk of human pricing errors.

As you add additional products or make changes, you’ll see the impact of those changes on the total price as well, so the customer knows exactly what they’re getting and at what cost.

Recommendation engine

With intelligent configuration, your CPQ can use customer data and contextual info to offer product recs tailored to each customer’s requirements.

For example, if one of your SMB customers bought software for their small team but has since expanded their operations, it might suggest a higher tier plan that could scale with their needs.

The best thing about dynamic CPQ options is that they adapt in real time as the customer selects products and leaves feedback.

Guided selling

Guided selling is one of the main features that make CPQ software so effective.

As your sales rep is configuring a deal, a CPQ system with guided selling capabilities will present them with specific questions to ask their customer. This helps them identify pain points and customer needs, then upsell a product that meets those demands.

For example, if your customer mentions they need additional storage space for their current product, the guided selling tool might suggest an upgraded version that spports it in addition to the standard storage add-on.

From there, the rep can ask additional questions to discover what other changes have happened in their business. That way, they can figure out whether that upgraded product version would be better than simply adding more storage.

Optimizing cross-selling and upselling with CPQ

Of course, CPQ won’t do all the work for you. It just enables the process. To win at expanding your current accounts and adding value to the deals in your pipeline, you need to consider a few other factors.

Data analysis to identify new opportunities

Although the chance to upsell or cross-sell somebody will pop up sporadically, it’s best if you approach this strategically.

Use your business and customer data to determine which products or solutions are most frequently purchased together, then focus on selling those bundles. For your reps, these offers should be second nature.

You can get more granular by looking at previous orders, customer profiles, and personas to find out who bought what. You can also use this data to determine the ideal target audience for your cross-selling efforts.

Hint: You can find most of this data already within your CPQ platform.

Personalized offers

When you’re actively selling to a customer, you have to package your offer in such a way that it addresses their specific needs. Personalization is key to making your company stand out, and CPQ can help you deliver.

Even if it’s a standard offer that you give to every similar customer, make sure you reiterate their specific needs and frame your offer as a solution to their specific problem.

Your CPQ can help you with this by offering dynamic recommendations based on previous selections (for new customers) or past orders (for current ones).

Sales training and enablement

To truly maximize your ROI from CPQ, you have to give your sales team the knowledge and resources to upsell and cross-sell effectively.

• Training materials: Make sure your reps are well-versed in your product catalog and the different use cases for each product or solution. Product knowledge will help them naturally spot opportunities to upsell or cross-sell and offer them instinctively.
• Sales playbooks: Work with your marketing and sales teams to develop specific plays for upselling and cross-selling. Include best practices, proper messaging, and strategies for different customer scenarios.
• CPQ training: Your sales reps also need to be trained on how the CPQ system works, particularly how its dynamic recommendation features work. They should know how to leverage the system’s capabilities to maximize upselling and cross-selling opportunities.

Continuous optimization

To truly excel at upselling and cross-selling with CPQ, you have to continuously optimize your processes.

Use your CPQ data and customer feedback to constantly refine your recommendations and sales strategies. And of course, keep track of which offers work best for different types of customers or scenarios.

Upselling and cross-selling success stories

To help you truly grasp how effective CPQ can be at upselling and cross-selling, let’s take a look at a few examples.

Yotpo x DealHub CPQ

Yotpo is a SaaS company that faced huge challenges with complex SKU selection and an inefficient quoting process. It hindered their ability to upsell and cross-sell effectively.

By implementing a CPQ solution from DealHub, they streamlined their sales processes and reduced quote turnaround times to under 8 minutes. The CPQ system’s dynamic pricing feature enabled the sales team to respond quickly to market shifts, leading to larger deal sizes and improved win rates.

This contributed to a noticeable increase in revenue, as the system encouraged reps to offer premium products and relevant add-ons more efficiently.

Salesforce CPQ for SaaS companies

Salesforce CPQ has been instrumental for SaaS companies that want to maximize their upselling and cross-selling opportunities. It lets sales teams to add additional products and services to quotes quickly, and its bundle pricing feature allows businesses to offer multiple products at a discounted rate, which incentivizes customers to purchase more.

Salesforce CPQ also has dynamic pricing and guided selling features, which have been crucial for its users with complex pricing models. It helps reps figure out the right offers to make and which products to add on based on customers’ needs, preferences, and budgets.

Drive sales growth with CPQ software.

For upselling and cross-selling (among dozens of other sales processes), CPQ software is the must-have tool. It streamlines your workflow, uses smart algorithms to help you personalize offers, and gives you everything you need to sell more efficiently.

If your current system doesn’t support dynamic product recs, guided selling, or any of the features we’ve mentioned, it’s time for an upgrade. And for that, we’ve got plenty of resources.

Start your search for the perfect CPQ system by reading our CPQ reviews and product comparison pages. Also check out my smart tips for selecting CPQ software.