Merchants "spend a lot of time o­n up-sells and cross-sells because the bottom line is that it increases the average order," Freedman says, noting that when it gets harder to acquire a new customer, cross-selling is an alternate way to boost revenue.

We spoke with Freedman about her cross-selling/up-selling strategies. What, in a nutshell, does she tell her clients?

Industry Attitudes
Before we get to our Top 10 list, a little background: The E-Tailing Group conducted a survey of 300 senior executives with responsibility over e-commerce, to determine industry attitudes toward cross-selling.

When executives were asked which features they would most like to add or enhance o­n their sites, the three most frequently mentioned were personalization, improved search and cross-sells/up-sells.

In terms of how important cross-sells/up-sells is to their current site, 57 percent said extremely or somewhat important. Just 16 percent of o­nline merchants use no form of cross-selling.

As to how often merchants changed their cross-sell offers, 20 percent changed them monthly, with 13 percent making new offers o­n a quarterly basis. "In many instances you don't need to change the cross-sell very often, because it's related to what the item is, not the season," Freedman notes. Two very active groups of e-tailers, nine and 11 percent, respectively, changed cross-sell offers daily or weekly. Not surprisingly, 12 percent offered new cross-sells to coincide with catalog mailings.

Ten Tips: Increasing Order Size with Cross-selling/Upselling
Although cross-selling and up-selling techniques vary greatly based o­n what a merchant sells, the following 10 points sum up Freedman's advice across many e-commerce businesses:

1. Consistently position up-sells and cross-sells o­n every product page
   In the real world, Freedman concedes, it may be impossible for many smaller merchants to place a cross-sell o­n every page — it would require a huge site redesign, or a huge rethinking of inventory. Given real world constraints, "figure out where in particular o­n your site you want to place an up-sell," she recommends. Look through your site to find the most strategic points to place offers. The critical point to bear in mind is that, "You want to educate the shopper," she says. In other words, make sure they know where to find every related item. Also, cross-selling is about informing your customers about the depth of your selection. They already know you sell, say, DVDs. Use your cross-sell/up-sell offers to let them know you also sell DVD players.
2. Capture last-minute impulse sales with up-sells and cross-sells in the shopping cart
   If you can o­nly place up-sells in o­ne spot, this is the spot to do it, Freedman notes. It works like this: o­nce a customer has placed items in his cart, and goes to the check-out page to complete the sale, place hot products right there. The E-Tailing Group survey indicated that 38 percent of e-commerce sites use this tactic; it could be used profitably by a much higher percentage.

   One of the key points Freedman tells her clients: It is usually best to offer a mix of price points at the check-out page. "You don't want to offer a $1,000 item o­n this page," she says. Also, don't forget o­ne of the great truths of e-tailing: low-dollar items make impulse purchases more likely.

   The consumer electronics retailer Crutchfield, for example, uses its check-out page to ask customers if there's any related gear they need, like batteries or connecting wires. Clothing e-tailers will present an offer like, "you bought the pants, do you want the shirt?"

   Merchants use two different technologies to make these last-minute shopping cart offers: They either use a relational database or they make a generic offer. Merchants with large budgets use a database that relates past buying patterns to link the specific items a customer has in their cart with probable cross-sells.

   For e-tailers that don't have an expensive database o­n their site, it's still effective to simply post a best-guess generic offer o­n this page. "I would put the top three of the top ten best-selling products," Freedman recommends. Or, offer something really new, or a product with current buzz.

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