Cross-Store Selling and How It Works in 2022

Cross-Store Selling and How It Works in 2022

What you should know about cross-store selling. Top 7 ecommerce strategies. Cross-selling vs upselling. Omni-channel shopping experience. Pros and cons of cross-store selling

How can you expand your business when your product range is limited? The answer is cross-store selling.

What is cross-store selling?

Cross-store selling means that when offering goods to your customers, you rely not solely on your own product range but that of another online store. It is a partnership that enables brands to sell more with minimum risks and investments.

For example, if you sell trendy clothes, you can team up with a brand that manufactures bags and accessories. If you sell coffee machines, you may partner with a company that sells coffee. When clients of these online stores purchase bags or coffee, they see your product recommendations. Many entrepreneurs call this method the best way to increase online sales because it enables them to expand their customer base cheaply and easily.

Q. Do I need to stop selling on my website those products that I give to my partner store?
A. No, you can keep selling these items in your own store at the same price.

Difference between cross-store selling, cross-selling, upselling Cross-selling is not the same as cross-store selling, although the two are connected.

Cross-selling is a marketing technique that enables you to increase website sales by offering complementary products. When a person adds an item to their shopping cart, they expect this product to fix some of their pain points. A complementary product should let them meet their needs even more efficiently.

A brand can produce these complementary goods or sell them cross-store, getting them from other companies to expand its product range. In short, cross-selling is a marketing technique; cross-store selling is a partnership between brands.

More on cross-selling

The customer might be unaware of the existence of the additional product. By recommending this item to your clients, you educate your audience and prove that you take care of them. The probability of selling a product to a new prospect falls within the range of 5% to 20%. Meanwhile, if you target your already existing clients with cross-selling, this probability can reach 60% or even 70%.

In a brick-and-mortar store, an assistant can approach the client, saying “Would you like to check what else we might have for you?”. In an online store, you can’t contact the buyer physically — but you can show a section called “You may also like” or “Frequently bought together”. Instead of hand-picking the items to recommend manually, you should let your store’s algorithms select opportune products automatically.

Here are the three most popular types of products that cross-sell:

  • Related products. If you buy tea, then, sugar, milk, and cookies can act as related items.
  • Complementary products. When you purchase nail polish, a nail polish dryer or remover can become a perfect complementary product.
  • Services. You may offer a warranty or a protection plan for your product. You can help customers set up the product in their homes or offices.

It makes sense to offer cross-selling products to clients in two locations: on product pages and during checkout. In the first case, the ideal price of the complementary product should be 10% to 50% of the main item’s cost. If possible, offer unique goods that a consumer can’t get anywhere else.

When choosing goods that you could offer to your clients at the checkout stage, think of supermarkets. At the checkout line, you can purchase sweets, chewing gum, and magazines. Complementary goods in an online store should be just as small and cheap (such as batteries, earbuds, etc). Consumers might be able to discover cross-selling items after they hit the Add to Cart button, on the cart page, or within the checkout flow. To find out which of these three options works best for you, conduct A/B testing.

Upselling as a marketing technique

To boost your online sales, you may resort not only to cross-selling but to upselling as well. The latter technique was invented to convince consumers to purchase more expensive products. Your task is to:

  1. Highlight the benefits of the premium options, compared to cheaper alternatives.
  2. Convince the client that right now, they can get the premium option under very favorable conditions.

When upselling, you offer an upgraded version of the same product but not an alternative product.

Q. Can I combine cross-selling with upselling?
A. When trying to cross-sell, you shouldn’t recommend to consumers products that cost more than the items that they initially chose. Besides, you shouldn’t try to offer them complementary products and more premium products at once. It would be wiser to test each of these techniques separately and find out which one works best for each type of client.

Examples of upselling and cross-selling

This table with real-life examples should help you understand the difference between upselling and cross-selling.

The product that the customer wanted to buyUpsellingCross-selling
iPhone 13iPhone 13 ProiPhone 13 and accessories for it
A small bottle of smoothieA large bottle of smoothie or a pack of 6 small bottlesA small bottle of smoothie and a snack bar
An armchairA sofaAn armchair and a coffee table

How does cross-store selling work?

Cross-store selling is based on a simple and transparent scheme.

  • Brands with similar concepts enter into a partnership to sell complementary products through each other’s storefronts.
  • Both vendors promote their partner’s goods just as actively as their own ones.
  • Brands boost each other’s profits and share customer data, but only manage their own inventory.

Each brand acts as a retailer and supplier simultaneously.

Q. Do I need to share a part of my profit with my partner brand?
A. Yes. Brands share the profit made by selling their partner’s products with their partners. Cross-store selling is considered one of the best ways to expand your business because it allows you to minimize your expenses, lower risks while boosting your web sales, and gain new sales channels with the help of other brands. Below, we’ll explain these benefits in detail.

Increase sales at no extra cost

One of the biggest challenges related to setting up an online store is attracting your first customers. At this stage, your client acquisition cost will be at its highest.

To reduce it, you can team up with a similar brand and expose your products on its storefront. You won’t need to pay for marketing because your partner will do it. You’ll get your first customers for free — and then, you’ll focus on promoting your own online store.

Grow your business at less risk

Brands that don’t focus on growth begin to stagnate. However, most business growth strategies require large expenses. Cross-store selling enables you to achieve impressive results with minimum investment. That’s why suppliers and retailers call cross-store selling the best way to grow ecommerce business.

How it works for suppliers

When looking for the best way to expand their business, suppliers can:

  • determine the demographics of the audience they’d love to target,
  • launch advertising campaigns targeted at people with these demographics,
  • make a profit and expand the customer base — or find out that this audience fails to engage with products and lose money.

Instead of sticking to this scheme, it would be wiser to team up with a store that is focused on customers with the desired characteristics. Suppliers can offer their products to this business and measure the demand. Once they realize there is a market niche for their goods, they can start attracting clients to their own store.

How it works for retailers

A retailer that wants to grow their business needs to regularly update the product range. If consumers know that this store systematically offers new collections, they will be curious to check its website every few weeks.

Thanks to cross-store selling, retailers can offer new items to their audience without investing in manufacturing, purchasing needed goods in bulk, or managing inventory.

It’s a great opportunity to test whether clients love this type of product. If they do, a retailer can start offering such items in their shop or create similar ones from scratch.

Gain new sales channels through other brands

The store that you team up with has its customer base. It has been building this base for several years, through various channels. Now, you can get access to these customers without making identical efforts yourself.

Moreover, as a consumer makes a cross-store purchase, both stores involved will get access to the CRM data about this person. You’ll be able to leverage the data that your partner has collected, and they in turn will benefit from your statistics.

You’ll get to know which marketing techniques your partner used to attract this client. You can rely on this knowledge to make this person your repeat customer.

Work on your brand visibility

The more visible your brand is, the more efficiently you’ll increase your online sales. Cross-store selling is known as the best way to grow your business because it enables you to expose your brand to consumers that otherwise won’t be aware of its existence.

These people know and trust the store that you collaborate with. By teaming up with you, this brand confirms that you’re a reputable partner and your products are worth paying attention to.

Offer a whole new omni-channel shopping experience

The term “omnichannel retail” means that consumers can order everything they need from one website or app. The most obvious example is marketplaces.

Here is what you can do to benefit from cross-channel marketing:

  • Supply your products to platforms where your target audience buys goods and services regularly.
  • Collaborate with brands that sell these products on the same platform, especially when their products complement yours.
  • Position your products at every stage along the customer’s journey.

Such an approach lets you boost your exposure much more than if customers could only reach you through your website. Consumers will appreciate it if you help them save time and effort. Instead of browsing multiple stores, they will be able to find all the necessary products in one place. It makes them more likely to make a purchase and come back over time.

Q. Does cross-store selling have any drawbacks?
A. Alas, it does. It might disrupt the customer experience. A person might get used to purchasing your goods or services in a third-party store. To convince consumers to use your website, you can introduce a loyalty program, offer discounts or rewards in exchange for product reviews, as well as provide additional services (such as a VR fitting room).

Top 7 strategies to increase your sales online

Here, we’ll list the most efficient strategies that should enable you to boost website sales in nearly any ecommerce niche.

Always put your customer’s experience first

The biggest mistake would be to offer those products that you would like to sell the most. That might lead to your customers’ anger or frustration. Instead, you should think of what your consumers genuinely need when they order a specific product. They should feel they’re getting a better deal.

For instance, if a person buys a gadget that lacks a power cord, it would be reasonable to cross-sell this cord. Or, if they have added a high-end product to their cart, you may offer a protection plan for it.

If you offer an irrelevant item to the customer, they might leave without finalizing the purchase.

Make behavior segmentation

Analyze your clients’ behavior patterns on your website. Group your clients depending on how much time they spend in your store, which pages they visit, and which products they are interested in. Fine-tune your cross-store selling techniques and the range of recommended products to match the needs of each group.

Start with your best-selling items

If most of your clients appreciate a certain product, the client who hasn’t yet completed their purchase will be more likely to add it to their cart spontaneously. When they click on this product’s icon, they will discover other people’s high ratings and appreciative reviews about it. That will be a perfect motivation for the purchase.

Offer free shipping to encourage customers

That’s one of the oldest and the most efficient tips on how to boost sales ecommerce. Tell your clients that they won’t need to pay for shipping if the cost of their order exceeds a certain amount. 65% of consumers check free shipping thresholds before adding goods to their carts.

Bundle your items

Bundling means that you pack two or more items together. It might be a shampoo and a hair conditioner, or sneakers and three pairs of socks.

When buying a bundle, people should pay less than when purchasing all these items separately. Make sure to display the difference in price to your audience so that they can estimate it at a glance.

Besides, you can emphasize that buying a bundle involves free shipping while ordering a single item doesn’t.

Use visuals

An ideal product description includes

  • list of the most important characteristics of the item,
  • high-quality photos or videos that show how the product looks and works,
  • explanation of how consumers will benefit from buying this item,
  • CTA that encourages the client to check other products from the catalog.
  • CTAs of this type work particularly well with lifestyle and fashion products.

Don’t overdo cross-selling

Excessive cross-selling might annoy your customers. They might feel that the checkout process takes too long or the vendor becomes too pushy.

To analyze the efficiency of your strategy, you should continuously gather the statistics about your cross-sales, trying to answer these questions:

  • How many items per month do you manage to sell?
  • How much income does it bring you?
  • At which point do customers fail to complete their purchases? Why?
  • Which products tend to cross-sell better than others and which ones fail to cross-sell?
  • Which layout of the shopping cart helps you increase cross-sales?

How cross-store selling can help your business

To sum up this article, let’s analyze the primary advantages and disadvantages of cross-store selling.

- Affordable way of attracting customers
- Improving brand loyalty
- Reliable source of income
- Chance to push specific product lines
Risk of disrupting customer relationships

To make the most of cross-store selling, use the Collabica service.

  • Register to get access to a brand partnership network.
  • Discover related products from brands with similar concepts to sell on your website.
  • Earn a commission for the sale of each product from your partners.

Suppliers will be able to attract more buyers, reduce customer acquisition costs, and improve brand awareness. Retailers can expand to international markets, increase their product ranges to become more competitive, as well as boost the average order value and lifetime value of clients.

Join Collabica right now to maximize your profit!

Final thoughts

How can you grow a business with the help of cross-store selling? It’s actually simple: you give your products to a partner brand to sell through their storefront. In turn, you sell this brand’s products through your own store.

Both brands share customer data and profit with each other, but they don’t mix their inventory. This method enables you to find the right audience for your products, expand your client base with minimum expenses, and improve brand loyalty without excessive risks.

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