The main objective of any restaurant is to produce a profit. According to the Temkin Group, a moderate increase in customer experience generates an average revenue increase of $823 thousand over three years for a company with $1 million in annual revenue. Upselling and cross-selling are two techniques that double as ways to provide exemplary customer service and increase restaurant profits.
Upselling and cross-selling encourage an increase in purchasing behavior, and each requires a slightly different technique.
- Upselling involves an employee selling additional items or “add-ons” to increase the price of an item. For example adding cheese or avocado to a burger.
- Cross-selling encourages the purchase of “extras” to compliment the customer’s purchase. For example upselling higher price items like a salad or a beer.
To help boost sales and improve guest experiences, here are four ways to effectively upsell and cross-sell to increase profit.
Teach Sales (and Social) Skills
Employee’s are the face of your business; and armed with the proper tools can be the best asset. Employees need to be trained across all spectrums of serving. This includes menu knowledge, selling techniques and social skills. These skills give them the opportunity to connect with customers and provide individualized service – without sounding pushy.
Training employees on a regular and ongoing basis is essential. The most important skill to train for profit improvement is how to recommend a product in a way that improves a customers meal while being transparent and casual. Adding cheese to a burger or upgrading a side is easy, you can also include wine or beer pairings for each meal to improve the serves ability to offer meal improvement suggestions.
Employee training should also consider social skills, cues, and body language. The server should know the customer of your restaurant enough to know when to up-sell or cross sell an item. Teaching these social skills, along with ongoing menu training, and helping a server understand what items have high-profit margins will nurture relationships with customers.
Often restaurants have too many options, using suggestion and giving your customer a simple yes or no option makes it easier for them to make a decision. Using a POS system like TouchBistro makes upselling easy because prompts can be set to remind servers to suggest something while the order is being inputted.
Counteract Customer Menu Hacks
Restaurant employees must consider that “menu hacks” exist. Customers are often looking for a deal but, they value quality and trust your establishment. One way for servers and waitstaff to continue to maximize profits and work on upselling and cross-selling is to promote high profit complementary items.
Customers can easily be overwhelmed by large menus. Find an item with a low cost and high profit margin and have all staff promote this complementary product. Customers will feel like the server is personalizing their experience. The best menu item example is fries. You could also use size increases like 6 oz vs 9 oz wine, steak or burgers to increase each cheque amount.
Sell the Value
Be clear about the value your restaurant provides your customers. There are several ways to integrate value into your upselling and cross-selling efforts like leveraging reviews. This doesn’t mean you should only sell things that previous guests have liked. Rather use reviews to recommend customer favorites.
Another great technique used to upsell new customers is to suggest an option if you notice a guest is unsure of what to choose. This could be a dinner special, customer favorite or personal favorite of the server. It could be as simple as commenting on which of the two meals you prefer to increase their ability to make a decision and turn over the table quicker. Restaurant News has 10 great tips to help improve cross selling and number 8 focuses on recommending higher margined dishes. For example, if someone asks about the salmon respond saying you like it but the Tilapia (a higher margin dish) tastes better. But building trust is essential to selling value so make sure the recommendation is or looks genuine otherwise customers will feel more uncertainty.
Understand Purchasing Behavior
Customer behavior can be understood using technology and tools that analyze their purchasing behavior. In turn, this information can be used to tailor the customer experience using e-menus and tabletop ordering, which have proven to increase bill size. Younger generations are used to interacting with screens. By removing the “people barrier of judgement and possible confusion you can increase overall bill size.
The more you know your customers, the better you can tailor your offerings to what they want. If a dinner special consistently sells out add it permanently to the menu. Recommend a wine pairing with it or ask your top customers to help you create seasonal menus. Asking high value customers to help build out menu specials gives your servers ammunition to upsell the menu.
Cross-selling and upselling techniques do not have to be obvious, blatant or annoying. In fact, the more natural the process is, the more helpful it is to increase bill amounts, and help build valuable customer relationships, causing customers to return. Customers not only feel important and loved, but they experience true value when visiting your restaurant.