What is a Downsell & How to use one in a Sales Funnel

Written by Onder Hassan

Last updated: October 2 2022

Would you like to easily increase sales in your business?

Do you only have a few products in your store but would like a way to get more customers to make a purchase and increase profits?

If you answered "yes" to either or both of these questions, then you will not want to miss what will be covered in this article...

Because we will be covering downsells and exactly how they will benefit your business and provide you with some examples of how other businesses are using it to improve their profits.

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What is a Downsell?

In short, a downsell is when a seller offers a lesser and more affordable product or service when a customer is hesitant to purchase.

It is a great way to get fence-sitters to take action and make a purchase and has proven to be very effective at increasing sales.

According to a study done by Splitit, 35% of consumers are more likely to make a purchase if a site offers monthly installments as a payment option.

If you think about your everyday shopping experiences, you would realize that downselling is used constantly to encourage customers to complete the sale.

A few examples:

  • A store clerk offering an exclusive discount or a payment plan to help the customer who is on a budget.- Removing bonus features of a product as a way of dropping the price.
  • Offering an alternative product that is more affordable to the customer but equally valuable.

A downsell can also be used to describe the overall consumer use of a product, which can affect its value.

For example, if someone sells you a phone for $500 and then the next day you decide to list it again at $350, this would be considered as a downsell because someone else bought it before you.

This is because the value of the item dropped due to it being used previously by another consumer.

The same applies to any other type of asset such as cars, houses, etc.

How do I know whether my business needs a Downsell?

There are many ways in which businesses could benefit from using a downsell strategy.

However, there are some key factors that need to be taken into consideration first.

These include:

  1. The current market conditions.
  2. What products/services are currently selling well?
  3. Is there anything unique about the product or service that makes it stand out from others?
  4. Does the product offer something new or different?
  5. Are there any competitors already doing similar things?
  6. Do they provide better quality than their competition?

The key thing to consider is whether or not your business is making a profit.

If you have a successful product that sells well and is the only thing you're selling, then you may want to decide to offer a simple payment plan as a pricing option for customers who didn't buy the product.

You will likely have a number of customers who will opt out of purchasing due to budgeting issues.

So offering a downsell, in this case, could provide a great way at handling these objections and ensure that all of your customers are taken care of.

What's the difference between an Upsell and a Downsell?

Upsells are usually offered after a successful transaction while downsells are typically given during the initial stages of it.

Both upsells and downsells work together to increase revenue and profits.

What is a downsell?

In fact, both strategies should complement each other rather than compete against one another.

When choosing what kind of marketing campaign to run, you'll find that most companies tend to focus on either upsells or downsells depending on how much money they generate.

So let's take a typical sales process:

  1. A customer sees a product in your digital store that they really like and decide to purchase.
  2. Upon purchasing, they're greeted with an upsell of another relevant product with a higher price point.
  3. The customer decides to pass on the upsell.
  4. They are then taken to another page offering the same product but as a monthly payment plan (downsell)
  5. The customer decides to go ahead with the purchase and complete their order.
  6. Looking at the above scenario, you can see how powerful this is at increasing your profits and the overall lifetime value of the customer.

What started off as an initial sale ended up with further purchases, thus increasing your sales and the overall profitability of your business.

As upsells and downsells have shown to work well in business, more and more software providers have included upsell and downsell abilities as part of their software feature set.

The One-Click Downsell

The most powerful inclusion that has been added to merchant providers and SaaS checkout services is the 'One-Click Upsell' or 'One-Click Downsell.'

Prior to this feature, customers had to retype their payment details if they decided to purchase any additional products.

As you can imagine, this disrupted the buying process of the customer and increasing the likelihood of them abandoning their purchase.

With the addition of a one-click. Customers are able to add to their transactions with just a click of a button, making the checkout process seamless and straightforward.

With OptimizeFunnels and OptimizeCheckouts, we've added one-click features as part of our suite and ensured that you're able to set this up quickly and easily without any fuss.

Downsell Examples

One time offer downsell example

Here's a nice example of a product in the health niche. Offering 'Keto 4 Life' as a downsell of the initial upsell for a reduced price of $97.

A great example of encouraging fence-sitters to buy and complete their purchase.

Downsell Page Example

Here's another great example again in the health space. This time offering a different product that's relevant and useful to the customer.

This is a great alternative to consider as not all of your customers will have the same problems and may require different solutions.

As you can see from these 2 examples, adding downsells as part of your checkout process isn't that hard to do. 

With OptimizeFunnels and OptimizeCheckouts, you will now be able to set this up quickly and begin increasing yourself in just a few minutes.

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