What is Downselling and How Does it Increase Conversions and Profits

by Jim Kaspari

The best ways to increase your small business profits are to 1) get more leads   2)  increase profits and 3)  convert more leads to sales.

Let’s discuss lead conversion strategies… and let’s start with downselling.  Do you currently use a downsell strategy?  What is downselling?

Downselling is nothing more than offering a prospect an alternative at a lower price when they decline your original offer. The goal is to turn the prospect into a client, so you not only realize some short term financial benefit… but you gain the opportunity to do business with them again in the future.

For example, local health clubs always try to sell new members a full one-year membership. If that fails, they will try to downsell them by offering a 90 day “health makeover” membership. If that fails, they may go to a 30 day or possibly a one week “trial” membership. They know if they can just get them to buy something the odds of them staying with them long term goes up exponentially.

Consider the florist. Most guys show up at a florist to buy roses for their better half. Valentine’s Day, her birthday, their anniversary, Mother’s Day and so on. But suppose a dozen roses cost $50 and the guy doesn’t have that much money to spend. Since he has flowers on his mind, do you think he would consider an alternative that was just as romantic?

Do you realize if the alternative cost only $25, and that florist only used that downsell once each day which is highly conservative, that would add almost $8,000 in annual revenue for them? And that’s just one possible downsell opportunity. Suppose they had floral alternatives for weddings, lower priced options for funerals and so on.

Another example for entrepreneurs that provide services is group offerings.  Let’s say you charge $100 an hour for your services.  Some of your potential clients feel they can’t afford that, but really want your help.  You offer them group classes or sessions for $30 an hour.  When you get 10 people to sign up, you’ll be making $300 an hour!

What’s your current price point for what you currently sell? Think you could come up with an alternative for half that price? How many of those would you conservatively estimate you could sell each week? Now multiply your reduced-price times your number of weekly sales… then multiply that number times 52 weeks to reveal your annual increase.

And that’s just one downsell. How many additional downsell opportunities would you conservatively estimate you could easily develop?


Now you know the answer to “What is downselling?”  How will this help your business?  What will you try next?  What else does your ideal customer want?  What products or services can you add … and then offer them?

Hope this was very helpful.  If you’re interested in finding out all the proven strategies to increase your small business profits, I’d highly recommend clicking on this link and checking out this book!