Lecture Notes: Direct Selling, Cross Selling, and Upselling

Direct Selling

• Definition: Direct selling involves selling products directly to consumers without passing through a middle agent or retailer.
  • Historical Context: Began in the 1960s, often associated with door-to-door sales.
  • Modern Methods: Includes online platforms like Facebook and eBay.
  • Characteristics: Relies on personal contact and online platforms.

Push and Pull Strategy

• Push Strategy:

  • Used for lesser-known products.
  • Involves promoting the product to wholesalers and retailers to encourage them to stock the product.
  • Example: Pushing unknown brand clothes into retail stores to increase awareness.

• Pull Strategy:

  • Typically used for well-known brands.
  • Involves advertising campaigns to create demand among consumers.
  • Example: Pre-order systems like Dell computers where consumers demand products from the company.

Cross Selling

• Definition: Selling additional related products to customers who have already made a purchase.
  • Example: Insurance companies offering multiple types of insurance (e.g., house, car, life insurance) to the same customer.
  • Airlines linking travel services like hotels and travel insurance.

Upselling

• Definition: Encouraging customers to purchase a more expensive item or upgrade to enhance the purchase.
  • Example: Airlines offering seat upgrades for extra legroom or additional perks.
  • Retail example: Offering additional products for a discount if bought in larger quantities.

Conclusion

• Summary of all three strategies: Direct selling, cross selling, and upselling involve different methods of increasing sales and enhancing customer engagement through direct sales, offering related products, or encouraging upgrades.