Cross-Selling and Up-Selling
Cross-selling and up-selling are fundamental database marketing activities for developing customers; that is, increasing customer expenditures with the firm. Cross-selling entails selling products in the firm's product line that the customer does not currently own. Up-selling entails selling “more” (higher volume, upgrades) of products they already are buying from the company. This chapter focuses on database marketing models for cross-selling and up-selling. Included are next-product-to-buy models, which predict which product the customer is likely to purchase next, and extensions using hazard models that predict when the customer will buy. We cover data envelope and stochastic frontier models for up-selling. We conclude with a framework for managing an on-going cross-selling effort.
KeywordsCustomer Satisfaction Switching Cost Stochastic Frontier Stochastic Frontier Model Target Customer
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