| Cross-Selling is a practice of selling an additional | | | | or to attract customers or for new product |
| item to the customer to increase the overall sales | | | | introduction. |
| opportunity for a retailer. Since the basic principle | | | | Amongst the various statistical techniques |
| of any retail business is to establish good | | | | available, conjoint analysis help to discover the |
| customer relationship and to have a win-win | | | | relationship present among the products. Here |
| situation in practice, it is equally important to know | | | | customers are surveyed with questionnaires on |
| whether the customer gets benefited by the idea | | | | their preferences to understand the relationship |
| of cross-selling. Having said this, it is very | | | | which would be treated statistically to arrive at |
| important to know scientifically which product | | | | structured results. These results are put under |
| creates an opportunity to cross sell, or else it | | | | trial for testing for certain period; these test |
| would lead to loss of revenue for a retail firm. | | | | results then can infer the relevant changes that |
| With an understanding of the idea of cross selling, | | | | need to be made before implementing the |
| one can hypothesise manually on few products | | | | strategies. |
| which would follow cross selling. But for a retailer | | | | Amongst other popular techniques are Collinearity |
| with a large number of products, it becomes | | | | analysis, regression analysis, cluster analysis. The |
| practically difficult or rather impossible to ascertain | | | | availability of powerful data analysis software and |
| the principles of cross selling for large number of | | | | sophisticated mathematics makes it simple for the |
| products. Are there any scientific options which | | | | retailer to make simple changes in his |
| would statistically identify the opportunity of cross | | | | merchandising strategies to result in significant |
| selling and improve the confidence of a retailer to | | | | increases in his overall revenue. |
| sell more? | | | | Retailer's possession of POS level data presents a |
| Yes, it is possible to examine the hypothesis on | | | | huge opportunity to increase revenues with little |
| cross-selling scientifically and discover relationship | | | | investments. The technology needed to make put |
| among various products. Having found the | | | | science behind the money is now affordable to |
| relationships, a retailer can develop strategies in | | | | the savvy retailer who is willing to embrace the |
| many ways like, to plan on promotional campaigns | | | | new methodologies. |