What does 'cross-selling' mean in sales terms?

Cross-selling refers to the practice of encouraging customers to purchase additional products that complement or relate to their original purchase. This strategy is beneficial for both the customer and the business. For the customer, it enhances their overall experience by providing solutions that meet more of their needs. For the business, it increases the average transaction value and fosters customer loyalty by showcasing a more extensive range of products or services that improve the initial purchase.

In this context, cross-selling can be seen in various industries; for example, a customer buying a camera might be encouraged to buy a memory card, a camera bag, or a lens. This approach not only adds value to the customer’s original purchase but also maximizes sale opportunities for the business.

The other options do not accurately define cross-selling. Encouraging referrals pertains to gaining new customers, offering discounts focuses on pricing strategies rather than product bundling, and promoting single-item sales at higher price points emphasizes high-margin items without considering additional purchases that enhance customer satisfaction.