Reviewed by Sep 30, 2020| Updated on
Cross-selling means offering goods similar to or equivalent to an established consumer. Cross-sale is one of the most popular marketing strategies. Definitions of cross-selling in the financial services sector include offering various forms of stocks or goods to investors or tax preparation services to clients interested in retirement planning.
For example, if a bank client has a mortgage; their sales staff can attempt to cross-sell a personal credit line or a savings product like a CD.
One of the critical methods of generating new revenue for many companies, including financial advisors, is the cross-selling of goods and services to current clients. This could be one of the easiest ways to develop their company, as they have already built a customer relationship and are familiar with their needs and goals.
However, advisors must be careful when using this technique— an investment manager who cross-sells a mutual fund that invests in a particular sector can be a smart way for the investor to diversify their portfolio. But in many situations, a consultant who wants to sell a mortgage or other product to a client beyond the information reach of the advisor may cause problems.
If successfully done, the cross-selling will turn into a considerable income for stockbrokers, insurance agents, and financial planners. Registered income tax preparers will sell insurance and investment plans their tax customers, and this is one of the easiest to make of all sales. Efficient cross-selling is a sound market practice and is also a valuable technique for financial planning.
Counsellors who cross-sell financial goods or services need to have a detailed knowledge of the items they offer. A stockbroker that sells mutual funds may need considerable additional training if it is assigned to start selling mortgages to clients.