What is the difference between Up-selling and Cross-selling?

We often see confusion regarding the 2 topics “Up-selling” on the one hand and “Cross-selling” on the other hand, although there are major differences between both. In addition, also E-Commerce systems like Magento do not distinguish properly between these two which increase the uncertainty about them.
Generally both terms describe the process of providing recommendations for other products on the basis of one or more products. The difference between Up-selling and Cross-selling will be examined in the following paragraphs.

In the process of Cross-selling several other products are recommended that are similar to the current one and may be exchanged with it. A popular example is a bike tire of brand A that can be exchanged with a tire of brand B that has similar properties (e.g. kind of terrain, pricing, etc.).
In order to be able to display those recommendations Recolize compares and weights the product attributes of the current tire with all available other products and automatically learns and creates those cross-linking connections between them.
For more information about Cross-selling please also see our blog articles about 3 Ways to Integrate Cross-Sells on Product Pages and 15 % Conversion Uplift: Automated vs. Manual Cross-Sells.

On the other hand, Up-selling describes the process of recommending products that are more expensive than the current one(s). Imagine for example you added a watch in the mid-price region to the shopping cart and on the cart page you will be displayed with luxury watches that have a much higher price.
Up-selling in Recolize can be easily done with one click by using its flexible filtering engine.
More use cases for Up-selling can also be found in our blog articles 5 Advantages of Recommendations in Transactional Emails and The Power of Real Individual Recommendations.

What is the difference between Up-selling and Cross-selling?
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What‘s the CRR (Cost Revenue Ratio) of Recolize?

We offer a performance guarantee. You will at least have a CRR of 25 %. So you‘ll generate at least $4 additional revenue with every $1 you invest in Recolize. But you will see: with Recolize your CRR will be much better than 25 %.
The average CRR of our customers is between 1 and 10 %.

An example calculation, if you generate $10,000 additional revenue with Recolize with $200 Recolize costs:

$200 / $ 10,000 * 100 = 2 % CRR

Also the ROI can be relevant to measure the performance of your recommendations. Read more here.

Read more about important personalization KPIs in our blog post here.

What‘s the CRR (Cost Revenue Ratio) of Recolize?
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What‘s the ROI (Return On Invest) of Recolize?

We normally calculate with a small margin of 40 % for our tool.
The average ROI of our customers is between 500 and 16,000 %. Some of our customers even have a better ROI.

An example calculation, if you generate $10,000 additional revenue with Recolize with $200 Recolize costs:

(40 % * $10,000) / $200 * 100 = 2,000 % ROI

A more comparable KPI (more comparable to other performance marketing activities) is the CRR. Find out more here.

Read more about important personalization KPIs in our blog post here.

What‘s the ROI (Return On Invest) of Recolize?
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When do you count a sale as conversion?

Recolize uses the so called conversion conversion tracking to determine, which articles were bought over the personalized recommendations by your customers. Therewith we have a powerful tool to optimize your recommendation configuration in the Recolize Tool and to generate more revenue with your product recommendations.

A sale will only be counted as Recolize conversion when a user clicked exactly the bought product in a recommendation widget.

The sale of an article will be tracked as Recolize conversion when it is in a close temporal connection to an interaction with a recommendation.

Recolize only tracks the information for bought articles and of course no personal data of your customer like addresses, email address etc.

When do you count a sale as conversion?
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How to integrate the Recolize Opt-out?

For generating personalized recommendations Recolize creates pseudonymous user profiles, which exclusively can be connected to an end user with a correspondent cookie on the system of the end user and are only usable on your own website respectively your own domain. This cookie contains a randomly generated user id and can be deactivated with the Recolize Opt-out by the website visitor. Please add a correspondent advise to your privacy policy.
Recolize Recommendations also work with active Opt-out without any issues. Then non-personalized products are delivered, that is only product-based cross sells and best sellers, which increase the conversion rate of your website.

To integrate the Recolize Opt-out, you just have to add the following link to your privacy policy. This link is working completely automatically and displays the appropriate text depending on the current Recolize Opt-out status of the website visitor:

<a class="recolizeOptOut" href="#" onclick="return false;" data-activate-opt-out-text="Activate Opt-out" data-deactivate-opt-out-text="Deactivate Opt-out"></a>

Please replace the colored text parts with your individual texts if you want to. The text will automatically switch:

  • “Activate Opt-out”: this text will be displayed if the Recolize Opt-out is not active. With clicking on the link, the Recolize Opt-out will be activated and the link text will switch to “Deactivate Opt-out”.
  • “Deactivate Opt-out”: this text will be displayed if the Recolize Opt-out is already active. With clicking on the link, the Recolize Opt-out will be deactivated and the link text will switch to “Activate Opt-out”.
How to integrate the Recolize Opt-out?
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What are the benefits of a Software-as-a-Service model?

Recolize is provided as a Software-as-a-Service that means you do not have to take care of any infrastructure issues, hardware failures, software updates, etc. We do everything for you and you get in return the generated personalized product recommendations.

In contrast to a so-called “on premise” installation the Software-as-a-Service model has lots of benefits for you:

  • We constantly update our software and deliver you the latest highly innovative features – and there’s nothing you have to to do for that: you’ll get these for free and right when they become available
  • No software or hardware updates required
  • Unlimited scalability: No matter if you have hundreds, thousands or millions of visitors on your website the Recolize recommendations will always be calculated extremely fast within around 100 milliseconds.
  • High availability: the Recolize service has an uptime above 99,99 % so every visitor of your page can be served with personalized product recommendations
  • Our German datacenters are highly secured to confirm with the German data privacy laws.

So what are you waiting for? Register for free and check these points out.

What are the benefits of a Software-as-a-Service model?
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Which recommendation algorithms are supported?

Recolize supports the following recommendation algorithms:

  • User-to-user (“Customers, who bought this, also bought”)
  • Item-to-item (“Cross Sells”)
  • Top items / Bestseller
  • Last viewed
  • Static product lists

The algorithms are chosen automatically dependent on the current visited page and the current user to always generate the best matching recommendations.

Which recommendation algorithms are supported?
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Which data is used to generate personalized recommendations?

If a shop visitor is anonymous and visits the page e.g. for the first time, then his clicks on products, add to carts etc. is tracked. Every time the visitor clicks or moves from page to page, his profile is updated and his recommendations get updated.
If the user logs in or is already logged in the data is saved in his customer profile

Which data is used to generate personalized recommendations?
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