What is 'Cross-Sell'

Cross-sell is the practice of selling or suggesting related or complementary products to a prospect or customer. Cross selling is one of the easiest and most effective methods of marketing. In the financial services arena, cross selling can mean selling different types of investments to investors, or even insurance to investors, or tax preparation to retirement planning clients.


If done effectively, cross selling can mean significant profits for stockbrokers, insurance agents and financial planners. Income tax preparers who are licensed can offer insurance and investment products to their tax clients, and this is among the easiest of all sales to make. Effective cross selling is not only a good business practice, but is for effective financial planning as well.

The Emergence of Cross Selling in Financial Services

Until the 1980s, the financial services industry was easy to navigate, with banks offering savings accounts, brokerage firms selling stocks and bonds, credit card companies pitching credit cards, and life insurance companies selling life insurance. That all changed when Prudential Insurance Company, at the time the largest insurance company in the world, acquired a medium-sized stock brokerage firm call Bache Group Inc. Prudential’s reason for the purchase was to create cross-selling opportunities for its life insurance agents and for Bache’s stockbrokers. It was the first big effort at creating a one-stop-shop for financial services. That was followed by other big mergers, such as Sears Roebuck (credit cards) and Dean Witter (stocks, bonds, and money market funds), American Express Company (credit cards) and Shearson Loeb Rhoades (stocks, bonds).

The mergers of Wells Fargo & Co. with Wachovia Securities, and Bank of America with Merrill Lynch Wealth Management, in the 2000s occurred at a time of declining profits for both banks. The acquisitions were done with the intent of achieving greater scale in the sale of their banking products. To a great extent, they were aiming to expand their own retail distribution arms by buying large and established distribution channels. Both banks placed a heavy emphasis on cross-selling as a strategy to regain profitability.

With few exceptions, cross-selling failed to catch on within many of the merged companies. Conflicting sales cultures and resentment among sales representatives for being forced to sell outside their comfort zone have been difficult obstacles to overcome. Bank of America has been losing Merrill Lynch brokers over its insistence they cross sell bank products to their investment clients. Wells Fargo has been more effective instituting cross selling because its merger brought together two similar cultures.