Over-Selling

What Is Over-Selling?

Over-selling occurs when a salesperson continues their sales pitch after the customer has already decided to make a purchase. This mistake can sometimes annoy the customer and could potentially cause the customer to change their mind, resulting in the deal falling through. Over-selling also means trying to upsell a customer on more than they need or want; this may also have the effect of making the customer unconformable.

Understanding Over-Selling

Over-selling may be an effort to convince a customer that an extra item would enhance what they are looking to buy, or that a more expensive version might be a better option.

Over-selling is most common in retail outlets where associates work on a commission basis or through sales-linked bonuses. The salesperson has an incentive to sell as much as possible, regardless of the customers' needs.

Car dealerships are often accused of over-selling. Their sales associates sometimes fail to recognize that they can generate significantly more revenue through return customers and referrals than they can by misleading customers into paying for extras that they neither need nor want. Some associates at car dealerships are willing to sacrifice long-term brand equity for short-term sales by selling customers on anything and everything. 

Disadvantages of Over-Selling

Although it may be done with good intentions, over-selling usually does more harm than good. Great salespeople know when the customer is ready to buy and, thus, when they should close the sale.

Over-selling can have a negative impact on a company’s bottom line. This is because it can raise doubts in the mind of a buyer, often at the precise moment when the customer is looking for a reason to believe that they are making the right choice. Raising this doubt in the customer's mind, because they no longer trust the salesperson, could blow the sale.

Over-selling gives a buyer a reason to pause and ask themselves if they are paying too much, or if the item is more than what they need. Even if the buyer doesn't backpedal in an over-sell situation, the salesperson risks creating false expectations that can never be met, in which case they could be damaging their credibility as a trusted salesperson.

There are reasons to believe that the pitfalls associated with over-selling have become worse over time. This is because buyers are becoming increasingly more informed and better educated; with virtually unlimited access to information and alternatives on the Internet, buyers have likely done their share of research beforehand and may have even made up their mind before ever speaking with a sales professional.

This access to information has changed the sales dynamic; sales representatives are no longer a consumer’s only source of information. Often, salespeople would benefit from a soft-sell approach, or through presenting various options to customers. Need-based selling, or adaptive selling, is usually a preferable alternative to over-selling.

Example of Over-Selling

Suppose there is a college student without a lot of money. They need a used, cheap, and reliable car for getting to and from a part-time job. They only have $1,500 to spend on the car and they tell the salesperson this upfront.

Immediately the salesperson starts showing them cars priced at $5,000 to $10,000, telling the student they can get "...easy financing to afford these much better cars." The student, who already has a bunch of student loans doesn't like the idea of taking on more debt. They relay this information to the salesperson, who continues to talk about how the low the interest rate is, and how filling out the forms will only take a few minutes.

The student, uncomfortable with the overselling, leaves and goes to another dealership or to another salesperson who will show them what they are asking for.