What is 'Over-Selling'

Over-selling occurs when a salesperson continues their sales pitch after the customer has already decided to purchase. This mistake can sometimes annoy the customer and could potentially cause the customer to change their mind, causing the deal to fall through.

Breaking Down 'Over-Selling'

Over-selling can also 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 off on commission basis or through sales-linked  bonuses, and thus have 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 they neither need nor want. They 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 to close the sale and when the customer is ready to buy. Over-selling can have a negative impact on a company’s bottom line. It can also raise doubts in the mind of a buyer and can do so at the precise moment when the customer is looking for a reason to believe that they are making the right choice. 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 are worse today than ever before. Research shows that today’s buyers are more informed and better educated than ever before. With virtually an unlimited access to information, buyers have likely done their share of research, and may have even made up their mind before ever speaking with a sales professional. This access to information has changed the sales dynamic, as sales reps are no longer a consumer’s only source of information. Often, salespeople would benefit from a soft sell or presenting various options to customers. Need-based selling is usually a preferable alternative to over-selling.

  1. Customer

    A customer is an individual or business that purchases the goods ...
  2. Customer Service

    Customer service is the process of ensuring customer satisfaction ...
  3. Adaptive Selling

    Adaptive selling is a tailored client centric approach to selling, ...
  4. Soft Sell

    Soft sell refers to an advertising and sales approach that features ...
  5. Always Be Closing - ABC

    Always Be Closing (ABC) is retail jargon used to describe a sales ...
  6. Activity Quota

    Activity quota is a minimum level of sales-oriented actions that ...
Related Articles
  1. Insights

    It’s Time to Embrace the DOL Fiduciary Rule

    The new fiduciary rule levels the playing field for investors.
  2. Investing

    Why an Independent Investment Advisor Makes Sense

    Brokerages used to only offer house products to investors. Much better options exist today.
  3. Insights

    Lululemon Sinks on ‘Slow Start’ to 2017

    Weak earnings and disappointing guidance fall in line with overall U.S. retail trend. According to the CEO, the firm should have been bolder with its color assortment.
  4. Personal Finance

    The Difference Between RIAs and Registered Reps

    Here's how registered representative brokers work and how they differ from RIAs.
  5. Investing

    Why Emerging Market Equities Are a Good Investment

    Here's what makes emerging market equities an attractive investment today.
  6. Tech

    The Most Important Technical Indicators For Binary Options

    Trading binary options is not for the novice, but if you're ready to delve in, get to know the best technical indicators.
  7. Tech

    How Big Data Has Changed Marketing

    Big data has enabled marketers to enhance their customer engagement and customer retention strategies by providing insight into behavior and thoughts.
  1. What is the difference between cost and price?

    Cost is typically the expense incurred for a product or service being sold by a company. Price is the amount a customer is ... Read Answer >>
  2. What are some examples of moral hazard in the business world?

    Learn what moral hazard is and how it permeates the business world, including common examples of moral hazard at work in ... Read Answer >>
  3. What impact does brand equity have on profit margins?

    Learn how both positive and negative brand equity affects profit margins by influencing profit per customer, sales volume ... Read Answer >>
Hot Definitions
  1. Futures Contract

    An agreement to buy or sell the underlying commodity or asset at a specific price at a future date.
  2. Yield Curve

    A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but ...
  3. Portfolio

    A portfolio is a grouping of financial assets such as stocks, bonds and cash equivalents, also their mutual, exchange-traded ...
  4. Gross Profit

    Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of ...
  5. Diversification

    Diversification is the strategy of investing in a variety of securities in order to lower the risk involved with putting ...
  6. Intrinsic Value

    Intrinsic value is the perceived or calculated value of a company, including tangible and intangible factors, and may differ ...
Trading Center