n o ren
Economics & Markets

More Upsells, Lower Loyalty

When a telecom company pushed upsells too hard, their customers started leaving.

2026-08-082 min read

The concept of upselling is straightforward: offer customers a better product or service for a higher price. However, when taken too far, it can have unintended consequences. Consider a team of account managers at a large telecom company who were incentivized to push upsells to their clients. They were given targets and bonuses for meeting certain sales numbers, which led to a culture of aggressive upselling. Customers were constantly being offered new plans, devices, and features, often with little regard for their actual needs. At first, sales numbers went up, but soon, customer complaints started pouring in. People felt pressured and annoyed by the constant upselling, and many started to look for alternative providers. The telecom company's customer retention rates began to drop, and they eventually realized that their upselling strategy was backfiring.

The issue here is one of behavioral economics. When customers feel like they're being taken advantage of or pushed into buying something they don't need, they become distrustful and disloyal. This is especially true in industries where customers have a high degree of choice and can easily switch to a competitor. In the case of the telecom company, their aggressive upselling strategy ended up driving away the very customers they were trying to retain. This phenomenon can be seen in various industries, from insurance to software sales, where companies often prioritize short-term gains over long-term customer relationships.

A more effective approach might be to focus on providing value to customers rather than just pushing upsells. This could involve offering personalized solutions, providing excellent customer service, and building trust through transparent and honest communication. By doing so, companies can create loyal customers who are more likely to stay with them in the long term. In the case of the telecom company, they eventually shifted their focus to providing better customer service and more personalized solutions, which helped to improve their customer retention rates and overall business performance.

Key insights
Aggressive upselling can lead to decreased customer loyalty and retention.
Providing value to customers through personalized solutions and excellent customer service can help build trust and loyalty.
A culture of upselling can also negatively impact employee morale and motivation.
Why it matters

If companies ignore the negative impact of aggressive upselling, they risk losing their most loyal customers and damaging their reputation.

Furthermore, a culture of upselling can also lead to a decrease in employee morale and motivation, as sales teams become disillusioned with the pressure to meet sales targets at any cost.

Use this tomorrow
1
Review your sales strategy and identify areas where upselling is being prioritized over customer needs, then adjust your approach to focus on providing value to customers.
2
Implement a system to track customer complaints and feedback, and use this data to refine your sales approach and reduce the likelihood of driving away loyal customers.
Go deeper

The concept of upselling is closely related to the idea of price anchoring, where customers perceive the value of a product or service based on its initial price. When companies push upsells too hard, they can create a negative anchor that drives away customers.

Research has shown that customers who feel like they're being taken advantage of are more likely to engage in negative word-of-mouth and leave poor reviews, which can further damage a company's reputation and bottom line.