When we think about growing our revenue, the first thing we often ask ourselves is how to get more customers for our business. What about your existing customers? Looking for ways to increase revenue through your existing customers is not only easier, it can be more profitable than spending time and money to acquire new customers.
While you never want to stop marketing for new customers, take a look at the 5 suggestions below on how you can increase your bottom line with the customers that you have.
Most business owners are terrified of raising prices, imagining a mass revolt from their customers at the mere suggestion of it. It's all in the approach. The last thing you want to do is to not raise your prices for years, then launch a huge price increase because you realized that you can't be profitable without one. Offer increases in small amounts, and gradually so the impact is small on your customers. With each price increase, offer your customers a chance to buy in bulk at the old pricing before it goes into effect. You may find that your increase results in a temporary spike in sales for your business.
Shorten the buy cycle
If you're average customer purchases from you once every 6 weeks, why not see if you can incentivize them into purchasing every 4 weeks? With an average sale of $50, a 6 week buying cycle would produce a yearly customer value of about $425 a year. If you shorten that to once every 4 weeks, that same customer is now worth $650 a year for your business. And that's only for one customer.
When your customer makes a purchase, do you create additional offers for them at time of checkout? Offering other products at the time of purchase is a tried and true way to generate additional revenue out of each sale. The key is that it should be relevant to the original purchase and it shouldn't be a large ticket item, it's an easier sell if they don't have to think too hard about it. A perfect example of upselling is in fast food when they offer to “supersize” your combo for just $.59 more. The additional cost is minimal to the business and the price is so low, it's hard to say no.
Give incentives to purchase in bulk
Why not offer your existing customers a discount if they purchase from you in bulk? A personal trainer I know used to charge on a per session basis. She still does, but now offers a “10 pack” of sessions at a discount. Within three months, she was selling 10 session packages more than single sessions. It also increased her customer retention as she was able to build stronger relationships with the longer time commitment.
Offer a subscription model
Are their opportunities to offer a monthly subscription plan for your products or services. Consumers are warming to the idea of monthly subscriptions for just about any product or service. The organic farm up the road from me offers a monthly plan where they will deliver organic meats and in-season vegetables to your home each month. The owner of the farm told me their average customer would purchase once every 3 months from them, now they purchase 12 times a year, automatically billed each month to their credit cards.
There are lots of ways to get more out of what you already have
What strategies will you implement this year to generate more revenue from your existing customers?photo credit
Latest posts by Gary (see all)
- Why Every Small Business Should Be Doing Video Marketing - June 13, 2019
- 5 Common Local SEO Mistakes To Avoid And How To Fix Them - May 29, 2019
- Daily Motivation-Jim Rohn - April 17, 2019