Four ways to boost customer transactionsJanuary 11th, 2012 | Posted In Business Advice
The importance of generating repeat sales, more sales per customer, and getting
more money out of each transaction are essential to business success. Here’s four
often over-looked strategies to achieve these…
1. Raise your price
Far too many businesses compete on price. Fair enough if you have pitched your
business at the budget conscious as a “price buster”; Red Dot, Price Line, The Good
Guys… there is nothing wrong with this strategy, and these businesses do it well, but
it is a very tough market to compete and profit in.
Most businesses will achieve better margins if they focus on delivering value.
Research shows consumers are generally more concerned with quality, prestige or
convenience than just price; you know, the emotional stuff. But guess what, if there
is nothing to differentiate your product or service from your competitors, customers
have nothing but price to compare! So steer away from price and seek to differentiate
yourself through better service or quality.
It is the perception of value that is important. Interestingly, the idea of “you get what
you pay for” still has resonance with shoppers. Even a small increase in price can
help your bottom line without dampening sales, but you need to communicate the
perception of increased value.
2. Introduce choice
Give your customer purchasing choices. Create levels of service or product options
based on price, quality, inclusions, upgrades etc. This allows you to reduce the value
you deliver for a reduced price, rather than simply discounting the price and getting a
lower margin. Once again, selling value rather than price.
If you’re not making ground on the higher priced model, it’s time to suggest the less
expensive model. Just because you down-sell doesn’t mean you can’t back-end or
cross-sell at the same time. At the same time, ask for referrals, it may lead to that
better sale you were looking for!
Sometimes making a lower priced sale that will still generate additional sales at a
later date or referrals is better than no sale at all.
4. Service contracts
Develop a monthly service contract as an optional sales add-on. Include phone
support or service calls. These contact points create great opportunities to further
build the relationship plus make future sales. You will also be in a better position to
know when the client is ready to buy a new product or service.
When you help your customer gain value from their purchase, you increase customer
loyalty and satisfaction. Of course, it also creates a valuable and recurring revenue
stream, and while some customers will never use it all the time, you are still getting
paid. A side benefit is that recurring and contracted revenue streams can add to the
value of your business.