Some businesses want big spenders in their sales funnel while other businesses want fast converters in theirs. But which is better for business? Which one do you want for your business?
- Big spenders are customers who spend a lot of money during a single transaction. Big spenders can offer a large influx of cash every time they buy. Unfortunately, they don’t buy often and it can take a lot of effort to convert them.
- Fast converters are customers who moved through the sales funnel very quickly. Fast converters don’t cost very much to convert. Unfortunately, they can be lower profit-margin customers.
While these aren’t the ONLY two customer profiles you’ll encounter in your sales funnel, they are two of the most common. So which one does your business need?
There’s an answer but it comes with an assumption: Assuming that the sale is consistently profitable, the one your business wants in your sales funnel is the one that you can get more of.
Sure, big spenders might be nice because they deposit a large amount of cash in your business, but if you can’t get them into your sales funnel, there’s no sense in focusing on them. You’ll end up running a boom/bust business. That’s not very healthy or profitable.
Sure, fast converters might be nice because they offer a faster sale (which usually means better cash flow, lower receivables, and higher inventory turnover), but if you can only get a few of these fast converters into your sales funnel, there is no benefit. You’ll end up wearing yourself out trying to eke profit margins from these customers.
HERE’S WHAT YOU NEED TO DO TO GET MORE OF THE RIGHT CUSTOMER INTO YOUR SALES FUNNEL
- Figure out what kind of customer you tend to get more of. Big spenders? Fast converters?
- Find out where that kind of customer originated (i.e. where they were when they started as an Audience-stage contact in your sales funnel). How did they end up in your sales funnel?
- Adjust your sales funnel to accommodate that kind of customer. Big spenders probably need more time and information to make a decision. Fast converters need things to be super easy and probably require a fairly competitive price.
- Tune your marketing to meet this group. If the kind of customers you’re going after are big spenders, and they are more sophisticated buyers, then adjust your marketing at the Audience stage, Lead stage, and Prospect stage to accommodate their more sophisticated perspective. If the kind of customers you’re going after are fast converters, make sure you smooth out and minimize the steps in each stage of your sales funnel so your fast-converting contacts can sprint through them.
- Address the shortfall. If you have big spenders, offer incentives for those who purchase faster. If you have fast converters, offer additional products to get them to spend more.
Bonus idea: If you’re just starting a business, figure out what kind of customers your competitors are serving. See if they are focused around big spenders, leaving the fast converters available to you!
Big spenders or fast converters? The answer is YES… but only if it’s a profitable sale and if you can get more of the same.