Sales funnels are the most important part of your business. Get an early glimpse into how they can help your business by reading this early draft excerpted from my Sales Funnel Bible book.
When your sales funnel is running smoothly, your target market pours into the top of your funnel and they flow through predictably so that the same number of people spend the same amount of money on a regular basis, and you earn a consistent revenue and profit. That’s what happens if you start up your sales funnel, get it running profitably, and then never change it. Like an engine with an unlimited source of fuel, your sales funnel “engine” should run indefinitely (until something changes or breaks).
It’s okay to build a “set-it-and-forget-it” sales funnel, but why would you want to do that if you could make more revenue (and more profit) with a few improvements? In a previous chapter, you read that there are three ways to grow your business using your sales funnel:
- You can increase the number of people going through your sales funnel at one time
- You can increase the speed that people go through your sales funnel
- You can increase the amount of money that each person spends in your sales funnel
Increasing the amount of money that each person spends is a key way to grow your business. It’s a good way to grow your business because you’re bringing in extra money per person without making a lot of increases to your marketing (and without straining the capacity of your sales funnel to pump even more people through). Increasing the “customer spend” increases the amount of money you make per sale, it reduces your cost-per-sale, it makes you more profitable, and you can increase your revenue with a much smaller effort than simply dumping more people into the top of your sales funnel. It just makes sense to try and sell more per person.
So, how can you do that? Obviously it depends on who your customers are and what industry you’re in but I’ve gathered a few ways to increase customer spending.
- You should test a higher price point – both in your regular sales funnel and with a segment of higher-end clients. (Even if you can’t raise your price for everyone, you might be able to at least raise your price for your luxury clients with the addition of some higher-value solutions and branding).
- You can offer up-sells and ancillary sales at the sale (or shortly after). This was covered in a previous chapter. In my experience, this is one of the fastest and easiest ways to make more money per person from your sales funnel.
- You can follow-up with customers and get them to buy more later – thus increasing customer spend over time, instead of all at once. This was covered in a previous chapter.
- Depending on your product, you might offer bulk discounts for larger volume purchases. This might reduce your price-per-product but it will increase your price-per-sale.
- Another way to get people to spend more money in your sales funnel is to offer financing, where you finance the buyer over a period of time (charging more as a type of interest).
You’ll want to be careful to avoid the “bait and switch” situation that can happen in less scrupulous sales funnels. In those cases, a lower-priced product is offered but, at the point of sale, a higher-priced one is sold and charged. That’s not what I’m suggesting.
Rather, businesses can and should offer a range of products or services that meet the budget of different segments of their target market – so a lower-priced product might be sold to a budget-conscious customer and a higher-priced product might be sold to a luxury customer. The key here is not to bait and switch but rather to present the solutions you sell and help the customer pick the best one for them.
This chapter is excerpted from an early draft of my book. Comments and constructive criticisms are welcome. Please be aware that the chapter content and chapter order may change by publication.