How to Get Undying Loyalty and More Profit From customers with a Little Known Used Technique
In this economic climate businesses should be earnestly seeking ways not only to make more profit but also to keep customers longer. One way some businesses do this is by investing in research and development specifically to develop new products to sell.
Another way business does it is to spend money directly on sales acquisition in order to get more customers. In both strategies’ even if the money and expertise is available to successfully implement it is generally a phyric victory at best unless the business finds a way to stop losing existing customers in the short and long term.
While either way suites larger companies for obvious reasons, for small to medium business it is wiser to secure new and better products without the cost of research and development. Then promote these new products to existing customers [if possible] without the acquisition costs.
It means taking advantage of the power of on-selling at the moment a customer decides to buy. Now before you get excited and say to yourself “I’m already doing that” take a breadth, keep an open mind and read on. I’m not referring to one-time up-selling or additional products sold to your customers at the point of sale. Sure selling “up-grades”, “add-ons” or “up-sell” as its known is an area that can be profitable for many businesses in increasing their existing sales.
But this strategy has its negatives and can cost the business more than actual money. This strategy is so flogged to death now, customers expect the up-sell and are fully aware of what a business is doing and this activity actually teaches the customer to return with the standard retort “no thanks”. Also in the hands of amateur retail, phone or on road salespeople it’s a high pressure tactic that should be avoided.
The other negative against this form of selling [besides the cost and resources it takes to implement with no assistance towards developing undying loyalty in customers] is it forces the customer to look elsewhere and makes them more susceptible to better offers when they make itself available. This is a symptom of customer *churn.
What is the answer to the problem to getting more profit, sales and developing undying loyalty in customers?
In my experience there is a little known but effective way to get more business while keeping *85% of your customers happy to do business with you over time. This strategy has to do with providing more for the customer. I explain it this way. It’s better to “on-sell” rather than “up-sell”.
No this is not a play on words but a legitimate strategy difference to get what you want more easily with remarkable results, let me explain. I like to offer customers extended services or benefit packages before, at the time of signing and at a specific time in the future.
I’m talking about offering customers the ability to expand or extend [the on-sell not up-sell] their confidence in their purchases over time and at the point of sale. It is also known as the “extended warranty”. Let me explain a little more about this strategy.
There are numerous ways to sell extended warranties (or what I prefer to call “expanded or extended benefit packages”… [hmm a new language more on that later). This technique has the potential of increasing the size of a customer’s purchase by up to 200% or more. Surprisingly this is acceptable to the customer because it is a relatively unknown and an unused method of getting more revenue.
The sale of these extended benefits has higher profit margins simply because they are normally a service, guarantee or information product that the customer is being offered. Not a cleverly designed new product that has been designed by the R and D team at great cost. For example: there is some limited “extended warranties” for cars, electrical goods, TV’s and other products.
Some businesses do offer an extra benefit for [or I prefer a difference of] $x where the customer can get additional protection, roadside assistance, operator-assistance for their car. TV, electrical product, in house theater in the event it breaks down, needs repairs, or requires new parts. Relatively few others offer 5 years warranty instead of the usual 1 year. This can be over and above its present guarantee or warrantee.
So, help them feel more secure with the knowledge that they will continue to enjoy your product or service. Sell them extended warranties!
For more details : http://www.the-richest-man-in-babylon.com
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