There are 7 numbers you need to measure, track and manage in your business if you really want to grow it (by which I mean grow the profits in your business, not just the turnover). These 7 numbers are the 7 Profit Zones in your business.
In previous posts I explained how to use Profit Zone 1 (increasing the number of enquiries) and Profit Zone 2 (increasing conversion rate) to grow your business profits.
If you increase both those multipliers by just 10% in your business, you’ll have 20% more clients or customers than you do right now.
Today I want to talk about Profit Multiplier no.3: increasing the size of customer transactions.
Getting each customer or client to spend a little more with you each time is a great way to increase your turnover and profitability in a time and cost-effective way – it’s much easier (and therefore cheaper) to sell something to an existing customer than it is to find a new one. In fact, it could cost you 6-8 times less to get an existing customer or client to buy something else from you compared to finding a new client to make the same purchase.
So how can you get clients to spend more each time? Well, you have some choices (depending on what kind of business you have):
- For products: get them to buy a higher quantity of your product
- For products or services: get them to buy something else you offer at the same time
- For services: offer a package or bundle of services, or a retainer.
- Or you could simply raise your prices.
If you don’t currently have any strategies in place to increase the size of your customer transactions, maybe it’s time you gave it some thought.
And if you’ve thought about it before and decided it’s “not right for my business” then I challenge you to think again.
Better still, I challenge you to challenge me – email me with details of what kind of products or services you provide and I’ll suggest at least one way in which you could increase the size of your customer or client transactions. If I can’t, I’ll offer you a free 30 minute consultation with me in which we can work on your biggest business growth challenge together.