The endless pursuit of new customers to grow a business often distracts us from looking after our existing ones.
This pursuit can unintentionally cause a downward spiral. Spending more on marketing, while neglecting existing customers (and their sales needs), can put pressure on pricing. This can lead to a reduction in prices or a change in product mix, resulting in less sales and the apparent need for more marketing… so the spiral continues. This is not the answer.
Did you know that it’s six times cheaper to sell products and services to existing customers than selling to new customers?
Add to this that most customers don’t buy all of your products or services (they probably don’t know the extent of them) and you have a compelling reason to focus on serving your existing customers better.
All that’s needed is better education. Better education on your products and services, the problems they solve, how your offering adds value, and why it’s different to your competitors’.
Serving existing customers better often results in new business referrals, especially if you ask for and encourage them. Not only will you increase the transaction value from your existing customers, but you can also reduce your marketing spend – as you’ll be getting new leads from those happy customers.
Here are 10 ideas to help increase transaction value:
- Identify standard ‘up-sells’ – especially those that have a higher margin.
- Offer ‘four for the price of three’ options.
- Give limited time offers.
- Provide free delivery with a minimum spend.
- Drop cheaper product options.
- Create product or service checklists to increase sales outcomes.
- Run events for VIP customers with special event offers.
- Adjust your sales pitch to focus on quality and benefits as opposed to cost.
- Work in a niche market / specialisation (as there should be less competition).
And the tenth way to increase average customer spend? Talk to us – we’ll help you identify more ideas specific to your business.
“If you don’t ask, you don’t give them the opportunity to say yes.” – Jennifer Gue
This information does not constitute financial or legal advice and is for general information purposes only. Please contact DLA Partners for specific advice relating to your particular circumstances.