For decades now, Jay Abraham has been teaching that there are just three ways to grow your business:
1. Get more customers.
2. Get your customers to spend more money every time they buy something from you.
3. And get them to buy more often.
Simple … and obvious. Yet in my experience (and Jay’s), far too many businesspeople spend most or all of their marketing resources on getting new customers. And they leave #2 and #3 largely to chance.
Often they do nothing to even stay in touch with past customers. For example, I haven’t heard from the real estate agent who sold me my house in more than a decade. I’ve never heard from the salesman or the dealership that sold me my last car.
And you know what? I’ve got several past clients I’ve lost touch with simply because I was too “busy” to make the effort of following up.
Heck, I haven’t even gotten around to making sure all my clients and prospects know I have a daily ezine they can subscribe to.
Sure, maybe they’ll remember me when they have a copywriting project — or maybe they’ll just hire the next writer who gets in touch with them.
This kind of behavior is costing me — and you — a small fortune. More, in fact, than you might imagine.
In “Getting Everything You Can from All You’ve Got,” Jay Abraham runs through an exercise that makes crystal clear what we have to gain by being more diligent about selling more to our existing customers.
Step One: Figure out how many customers you have.
Step Two: Calculate how much, on average, they spend each time they visit
Step Three: Estimate how often they buy.
Imagine that you have 1,000 customers who, on average, buy from you twice a year and spend $100 each time ($200 total). Your revenue: $200,000.
Now imagine if you could increase each metric by 20%. This means:
* You add 200 new customers, for a total of 1,200 …
* You increase the number of times each customer buys from two to 2.4 …
* The average transaction grows from $100 to $120.
Add it all up, and just like that, your revenue soars to $345,600.
In other words, a 20% increase in each area sends your revenue soaring 72.8%.
Is 20% too high? Well, even a mere 10% growth in each area grows your revenue by 33.1% — taking it from $200,000 to $266,200. Still nothing to sneeze at.
Better yet, you could always calculate it the way comedian Steve Martin would, and assume a 500% increase in each metric — for a grand total of $43.2 million.
One marketing campaign, goodbye.
If only.
Of course, the calculations are easy. Making it happen is the hard part.
But a good start is the “Four-mula for Success” I shared last week. Make just four contacts every day using any combination of the following: 1) Write a thank you note to a past customer; 2) Call a past customer; 3) Make a personal contact 4) Make a sale.
Do that and you can’t help but grow your business. Click here to re-read last week’s issue with all the details.
And then stay tuned for many more tactics for growing your business.
