One sure way for any company to grow and stay in business is to steadily increase the average profit it receives from each customer. For online sellers, understanding the various new revenue opportunities and creating infrastructure and business systems to take advantage of them–and create revenue lift—can define the difference between success and failure.
How to increase your profits per customer can be best understood by looking at the critical moments where you have the greatest potential to increase revenue. The following are five situations where that opportunity exists.
Up-sell and Cross-sell at Checkout
One of the most important times for increasing individual revenues is the moment of purchase. In physical retail environments, this can be seen in the proliferation of small-dollar, high-profit items lining the aisle as you approach the checkout. Magazines, soda, candy, and seasonal toys are all items that people will buy on impulse simply because of their proximity to the checkout counter.
For online sellers, the same principle applies. Once a customer has decided to buy your product and is in the checkout process, offering them relevant, timely and other affordable goods or services is a great way to increase the order value. In order to get the best results from your checkout process, you must implement data management and online store software that allows you to cross and upsell at checkout.
Freemium Distribution Model
The freemium distribution model includes multiple price points for what is essentially the same SaaS product. An example of this is Microsoft Office and its recent installation of the free versions of Word, Excel, and PowerPoint on Android phones. While the free product is great, if you want to make full use of all the features and turn off the advertising, you must upgrade to the paid subscription services. These services come at varying price points depending upon what software you need, how many users you have to license and whether you are a business, individual, student, or non-profit.
Offering tiered pricing for what is essentially a single piece of software is a great example of how SaaS businesses are changing the market—and user expectations. With SaaS, customers can get exactly as much software as they need and the company gets to increase profits by selling more expensive packages to businesses and other large accounts. To make the most use of a freemium distribution method, your online store, CRM and accounting software needs to be able to handle variable pricing from a single SKU, as well as the user-based complexities that can arise with tiered subscriptions
Integrate Online Platforms
When researching purchases, customers may do everything from read a blog and surf Facebook and Twitter to look at company white papers. All of these locations are places where you can potentially close a sale and increase revenue. To take advantage of it, you need to be able to embed the ability to conduct commerce into any place a potential customer interacts with your product or service. This increases opportunities to meet customers where they are and increase revenue.
Convert Disgruntled Customers
While no one likes to lose business, the exit of a disgruntled customer presents an excellent opportunity to learn valuable lessons about your products and or services and prevent others from defecting. As it turns out, most people are more than willing to fill out a customer-service survey or answer a few questions as they leave.
Use the exit survey to find out what is making customers unhappy and then fix it, and when it is a predictable problem (too expensive, not enough features, etc.), offer a new solution to meet their needs. In order to do this, your online store software must be integrated with your CRM system so that you can create the customer surveys for your marketing team and automatically redirect your customers to a new solution that better meets their needs.
Manage the Entire Customer Lifecycle
The customer lifecycle consists of everything from the moment a user begins researching your product to the entire time that they are your customer. With the right tools, you’ll be able to manage the entire lifecycle and take advantage of the multiple opportunities that arise to close new sales, obtain recommendations and increase brand loyalty.
A good eCommerce solution will be designed so that you can easily visualize and manage your customer lifecycles with a workflow that maximizes revenue at each important stage.
These are just five of the top ways your business can utilize great technology and a marketing mindset to create revenue lift. When you start to see important moments in the customer lifecycle as opportunities for revenue lift, you can refine the customer experience at each of those points to maximize spending and repeat business. To learn more, download our data sheet on converting revenue leakage to revenue uplift.
Avangate powers modern Digital Commerce, solving the complexity of online commerce, subscription billing, and global payments for Software, SaaS and Online Services companies. Backed by a proven cloud platform, unmatched expertise and a depth of digital commerce services, Avangate helps digital business leaders drive the fastest path to revenue, maximize the value of every customer, and expand global reach. Contact us for more information about how our digital commerce services can help you grow your business.
