What if you could simplify growing your business and profits by focusing on 4 easy to understand principles?
Marketing is the mechanism and driver of new business, but you can simplify increasing your company's revenue by focusing on 4 strategic and very narrow metrics.
In this clashgraphics.com article, presented are marketing strategies and the four ways to increase revenue and customer engagement.
Marketing Strategies to Increase Revenue
Strategies to increase revenue can be guided by four distinct business growth principles; customer count, average transaction, transaction frequency, and price.
Whether the marketing or advertising strategy is a buy-one-get-one, door hanger promotion, email, direct mail campaign, flyer, holiday special, or social media campaign, its underlying goal or purpose is one or a combination of the categories mentioned above.
One of the most important and fundamental aspects of a marketing strategy is a clear understanding of its intended purpose and how it will accomplish this.
1 - Increase Your Customer Count
Attracting more customers to your business is typically one of your core business goals. Right?
Sure... As long as you have the staff or the means to maintain excellent customer service and the product inventory to satisfy your new sales volume.
In relation to revenue growth and increased profitability, growing the customer base is most often a business owners first thought.
If your business was not first to market and doesn't own 75%+ market share, then increasing your businesses number of customers is a solid revenue growth strategy.
The following strategies are very effective when the focus is on increasing your business’ customer count:
• Search Engine Optimization
• Radio Ads
• TV Ads
• Newspaper Ads
• Online/Social Media Ads
• Community Event Participation
• Grand Re-Opening Event
• Billboards
• Flyer Distribution
• Door Hanger Campaign
• Direct Mail Campaign
By adding a discount coupon or promo code to your marketing material, you give potential and returning customers a reason to pay your store or site a visit again. This leads us to the next category to grow your business.
2 - Increase Customer’s Average Transaction Amount
Building on your current customer base is smart business. This is where customer service becomes personalized service, and knowing the needs of your customers helps you put the right products in their hands.
The more products you carry which offer solutions to the needs of your customer, the more they are likely to purchase.
If your business has 200 customers per week that spend an average of $50 per week, that’s $10,000 in weekly revenue. Now, if through a promotion, demonstration, or sale, you can get half of your customers to spend an extra $5 per week, you’ve increased your weekly revenue to $11,000 or a gain of 10%.
Merchandising also plays a massive roll in increasing the average transaction. End caps or displays can be used to suggest a combination of products, while popup suggestions and instant discounts can be very effective for online stores.
The following strategies when coupled with customer engagement, smart merchandising, discount coupons, BOGO, buy x amount get y% in savings, etc. can be used to increase your customer’s average transaction:
• Email Advertising Campaign
• Instant Online Savings
• Social Media Ads with Coupon Codes
• Direct Mail Coupons, Flyers, and Newsletters
• In-Store Coupons, Flyers, and Newsletters
• Free Samples (when possible)
Note: Anyone who ever shopped at Kmart probably remembers the random (over the p.a. system) “Blue Light Specials.” This is a classic example of how to entice your customers to get something extra in their basket.
3 - Increase Frequency of Customer’s Transactions
How do you get your customers to visit and buy more frequently? In this category, your strategies must be focused on two specific targets:
Customer Experience - What keeps your customers coming back? Whether online or in-store, it’s the experience they have and value they derive from interacting with your business.
Value and experience can be expressed and appreciated in different ways. For some, speed and price represent value, while others see personalization as a more compelling value proposition.
The better the service and seamless checkout is, the easier customers can shop, and more likely they are to do so more frequently.
Engage Your Customer Base - The very same strategies used to increase the average transaction size can be modified to increase your customer’s transaction frequency.
Take yourself for example. Why do you keep going back to specific locations?
• Is it the customer service?
• Could it be the convenience of the location?
• Is it an irresistible offer or monthly promotion?
More than likely, it is a combination of all these and a few more reasons.
To help strengthen your customer’s loyalty and get them to your location or website more often, make them feel that they have a say! You can encourage and invite their input and feedback through satisfaction surveys using the following:
• Email
• Pop-Up in the Online Store
• Direct Mail
• In-Store
When changes are made that result from customer feedback, you have another opportunity to build on customer loyalty. By letting them know (individually by thank you cards or collectively by banners and signs) that they were the catalyst for improvements, they will be more likely to patronize and frequent your store.
Note: It is not wise to ask for customer comments, feedback, or suggestions if you are unwilling to accommodate and make changes.
4 - Increase Product or Service Prices
This is undoubtedly the least popular of the four categories, and the easiest to backfire if not handled properly.
If the time comes that you must raise your prices to increase revenue, or compensate for rising costs, the following strategies can help prepare your customers and avoid significant decreases in your number of customers and average transaction:
Run a Promotion - Before prices go up, run a promotion on the affected items and advise your customers of the coming price changes.
Be Forthcoming - Explain why the prices are going up. Consumers, in general, will absorb reasonable price increases for items they see as essential. Especially when they understand why the price went up.
Show Results - If the prices are going up for an expansion project, give your customers periodic updates. If it is to hire more employees to serve your customers better, make sure it happens.
You could simply raise your prices and “cross your fingers” that no one notices. Besides having potential complaints and bad online reviews, you will have lost an opportunity to display your empathy and commitment to customer’s feelings and experience.
Growing Your Business Through Customer Engagement
The four ways to increase a business’ revenue all boil down to customer engagement. With honest and consistent communication, you can naturally boost your revenue, even if it means having to raise your prices.
In this article, you discovered the top four ways to increase revenue, the strategies that help you achieve it, and the importance of customer engagement throughout the process.
With a well-structured marketing strategy, guided by exceptional customer engagement, increasing the customer count, average transaction, transaction frequency, or even increasing prices can translate to increased revenue, profitability, and customer satisfaction and satisfied customers.
Sources:
http://web.stanford.edu/group/instr_design/cgi-bin/case_study/strategicthinking/module3.html
https://www.middlemarketcenter.org/expert-perspectives/top-3-ways-to-increase-revenue-with-existing-customers/
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2233 Peachtree Rd NE Ste 202 Atlanta, GA 30309
(678) 235-3464
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