3 Highly Effective Sales Growth Strategies That Every Business Can Use
An interesting fact: The stock market is broken down into 11 major industries. Of all the industries, information technology has the highest monetary allocation. Interestingly, social media companies like Facebook, and even Google, are NOT grouped under the information technology sector as one would expect. They are instead part of the communication services sector. This is because most of the interactions on these platforms take place via mobile phone… which means they are facilitated through the telecommunication system… which reminds me: Do you ever feel like your business has reached a revenue wall? What I mean is, the business has pretty much made all the money it can possibly make. Maybe you’re stuck at a half a million and getting to one million seems impossible. Well, I’ve been there before and today I’m going to share with you three highly effective strategies that every business can use to boost sales.
You are now tuned in to leonard innovation, where we work together to solve the problems of everyday entrepreneurs. My name is Justin Leonard.
So, years ago when I started my business, like many, I initially sold affordable products that were both low cost and thus easy to sell quickly. In my case, I was an exercise equipment retailer. Still am, more than 20 years later. But my website sales were great and I had a high volume of sales. At that time, I recall the average ticket amount being less than $100. So this meant on average, the customer was spending less than one hundred dollars per transaction. For years, my sales were pretty consistent and gradually escalating. But there were three changes that I made which dramatically grew my sales.
The first was selling items with a higher price tag. Over time, I went from selling low cost items like exercise bands, sport cones, jump ropes, and gym balls… to supplementing those items with high ticket items such as dumbbell sets, squat racks, Olympic weights, and even thousand-dollar cardio machines. And when I made this one change, my sales jumped. If you think about it… Why does a restaurant offer catering? The answer is because it’s a high ticket item. It’s an easy way to take your… daily, weekly, monthly… even annual sales from here, to way up here.
But check this out… The second strategy that grew my sales was creating a presence beyond my main website. More specifically, I listed several high converting products on sites like eBay, Amazon, and Walmart. So from my main website, I created these tentacles to other websites. And what this did was increase my reach. It put my business in front of new customers who otherwise probably would not have been my customers. You figure most people maybe check one site for all their needs. Maybe two sites at most, and the only reason they check another site is because the thing they were looking for was out of stock on the first site. But in either case, the likelihood that they would stumble upon my website was low… because the perception is that the lowest price will be on the aggregator sites like ebay, amazon, and Walmart. By the way, the lowest prices are not always found on these sites. But a prudent business owner is going to take into account how a typical consumer is likely to think. And once you develop the skill of predicting human behavior, your sales will go up. One time, there was a conversation that I had with my postal delivery driver. And he mentioned that he didn’t buy anything on Amazon unless it was marked as Amazon Prime. I paused, but when I thought about it, I said, there’s probably a ton of people who think just like him. And that was the moment where I took proactive steps to make sure my items were Prime eligible. So, getting listed on some of the third party shopping sites exposed my business to more customers. And that resulted in significantly more sales.
The third strategy that resulted in a revenue boost was marketing products that were intended for fitness and sport, to new customers. Over the years, I’ve had more than a few customers who have made purchases for products that had utility beyond sports and fitness. So, what does that mean? Well, I might sell aquatic pool noodles for water aerobics. But Hobby Lobby might buy them to use the foam material for arts and crafts. Another example: I might sell a disc cone set as a field marker for athletics. Very popular product. But, every now and then, I get feedback. And in this case, more than one customer said in a review, “these work great for our motorcycle skills training course.” So, now I have enough data to create another sales listing. But instead of disc cones for sport, I’m going to sell it as a disc cone set for motorcycle training. One of the craziest examples I remember were these slingshot enthusiasts… and it turned out we offered a specific resistance band that was ideal for slingshots. So they needed a high quality rubber band. All I had to do was repurpose the products that I already had, with different titles, to catch the attention of new customers in markets outside of sport and fitness.
So these three strategies helped me to dramatically increase my sales. And once again, here are the strategies… number one: incorporating high ticket items with low to mid-priced items. Number two: increasing online presence by selling across multiple platforms. And number three: reaching new customers by promoting alternative uses for various products.
Now, some of you are offering a service instead of tangible goods, and you might be wondering how you can apply some of these strategies. There is really not much of a difference. There are websites, for example, that aggregate all the various services. So you can list your business there to attract new clients. Almost any service business can offer a high ticket option. So, this might be more of an upsell in the service industry. Or you can try to get your customers to commit to a service agreement that has a longer term. So instead of taking payment one time, before or after a service is rendered, you might try to get the money in advance for a six month or maybe annual contract. And then, almost every service business has more than one utility. Can a home or office cleaning service also run light errands for the customer? So, it’s just a matter of being creative, but the potential to earn more revenue is always there.
Next, I will answer a question that was recently submitted. And this one is from Sam. The question is… Why do a lot of multi billion dollar companies like doordash fail to make any profit?
There are a few reasons. Often, their first priority is to develop infrastructure. This requires a lot of money and resources. It means companies like DoorDash have to hire a lot of smart people to run the operation. It means they have to spend huge sums of money for advertising and promotion. It means that they might have to discount or give away their services to attract new customers, which means they lose money. It means that they have to spend huge sums of money on software, servers, real estate, security, and other resources to handle the demand of one of the most popular apps. It means that they might spend huge sums of money to acquire other businesses that have the potential to bolster operations. These days, almost no publicly traded tech company has just one utility. DoorDash will almost certainly leverage their brand for additional services in the future. Whatever they are planning will require more money and resources. They also have to spend huge sums of money to deal with never-before-seen legal challenges. Billion-dollar companies are backed by banks, which in part make it possible for them to sustain years of losses. They are all strategic losses. The trend of taking losses for years in exchange for building up infrastructure most likely started with Amazon. Another possible reason is because profit can be controlled. We can safely assume that DoorDash is more than capable of determining the monetary value of each user of the app. Similarly, each delivery driver has a monetary value or an average dollar amount that they generate. A company like DoorDash can raise or lower fees by just $1 and it could mean the difference between making a profit or losing money.
Got a question? Let me know at leonard innovation.com and I will usually answer the question on the same day. Lastly, if you enjoyed this presentation, the next one will be even better. And for more high value content, leonardinnovation.com is the place for free entrepreneur resources like the 90-day online launch guide, free online courses, and more. Once again, the website is leonardinnovation.com And if you found this information helpful, please share it with a friend. Thanks again for tuning in.
