Most small businesses miss huge opportunities by focusing on the first sale only.
This article will help you think of the 5th, 6th, and 7th sales and building a long term business.
When we first started a business, we put so much effort into finding the first customer!
We go out there and we give out flyers, we tweet, we promote on Facebook and we work to sell something. This costs us a huge amount of time and energy (if not money) to get the first sale. Then we move on to selling to the next person; missing the opportunity to sell to the same person something else!
It costs five times more to win a new customer than it does to retain an existing customer.
The purpose of this article is to help you think about taking better opportunity of sales every time it comes up! Instead of thinking just about the one and only first sale, let’s start to think about what we are going to sell to the same customer next, and then next, and then next!
It’s better to win one customer once and then keep selling them things than it is to have to keep going out and winning lots of new customers. Win a customer, build a long term mutually beneficial relationship and keep selling.
The best way to illustrate this is by showing you our model at the Rebel Business School and then exploring several other business models.
Here is a video from Alan explaining our sales funnel from back in our PopUp days:
The first step is quite often doing something very small or for free to establish trust with a new client! We do a taster session to build up trust first so that the customer can see how good we are. (Or aren’t!)
The OUTRAGEOUS FREE OFFER is the thing that you give away for free at the start to get people excited and into the funnel. For us that is providing free workshop sessions.
This happened to us as we walked through London one day. There was an authentic Italian chef dressed in whites with a silver platter offering free pizza. (Who wouldn’t stop?!)
It made us stop and try the pizza and then he told us about his restaurant which we regularly returned to. He got us in with an OUTRAGEOUS FREE OFFER (pizza) and we spent a fortune with him over the coming years and took lots more customers with us.
Do something BOLD to get people excited and interested in what you are doing and give them a no-risk free taster! This could be a downloadable PDF, it could be a physical taster, it could be a talk! Get creative and offer something outrageous to get them on the hook.
If this goes well then it leads to the second stage in the Rebel Business School model.
After we have gained trust by delivering on what we have promised in the first instance, we progress to selling something slightly bigger, such as a three-day Rebel course. If this goes well, we stay in touch with the client and work towards running the next version which will be a one-week Rebel Business School.
If the one-week course goes well, that leads to the next sale which is either a two-week course or a regular offer of courses over a year. If that series of courses goes well and we can prove value, we look at doing something even bigger!
We are always looking to do more to help our clients and working towards the next bigger version with them rather than constantly seeking to find new customers.
The purpose of showing you our business model is not so that you can copy it (although this has happened!), it is to illustrate how the first sale should always lead to the second sale and an ever-increasing item. Your customers will be wanting to buy more from you and you need to provide them with the next step and next purchase.
Each sale should lead to the next sale of a bigger amount.
This can be done for any industry at all. Whether you are selling beauty products, food, knitwear or events, there is always something you can sell the customer next. The purpose of this article is to inspire you to think about the seventh sale rather than the first sale.
For example, if you were a skin care business you might do something like this:
- Free taster to try.
- Sell the first hand cream. (£10)
- Then sell the hand cream, skin repair cream, and nail care cream package. (£20)
- Sign up to the mailing list and get special offers each month.
- Beauty hamper for birthday or Christmas. (£40)
- Sign up for the subscription – get a new hand cream each month in the post. (£8 a month)
- Come along for the “design your own cream workshop” and we will produce it and ship it to you each month. (£200)
A – Always
B – Be
C – Closing
The idea is always to have something else to sell to people. If your customer likes the first product/service then they want to know what else they can get. You are doing them a service and they will want to buy more from you if they love it.
Just make it easy for them to make the next purchase.
Hotel Chocolat is great for this. You go into their store and they give you the free sample of the month. The sample leads to a small purchase in store. You go back again for the next free taster, and you buy the bigger packages of chocolate. You go back again, and you join the tasting club at (£22.95) a MONTH. Then you get excited and go and visit one of their restaurants. We visited the one in London and spent £70! And if you really love what they do you can go and stay on the coffee plantation in their hotel, go on tours, go to the spa and spend thousands.
It is a brilliant model that always allows their fans to get excited and slowly buy more, get more involved and they love it!
Always be thinking of the next sale.
According to Invesp, it costs five times more to win new customers (in terms of time, money and energy) than it does to keep an existing customer.
Your focus should be on keeping your existing customers, building great relationships, and selling them the next thing!.
Your mission from this article is to sketch out your own sales funnel.
- What is the first thing you are going to give away to your customers to get them hooked?
- What’s their first purchase? How are you making this as easy as possible for them to buy? How are you taking the risk of purchase away for them?
- What can they buy next? How will you stay in touch with them after purchase one to tell them about what they can buy next? How are you building your customer list?
- How can you reward them for being a loyal customer and buying twice? Discount? Special offer?
- What can you sell them next?
- What can you sell them next?
- How are you staying in touch with them?
