Apr 13, 2021
Have you been at that point in your business where you seem to be making a lot of sales and are constantly packing orders but you just can’t understand why you’re not actually making a profit? Lots of sales means lots of profit right?
I see this all the time and while there can be various reasons for this scenario the first thing I ask our students and clients to look at is their first time customer sales vs repeat customer sales.
Did you know that an increase of even 5% in customer loyalty or repeat purchases can potentially result in up to 95% growth in your profits?
That’s a pretty big statement, right!?
Time and time again I watch business profits skyrocket when the focus is turned to increasing customer loyalty and seeing repeat orders from raving shoppers!
While we should always be looking at ways to find new customers and creating those first-time sales the mistake we make is not seeing that first time purchase as a long term investment.
Have a think about this little scenario:
You receive five $100 orders from five totally new customers, hoorah!
Your acquisition costs for each of those orders is $35 based on your total advertising spend.
Now, what if one of those customers went on to make another four $100 orders from you over the next 12 months…
Those orders came from your retargeted advertising campaign (much lower cost per conversion) or better yet, your emails (free!).
Which means those following four orders are much more profitable and much less resource intensive than your initial 5 first time purchases.
Now imagine the scenario of having hundreds of those profitable repeat orders throughout the year! What difference would that make in YOUR business?
Today I’m going to share with you:
- Why you shouldn’t expect to break even on first-time shoppers
- How your business profits can sky-rocket with repeat purchases
- Examples of businesses who have mastered this strategy for major growth
- My top tips for converting first-time shoppers into loyal and repeat customers
- Why it’s so important to know who your Most Profitable Customer is (hint, go back to Episode 19 - How to Identify Your Most Profitable Customers!)