thebestkeptsecrets.com: internet business: strategy
THE HOME BUSINESS/CAREER RELATIONSHIPS INTERNET RETURN TO MAIN INDEX
Are You Neglecting 70% to 90% of Your Internet Profits?
By Terry Dean
At the very beginning of this article, I want to tell you about a horrible mistake I have been making lately. I have been neglecting the place where 70% - 90% of most Internet profits come from.
I would normally keep a mistake like this to myself, but I also recognize that probably 9 out of every 10 of my readers are making the exact same mistake. This just shouldn't be happening.
My business is extremely profitable, but by neglecting this one technique I have been ignoring tens of thousands of dollars in additional profits.
The direct marketing rule that I been neglecting to give attention to lately is that of backend selling. I know and have taught backend selling to thousands of Internet businesses, but in the past 6 months of my own business I have been letting it slide.
For my business this means that I am ignoring additional profit centers. For many Internet businesses which aren't as profitable as mine this one mistake could easily spell the death of their entire endeavor.
To give you a quick idea of just how profitable backend selling can be for your business, let's give the following example.
Let's say you are in an information business selling a low cost audio tape set and a larger video package. The first product you have sells for $50.00 (and costs $25.00 for drop shipping from the owner) while your second package sells for $300.00 (and costs $150.00 drop shipping from the owner).
If the first product you sell to customers sells for $50.00 and costs you $25.00 to fulfill, you have $25.00 potential earnings from it where you have to pay advertising expenses from. If it costs you on average $20.00 advertising expense for each new customer, you would only be earning a $5.00 profit on every new customer.
What would happen if you included a sales letter for your $300.00 course in every $50.00 package people bought?
If 1 out of every 5 customers you brought in on the first product would also buy your second product for $300.00, you would be earning an extra $150.00 off of every 5 customers. Your front end profits would have been $25.00 for these 5 customers and your backend profits would have been $150.00 without spending more than a couple of cents extra for the sales letter included in the packages.
You would only be earning $25.00 a day in your startup Internet business is you were selling 5 packages a day. Once you add in your backend product, your profits jump up to $175.00 a day!
For many businesses, having a backend product determines whether your business succeeds or not. You must have a specific backend in mind whenever you are planning your web site, choosing a product, or designing a product.
On the Internet, it is so easy to come up with backend products! If you don't own any additional products or services to place on a backend, then you can simply join an affiliate program with a high quality product or find a business owner who will drop ship products for you.
There are thousands of companies out there which have affiliate programs or who drop ship for you. All you have to do is search for "drop shipping" or "affiliate" and thousands upon thousands of sites will come up.
If you see someone who has a product you would like to sell, see if they will set up a drop shipping program just for you. This type would often end up being the most profitable for you since you wouldn't be competing with thousands of other affiliates.
The key to backend profits in your business is to actually start doing something. So, I have included 4 easy ways your Internet business can start profiting from backend selling today!
4 Ways ANY Internet Business Can Easily Start Making Backend Sales Immediately...
1. Point of Purchase
The absolute best point for a backend offer on any sale is right after the initial sale while the customer still has their credit card out. For example, whenever I go buy a pair of shoes it always seems like once you have the shoes picked out the salesperson will then ask you if you would like laces, polish, etc.
If you go buy a suit, then they ask if you would like dress shirts, ties, etc. Any smart retailer will figure out what other products they have that naturally go with the purchases most often being made. Then, they will offer an up-sell immediately at the point of sale.
How can you apply this to your Internet business? The easiest method and the most profitable is to offer the up-sell right after your customer has made their purchase and still has their credit card out. In other words, put the additional product or products on the thank you page right after the purchase is made through your secure order forms.
At that point, your customer has their credit card out and is in a buying mood. By listing one to three similar products on this page, you should be able to increase your overall sales by 10% - 30% immediately.
2. With Product Delivery
The second key time to send a backend offer is when the products are shipped. Wise marketers throw in a catalog of other products and services they offer with every order.
Possibly offer a 30 day special coupon in the package. If they order something else from you within thirty days they get $10.00 off or 10% off or something similar to this. Just remember that there has to be some incentive to ordering now.
If you have someone else fulfilling the order for you by drop shipping out the products, then just send out your own thank you letter with the backend offer enclosed.
You should send out follow-up sales letters to all of your current customers. Top direct marketers report that it is 7 times as easy to sell to an existing customer than it is to develop a new one. Put the odds to work for you instead of against you and start selling more to your current customers.
The correct time to send out this letter depends on what you sell. If you sell a consumable product such as food, nutritional, body care, etc., then you send out the letter whenever the average customer will run out of the current supply.
If you sell other types of products, then the correct time will often be around every 3 months. Newsletter publishers will often advertise a new product in each new issue of the publication that goes out. It all depends on your products and your customers. Learn the correct time frame for sending out letters based on testing.
4. Leads that Don't Buy From You
Here is an area that most Internet marketers don't even consider, but it could quickly become a new profit center for your business. What do you do with those leads who contact you but don't end up buying?
In most businesses, they just throw them away. The smart marketer who wants to get maximum profit out of every second of their time and out of every dollar they spend will put these leads to use also.
They are obviously interested in what you are selling since something you had caused them to originally contact you for more information. They didn't want to buy your product, but what if you offer another similar product or service to them instead once you have finished your regular follow-up system for your main product.
This is definitely an area that you need to start testing out. You could also try working with another marketer who sells a similar product and work out a lead trade. You will offer your product to his leads that weren't sold and he will offer his to your leads you couldn't sell. Since the cost of follow-up online is virtually nothing, this type of additional profit center is definitely something every business should look into.
The question I am going to ask you is, "Are You Going to Leave 70% - 90% Of Your Profits Behind?"
Above are four simple techniques you can use to start making more profits out of your online business. What are you going to do about it? Are you going to at least start trying out a couple of these techniques in your business...or are you satisfied with what you are making right now when there is so much more available?
Terry Dean, a 5 year veteran of Internet marketing, will Take You By The Hand and Show You Exact Results of All the Internet Marketing Techniques he tests and Uses Every Single Month" Click here to Find Out More:
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