As far as your business is concerned there are only four types of person in the world - Suspects, Prospects, Customers, and everybody else!
Suspects -
People that you think might be interested in your product or service if given the chance to see it.
Prospects -
People who have seen your product or service and you have qualified them as interested.
Customers -
You know this one!
The trick to having a profitable business is moving people from the Suspect category to the Customer category at as low a cost to you as possible.
Let's take a look at some methods of achieving this.
Your Suspects
Step one, take a look at who you consider to be suspects. What type of person is likely to buy your product (when I say buy your product, I also include buying services, signing up for newsletters, whatever it is you are trying to achieve... the principle is the same). The conversion of Suspects to Prospects is much easier if your suspects have been accurately identified in the first place.
How do you identify a 'suspect'? It's very easy to say "someone who wants to buy my product", but very hard to find out who those individuals are - so how do you do it? Well first think about what you are selling. What benefits does it bring to the buyer? Are there any downsides? Those benefits should tell you why someone is buying what you offer, the downsides tell you why they may not. Now we can consider what type of person wants the benefits that your product brings.
Let's consider two examples, A business opportunity site and a gift site.
What benefits would a business opportunity bring to someone?
- A new source of income
- The chance to gain independence
- The possibility of working from home
- The opportunity to make more money than can be achieved on a salary
- A chance to get out of the rat race
Now we can identify the type of person who might be looking for exactly these benefits. A very quick analysis would suggest that single parents would be attracted, simply because of the chance to work from home and be independent. Homeowners, again especially if married with children could be attracted by a new source of income. Maybe homemakers, housewives and house husbands would be a good group as they might wish to earn an income at home.
We now have a number of groups of suspects - none of which have actually stated that they are looking for business opportunities.
What about a gift site - what benefits do these bring to the buyer?
- The opportunity to bring pleasure to someone by giving a gift of interest to them
- Ease of purchase of gifts instantly on-line - saving time
- Delivery of gifts to remote addresses
- A selection of gifts that is probably larger than could easily be found elsewhere
Who needs these benefits? Well, what about top executives? The chance to get a Valentines day gift for a loved one when time is otherwise not available. Secretaries/Personal Assistant's often find themselves having to perform exactly this function for their employer, so again they could be a suitable target. Married couple's on Valentine's day will of course make a good target. Anyone with family and friends widely scattered might also be a target (though harder to identify) - maybe single homeowners? military personnel, students? All of these are possibly living a long way from friends and family.
As you can see, we are now looking at the gift buyer 'suspects' in a different way, and coming up with some interesting definitions.
Prospects
Having identified your suspects, the next stage is to see if they might actually be prospects. A mailing with HTMail makes that a fairly simple process. Those people mailed that visit your web site will normally provide feedback on what they thought of your site. Those who say that they 'will' or 'may be back to purchase' are your obvious prospect list. Those that purchase on first visit to your site can skip this stage! Prospects are critical to your business. They are interested in your product - but for whatever reason (sometimes the feedback tells you the reason) did not buy immediately.
Having identified a prospect - don't let them go! You need to follow up. Work on their objections, and turn them into customers. HTMail's new focused re-mail service lets you mail ONLY those who expressed an interest in buying from you - that makes the follow up far more cost effective!
Customers
The critical question is how do you turn a prospect into a customer? The most common problem when selling on the Internet is simple buying resistance. People don't know you. They don't know if your offer is genuine, if you can be trusted. Often this can be overcome by simple familiarity. Let them get to know you through your follow up. It is likely that they will eventually make a decision on your product - to buy, or not to buy.
If you want to swing the decision towards 'buy' more often than 'not buy' you need to make some decisions on the value of this customer to you. The first question to ask is do your customers come back to buy from you again and again, or do you make a single one off sale?
If you have regular orders from your customers, then the decision on how to get this prospect to make their first purchase is much easier. Check out the average lifetime value of your customers (see our previous article at http://www.htmail.com/article3.html). The chances are that to make that first sale and turn that prospect into a customer, it will be worthwhile for you to sell at cost - or even at a loss, just to start the buying habit off. With products that promote regular repeat orders, you will make your profit on the subsequent orders - the first can therefore happily be a loss leader.
So that's one technique. Where your product encourages repeat orders, offer an AMAZING deal to your prospects to turn them quickly into customers.
What about one off sale products? How can you make something more attractive if you have to make all your profit on one sale? The answer here is added value. You need to add value to this product, but using something that has a low cost to you. There are many solutions to this, but a typical answer, especially on the net, is an information product. Information can easily be delivered using the internet, and will usually have value. It may be a report on how to market your web site, a beauty tips electronic book, whatever is appropriate to your product, and that you are able to produce yourself, or source from elsewhere on the net. You need not stop with just one add on. You must have seen this technique used, where the list of extras that you get when you take out a magazine subscription or similar seem to dwarf the detail of the product itself? Well, that is what you need to achieve. Offer enough low cost (to you) extras that add value to the basic product, and the cost of the product becomes hardly noticeable.
Those are two routes to make the change from prospect to customer. All of the above depends on your having got all of the basics right - a tidy, trust inducing web site, good products and prices etc. The main point is, it is worth going beyond the basics to make that first sale. Do something special to turn that prospect to a customer!
Dave Broadway
February 2001
Copyright (c) HTMail Ltd 2001 http://www.htmail.com all rights reserved.
You may freely distribute or publish this article provided you publish
the whole article and include this copyright notice and links in full.
