In the previous 2 posts, we have looked at two different strategies to Grow Your Business. If you would like to read these first, please click one of the links below:
Strategy 1 - Increase The Number Of The Right Types Of Customers
Strategy 2 - Increase The Transaction Frequency
Today, we’ll take the next step and turn the right types of customers, who are spending more often (Strategies 1 & 2) into customers who are spending more:
Strategy 3: Increase the value of each sale
Of all the strategies, I think this is probably the easiest to grow your business. It is also one that can quickly be tested and measured to see what works and what doesn’t. Every business is different but there are plenty of options to try to increase sales value. And if you can get a few of these going, your business won’t look back.
Here are 4 tactics you can apply to your business today to increase the value of each sale.
1. Upselling
One of the classic examples of how to increase the value of each sale is McDonalds – “Would you like fries with your order?”. This is called upselling, that is you ask the customer if they would like to add another product to their order. The key here is you have to ask.
Adding an incremental dollar value to each sale adds up over time and is a really simple way to grow your business. It is also important to train staff in how to do this in every transaction with customers until it becomes second nature (remember, it takes 21 days for a habit to form).
2. Increase Your Range
Regardless of your business, there is always something extra you can sell people, and if you don’t have anything extra, this is the next way you can add value to each sale – increase your range. It is important here to add products that make sense to your business and that customers are looking for. Is there something that your customers often ask for that you don’t stock? Then start to stock it (if it makes profitable sense too) and sales will increase.
3. Bundle Products
A third tactic for increasing the value of each sales is to bundle products together. If the bundle represents good value, customers often can’t resist and the result is a higher sale value. Some examples you may see regularly are:
- Your local coffee shop offering a ‘Coffee and Cake’ deal
- Buy 1 of Product X (or 2, or 3) and get the 2nd (3rd or 4th) for free (or half price)
- Spend $5 in store and receive an extra 2 cents/litre off your petrol
4. Bulk Purchase Discount
The final and fourth tactic which is really a subtle variation on some of the above is to offer a discount or other incentive for bulk purchasing. This is similar to upselling but instead of just one additional product, you are encouraging customers to buy in bulk. This will greatly increase the sale value, but is not suitable for all businesses and products. Again, the offering must represent enough value to the customer for it to be successful. Some examples include:
- Buy 5 reams of paper instead of 1 and get 10% off.
- Purchase $300 worth of products and get free delivery.
Utilising some or all of these four tactics in your business will lead to an increase in sales and grow your business. Try different options, test and measure to see what works best and be creative.
Until next time (and the final strategy),
Samantha
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