Make Exponential Profits With Backend Sales-Part 1
Make Exponential Profits With Backend Sales-Part 1
What is a Backend Product?
In this series I will be discussing an very powerful concept that if you implement in your business, you will see dramatic results!
No matter what type of business you are in, or whether you market your products online or offline, the backend offers are the ones which determine whether you are going to make marginal or staggering profits.
Many business owners seldom realize how important reselling their existing customers is. They solely focus on acquiring as many new customers as possible. They fail to understand how revolutionary the backend marketing concept is.
We must keep in mind that a ‘backend’ is different from an ‘upsell’, and not confuse the two. The products or services you provide your customers with after the initial sale are referred to as ‘backend’. These products and services can be your own as well as of others, which you will be reselling. Usually initial sales are followed by backend offers after a certain time lapse.
On the other hand, the additional products and services that are offered to customers while selling something and before the sale has been completed is known as ‘upsell’…..just like at McDonalds…”would you like fries with your order”?.
Think about how you can start using this in your business today!
Why Is The Money In The Backend?
Think of it like this: you already did what you did and spent what you spent to get your last customer....now with proper follow up tools and systems, you can "monetize" that list with backend sales to boost profit.
The reasons why applying the backend concept in your business can ensure unlimited profit are as follows:
There will be no customer acquisition cost, as you will be selling to customers you have already acquired.
You can cash in on your goodwill… If you have properly established a firm relationship of trust between you and your customer, as general statistics show, about 35% of your customers will purchase from you again.
For example:
Suppose you sell information products.
Assume that the selling price of your initial product (frontend) is $97, while its original cost price is $30. You run an advertisement for $600, which got you ten customers.
Your gross profit will be $670 ($97 X 10 customers) - ($30 X 10 customers), while your net profit will be $70 ($670 gross profit - $600 ad costs) for 10 customers.
Without having applied the ‘backend’ concept, your net profit would only have been $70 for 10 customers. However, if you offer these 10 customers with the backend product or service, which gets sold for $250 a few days later, and 30% of these customers take it on average, you will make another $750($250 X 3 customers). Overall, you will make a profit of $820.
This is an example of how powerful the ‘backend’ concept can prove to be. Even if you do not make profit from your initial sale, you can make it up from your ‘backend’ sale.
The backend concept can really help you to raise your profit margin by several notches. Keep supplying your existing customers with additional product offers, as money really lies in backend sale.
The Importance of a Backend Strategy
When you start thinking about your sales and profits, you’re likely to think that you need to create many and varied items for the backend. But you’ll find that you need to take an approach that is going to leverage your lists of products when anyone buys any of those products.
First, consider putting some polish on your current products and also the “experience” your customer has while going through your sales and buying process Next, you need to develop a backend product which is related to your front-end product, be it an accompaniment or complementary.
Then, when this second product is ready, announce it to your list of existing customers, who have already brought your first product. If they liked it, they’re very likely to purchase the new product, which is likely to suit their needs as well.
In fact, the saying, “there’s gold in the list” is often used to refer to the many marketers who have built vast fortunes and created multi-million dollar empires by selling, not similar things to different customers, but different things to the same clientele.
You need to do several things:
First, you need to keep every customer for life. Even if an investment of $50 can get you a paying customer, it’s more desirable, evidently, to make a $10,000 profit off him/her over the years rather than a one-time $47 profit.
You should also create an efficient backend strategy for your information products which is tailored to your customers’ needs. Pick their brains without letting them know that it is simply for product-creating. As Seth Godin say’s in “Meatball Sundae” you need to focus on what your customers NEED and then go out and sell it to them!
This should actually be rather easy. People like being asked for their opinion—creating a poll or questionnaire and mailing it to your list should garner you a lot of information about what your customers want.
And while your follow-up products are being created, continue supplying questions and/or useful information to your clientele, so they don’t feel used.
Remember, don’t constantly send them sales-pitches. Once their names are added to your list, start sending them some bits of helpful information that they can access for free. Once they’ve begun to somewhat trust you, and you’ve proven that you’re working in their best interest, they’ll not mind buying from you again and again.
If you’ve gained the trust of your clientele, they’ll help you profit over the years. You merely need to discover what they want and over-deliver with the products you create for them.
Make Exponential Profits With Backend SalesPart 1 - To learn more about this author, visit Mike Saunders's Website.
Like this article? Share it with your friends
Make Exponential Profits with Backend Sales-Part 1
What is a Backend Product?
In this series I will be discussing an very powerful concept that if you implement in your business, you will see dramatic results!
No matter what type of business you are in, or whether you market your products online or offline, the backend offers are the ones which determine whether you are going to make marginal or staggering profits.
Many business owners seldom realize how important reselling their existing customers is. They solely focus on acquiring as many new customers as possible. They fail to understand how revolutionary the backend marketing concept is.
We must keep in mind that a ‘backend’ is different from an ‘upsell’, and not confuse the two. The products or services you provide your customers with after the initial sale are referred to as ‘backend’. These products and services can be your own as well as of others, which you will be reselling. Usually initial sales are followed by backend offers after a certain time lapse.
On the other hand, the additional products and services that are offered to customers while selling something and before the sale has been completed is known as ‘upsell’…..just like at McDonalds…”would you like fries with your order”?.
Think about how you can start using this in your business today!
Why Is The Money In The Backend?
Think of it like this: you already did what you did and spent what you spent to get your last customer....now with proper follow up tools and systems, you can "monetize" that list with backend sales to boost profit.
The reasons why applying the backend concept in your business can ensure unlimited profit are as follows:
There will be no customer acquisition cost, as you will be selling to customers you have already acquired.
You can cash in on your goodwill… If you have properly established a firm relationship of trust between you and your customer, as general statistics show, about 35% of your customers will purchase from you again.
For example:
Suppose you sell information products.
Assume that the selling price of your initial product (frontend) is $97, while its original cost price is $30. You run an advertisement for $600, which got you ten customers.
Your gross profit will be $670 ($97 X 10 customers) - ($30 X 10 customers), while your net profit will be $70 ($670 gross profit - $600 ad costs) for 10 customers.
Without having applied the ‘backend’ concept, your net profit would only have been $70 for 10 customers. However, if you offer these 10 customers with the backend product or service, which gets sold for $250 a few days later, and 30% of these customers take it on average, you will make another $750($250 X 3 customers). Overall, you will make a profit of $820.
This is an example of how powerful the ‘backend’ concept can prove to be. Even if you do not make profit from your initial sale, you can make it up from your ‘backend’ sale.
The backend concept can really help you to raise your profit margin by several notches. Keep supplying your existing customers with additional product offers, as money really lies in backend sale.
The Importance of a Backend Strategy
When you start thinking about your sales and profits, you’re likely to think that you need to create many and varied items for the backend. But you’ll find that you need to take an approach that is going to leverage your lists of products when anyone buys any of those products.
First, consider putting some polish on your current products and also the “experience” your customer has while going through your sales and buying process Next, you need to develop a backend product which is related to your front-end product, be it an accompaniment or complementary.
Then, when this second product is ready, announce it to your list of existing customers, who have already brought your first product. If they liked it, they’re very likely to purchase the new product, which is likely to suit their needs as well.
In fact, the saying, “there’s gold in the list” is often used to refer to the many marketers who have built vast fortunes and created multi-million dollar empires by selling, not similar things to different customers, but different things to the same clientele.
You need to do several things:
First, you need to keep every customer for life. Even if an investment of $50 can get you a paying customer, it’s more desirable, evidently, to make a $10,000 profit off him/her over the years rather than a one-time $47 profit.
You should also create an efficient backend strategy for your information products which is tailored to your customers’ needs. Pick their brains without letting them know that it is simply for product-creating. As Seth Godin say’s in “Meatball Sundae” you need to focus on what your customers NEED and then go out and sell it to them!
This should actually be rather easy. People like being asked for their opinion—creating a poll or questionnaire and mailing it to your list should garner you a lot of information about what your customers want.
And while your follow-up products are being created, continue supplying questions and/or useful information to your clientele, so they don’t feel used.
Remember, don’t constantly send them sales-pitches. Once their names are added to your list, start sending them some bits of helpful information that they can access for free. Once they’ve begun to somewhat trust you, and you’ve proven that you’re working in their best interest, they’ll not mind buying from you again and again.
If you’ve gained the trust of your clientele, they’ll help you profit over the years. You merely need to discover what they want and over-deliver with the products you create for them.
Make Exponential Profits With Backend SalesPart 1 - To learn more about this author, visit Mike Saunders's Website.
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Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
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George LudwigGeorge Ludwig is a recognized authority on sales strategy and peak performance psychology. An international speaker, trainer, and corporate consultant, he helps clients like Johnson & Johnson, Abbott Laboratories, Northwestern Mutual, CIGNA, and numerous others improve sales force effectiveness and performance. Though it's George's strategies and processes that help corporations increase productivity and performance, it's his tremendous energy and dynamism that spark the transformation. Again and again, clients remark on his amazing ability to unleash human capacity and inspire men and women to break out of their comfort zones. The result is a whole new type of salesperson. His customized presentations teach achievers to make stunning advances in their lives. From helping salespeople realize cherished dreams to helping corporations exponentially accelerate revenue streams, George Ludwig leaves audiences and individuals empowered, emboldened, and clamoring for more. George is the best-selling author of Power Selling: Seven Strategies for Cracking the Sales Code and Wise Moves: 60 Quick Tips to Improve Your Position in Life & Business. - Visit George Ludwig's Website |
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