Double your Sales by Doubling your Customers

by John Almberg, Identry LLC, September 2007

We've been talking about an online marketing system called “Selling by the Numbers”. If you missed the previous articles, you can catch up at www.identry.com/newsletters.html, but the key idea is V=>P=>C=>S, or visitors give you prospects give you customers give you sales.

Last month, we looked at converting anonymous Web site visitors into prospects. This month, we'll focus on the next step – converting prospects into customers.

“That sounds like a lot of work,” said one of my clients, who I'll call Jill. “Why would I want to do that?”

Because it costs money to generate prospects. Sometimes lots of money. And if you don't follow up, it's probably money down the drain.

For example, suppose you pay $1000 for a display ad in a magazine. Assume the ad generates 40 Web site visitors. If 4 of those visitors become prospects, then each prospect cost you $250 – not an untypical figure.

Whatever the number, one thing is certain: prospects always cost you money. When you measure the results of your marketing, and can put a dollar figure on prospects, you'll know exactly why you need to follow up.

Step 1: Baseline your numbers

Before you can double your prospect-to-customer conversion rate, you need to know what it is, now. It's an easy number to calculate: it's the number of prospects your Web site generates, divided into the number of customers you convert, multiplied by 100%.

For example, if your Web site generates an average of 8 prospects a month, and you convert 1 of them into a customer, then your conversion rate is 1/8 * 100%  or 12.5%.

As always, you want to baseline this number so you can measure your progress. Don't skip this step!

Step 2: Follow up

There's another reason you should follow up with your prospects. In an earlier article, we talked about positioning – owning a word in your customer's mind, like 'graded stamps' or 'fancy cancels'.

Google, for example, owns the word “search engine” in most people's minds these days. More to the point, they own the word “helpful search engine”, or maybe “easiest search engine to use”.

You don't want to just own the word “stamp dealer” in your customer's mind. You want to own the word “helpful stamp dealer”, or “easiest stamp dealer to work with”. One way to help to do that is to follow up, because so few of your competitors will.

“I'd like to follow up,” said Jill. “But I don't have the time!”

Exactly. It's easy to follow up with 2 or 3 people. Nearly impossible with 200 or 300 people. That's where automation can help.

For example, many dealers generate prospect lists by collecting interests, particularly at shows. You'll often see a clip board on the dealer's table, asking for your name, email address, and your main interests. Helena and I go to lots of shows – stamp, coin, autograph, book, ephemera, you name it. I've probably put my name on 30 lists like this, but few dealers ever followed up. Probably because it's just too much work.

But what if a dealer could put my name, email, and interests in a database? Then he could delegate to a computer the job of letting me know when new inventory matched my interests. With automation, he could follow up with hundreds, or even thousands of prospects.

For another example, Jill generates prospects by allowing visitors to sign up to receive her monthly 'Buy Lists' by email. She segments these Buy List by categories, so prospects get just the information they want. It used to be a lot of work to manage these separate email lists manually, but now Jill uses an automated package that handles subscriptions, un-subscriptions, bounced emails, and sending the right Buy Lists to the right people. Automation reduced this monthly job from 6 hours to 30 minutes. More importantly, it let her expand her prospect list from a handful, to over 2100.

There are lots of thing you can do to follow up with prospects, but the general idea is simple:

  • anticipate what goals your visitors want to accomplish on your Web site
  • convert them to prospects by allowing them to sign up to receive information or a service that helps them accomplish those goals
  • use automation to deliver that information or service
  • keep following up until you've converted that prospect into a friend, and the friend into a customer

Step 3: Measure your results!

To know which follow up activities are profitable, you need to measure your results. Automation can help here, too. Delegate this job to a computer so you'll always know what's working, and what's not. That way, you can do more of the profitable stuff and less of the unprofitable.

Remember: marketing should be an investment, not a gamble. Measuring makes the difference.

Next month, we'll look another way Jill could double her sales: by doubling the value of her customers. Meanwhile, please send any questions or comments to john@identry.com, or visit us at www.identry.com. And have a great month Selling on the Web!