March 29, 2006Volume 5 Number 13 Issue 100     
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Back End Selling

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Today, I am unveiling the new site for The Great Ideazine. My wife felt that it was important that we take a short trip (3 days) down to Duluth to pick up some odds'n sods and to take a break. I picked up a couple of items I had not seen at home, so the trip was valuable *8>)

Of course this little trip did eat into my development time, and so the site is not as complete as I had planned, but I want to celebrate issue 100 with the unveiling of the new site!

Take a look around. Let me know what you like, and of course send me any suggestions for improvements.

Be sure to check out the Idea Vault - the login and password are in your email with the link to this newsletter.

Back End Selling

In this article I will review the principles of selling to your existing customers, also known as second tier marketing or back end sales. I will also discuss how to cross-market and find potential customers that you may not have been aware of.

The Importance of Back-end Selling.

You must put in a great deal of effort to get customers to even look at your products. You design killer web pages, work hard for high search engine rankings (or pay for them), submit classified ads, send out a newsletter, etc. but still do not manage to sell enough to make the effort worthwhile. This is where the concept of back-end sales shines.

Most successful marketers succeed because they insert back-end selling into their marketing efforts. Back-end sales are made by offering to sell other solutions (products or services) to your existing customers after they have purchased an initial solution (product).

It is always easier to sell products or services to your existing customers because you have developed a relationship with them when you sold your first product or service to them. You did send them an email thanking them for their business and reinforcing your guarantee, didn’t you? You will find it less expensive to sell to old customers as compared to selling to new customers.

Your conversion ratio will be dramatically higher with existing customers. Every time you offer to sell back-end products or services to existing customers, you are building a lifelong relationship. You should continually bring out new back-end products or services to sell to existing customers.

Loss Leaders

Many businesses sell their front-end products (initial products) at zero, or almost zero profit in order to generate the chance for back-end profits. These businesses do not care even if they lose money on the front-end products or services (loss leaders); they want the opportunity for many profitable future back-end sales.

How do you make back-end sales? There are several ways you might consider.

When you order a product from a mail-order company, they'll invariably send you a catalogue along with your order; or put you on a mailing list and send you new catalogues from time to time. They might also send you a sales letter for another product. This is usually related to the first product in some way. Many companies implement such a strategy.

To implement this technique on the web, you can put the sales pitch for your back-end item in the email to the customer to confirm their order. If you have an online catalogue, you should include a link to it, or even include a coupon or special offer "for all valued customers.”

For a faster response, you should put the back-end offer on the "Thank You" page that is generated by a credit-card sale. The customer just bought something from you and has a credit card in his or her hot little hand! Why not ask for another purchase while they are in the mood to buy?

If you do not sell more than one product or service, affiliate programs ae a great source of products. This way you can back sell products promoted by your affiliate programs as well.

Back-end selling can also be integrated with “Up-Selling” wherein you introduce more expensive products or services to your existing customers in similar ways to those mentioned above. This will almost instantly raise your sales and profits.

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Cross Selling

Another successful strategy similar to back-end selling discussed above is Cross Selling. One of the best examples of cross selling via the web is on Amazon.com. If you search for a book on the Amazon site, a message will appear on the same page, saying 'Customers who bought this book also bought…' and will list half a dozen other books for your consideration. This is an excellent way to cross sell additional services or content to your members.

You can also direct visitors to other parts of the site, to consider products and services that they hadn't previously considered. Successful cross selling is the result of recognizing a customer need and meeting that need with a useful product or service. Customers benefit from needs-based cross selling efforts because they receive the services they need and want.

Cross selling can help your business realize its objectives: providing useful services, retaining customers, attracting new customers, and staying competitive with other web sites.

In conclusion, you can offer a range of products and services on the Internet, but unless you capture sufficient sales, all if for nought. The key is proper research, a great marketing plan that includes back-end sales, and products that solve your customers’ problems.

Until next time…

warmly,
Jim Green

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