To be able to optimize out marketing campaigns to existing customers, we need to make sure we have all the data required to be successful.

As I have mentioned before, you need to track all customer sales in a database, whether it be in a simple excel spreadsheet or a CRM tool, it doesn’t really matter.

The basic information to track is as follows.

• Customer Name

We need this purely for identification purposes.

• Customer Contact Details. Tel cell and mailing address

We use the contact details to be able to keep up regular communications with customers for follow up marketing purposes. The more contact details the better. Contacting customers via all available contact methods maximizes the results we receive from our follow up marketing.

• Customer demographics (if available): Gender, Age, Industry Etc.

Example, a health business person, you have an easy excuse to collect age and gender as this fits with knowledge required by health professionals.

Base on demographics, we can easily tell what the best method and products we will target when marketing to these customers. Women for example will respond to different products or marketing messages then men.

• First purchase date.

This data is required for us to track the purchase frequency of this customer

• First purchase product name

Product purchased allows us to tell what type of products this customer prefers, and allows us to market complementary or advanced version of similar products to them.

• First Purchase Spend

This purchase spend allows us to track the value of each customer over a period of time. This ties into the lifetime customer value as discussed in the last article.

• Second Purchase Date etc.
• Second Purchase Product Name etc.
• Second Purchase Spend etc.

So how do we use this data?

First of all we will be using this data to analyze and group our customers based on frequency of purchases, total spend, and over what period of time this occurred.

In any business, you will always have your loyal rabid customers who will trust almost anything you say and buy anything you sell.

From the above data we want to determine our top 20% of customers buy determining who purchases the most from us over the least period of time.

You can chart your customers over a time period, say 4 months, and from this chart you can see which top 20 customers have purchased the most from you within this 4 month period

We then want to spend the majority of our time and cultivating these customers and building a good relationship and marketing to them.

It’s been proven time and time again that your top 20% of customers are responsible for 80% of your revenue so you make the ultimate best use of your time focusing the majority your efforts on these customers.

In the other side of the coin its worth mentioning that 80% of headaches and support issues and waste of time communications come from your bottom 20% of customers. So you can cut away most of the time wasting tasks by trimming out our bottom customers, giving you more time to focus on your top ones. Some customers are simply not worth the time spent on them!

So simply tracking the above data, you can easily increase your profits by knowing where to focus your attention and marketing efforts/spend, as well as drastically reducing time wasters by trimming out certain customers who are not worth keeping on.

Right now, im going to start of with a quick example of a back end sales funnel:

As a personal fitness trainer, your core business may be a once-a-week fitness training session, which is what you market and sell to new prospects.

Most personal trainers and other health professionals will only focus on their core offering, and will never realize they now have a customer who has already put their trust in them, and are now prime targets for additional sales!

So, on week 2 at the end of the first session, you may discuss diet with your training customer, whereby you will recommend a great weight loss product that will maximize the results they receive from your fitness service.

Naturally, they can get this product directly from you, or they can purchase it from www.XXX.com (your special internet link whereby you generate commission on every sale).

On week 3, you can now mention to them that they are now ready to go onto the next level of supplementation, so you recommend product B.

On week 4, you mention that you know of an excellent book on dieting that has helped you get to where you are right now, and by following it as well as continuing to take the 2 supplements, they would get excellent results in combination with your training services.

This book and be purchased at www.XXX.com, another special link which generates you commission with every sale.

This is a very simple back end sales process for a fitness professional.

So, lets do some math:

Previously, let’s say the customer was spending R100 per day (1 hour session) for training, or R400 monthly.

Let’s say you have 30 training customers a month.

That’s R12000 per month you get for your fitness training.

Now, if you had implemented your backend process correctly, its easy to get an average of 40% to accept your back end offers.

That’s 12 customers who purchase the two supplements in month 1, as well as the book.

Supplement 1 makes you R100 commission

Supplement 2 makes you R80 commission.

Book makes you $120 commission.

That’s R300 for each of the 12 customers that accepted the other offers, each month.

So 12 customers R300 = R3600.00 additional for that month for only a small bit of time invested in recommending the products to your customers, at no additional cost to you.

Additionally, if the customer keeps purchasing supplement 1 and 2 each month you will get $35 per customer the following months as well.

Not bad eh?

The back end sales funnel can be very powerful and I recommend you experiment as much as possible with making additional offers to existing customers. Obviously each business is very different and you may think this is not possible in your business but I can tell you this is not the case. There is always opportunity to grow a back end in any business.

One important thing to note. You will see from my example that the additional offers to customers were made in the form of a recommendation.

This is very powerful. Remember in the introduction I mentioned that once the customer has already made 1 purchase from you, you now have their trust.

Well, this means that any recommendation you make for an additional product or service that may help them is now coming from somebody they now trust and thus you can expect a very high percentage of them to go with the recommendation.

Actions:

1. Sit down and consider your current customer base. What additional products or services do you think will complement (not compete!) with your current offering. What other products or services are targeted at your specific group of customers?
2. Once you have developed this list, are there any products or services you can offer them directly. Perhaps a new service you can create?

Remember, it is usually more profitable to offer them your own services or products, then it is recommending another service or product for a referral or commission fee.

1. Finally review your current business and customers and try and find points in time and opportunities to make your recommendations.

It’s important to note right now that an offer sooner than later is more likely to result in a sale, as customers are more likely to make another purchase very soon after the last one.

Backend offer 1 and 2 should ideally be made within the first month of the initial offer, after then your conversion will go down.

In the next few articles, we will look at the different types of backend offers and strategies you can employ.