Business owners are oftentimes required to make certain changes to their business operations to achieve more profits, and in this era of the COVID-19 global pandemic, making these changes has become more urgent to ensure the survival and continuity of businesses.
To make this happen, business owners need to see to the deployment of certain strategies that can increase revenue and ultimately, increase the net profit of their businesses.
1. Lead generation and conversion
Lead generation is a process that is used to attract new prospects to a business. The process also aims at converting prospects to paying customers. Suppose your business has five paying customers already, you can use lead generation to increase the number of paying customers to ten and in so doing, double your profit.
Lead generation requires you to reassess your sales processes and methodology. A reassessment will show you areas where your sales effort is lacking, new sales tactics and channels that you can adopt, and new markets that you may have previously ignored. When all these are optimised, your sales conversion rate increases and so does your profit.
2. Optimising each transaction
When trying to increase revenue (and ultimately, profits), there are many things you can do. You can increase the price of your products or services, cut costs, increase the number of customers buying from you or increase the volume of sales you make to the same number of customers. The last option is sometimes the easiest and cheapest to implement immediately and it can be done by either upselling or cross-selling customers.
Upselling simply means encouraging customers to buy other products (some of which may be pricier) from you, than the one they would usually buy, while cross-selling tries to get customers to buy related or complementary items. Upselling and cross-selling make it easy for you to generate more revenue from the same number of customers without incurring additional marketing cost.
3. Adding value to your product or service
Again, one of the ways to increase revenue is to increase the price of your products or services but this is not always as easy to achieve as it sounds because most customers are averse to price increments especially in highly competitive markets and in times of economic decline.
One way to successfully increase the price of your products or services without losing your customers is to find ways to add value to your offering such that you clearly stand apart from competing brands. You can do this in many ways. Adding a complimentary item with a negligible cost, increasing the size or quantity of your product (or the scope of your service offering), offering after-sales service, and offering small incentives are some ways to differentiate your product (or service) from those of your competitors.
4. Reach a global audience
The world has become a global village and language translation services have made it easy for businesses to communicate with customers across different continents, cultures and languages. To target a wider range of customers from across the globe, it is expedient that you include language translation options on your website. When organizing digital events, make sure to provide remote interpreting in order to reach a multilingual audience. This level of localization will ensure that you are communicating your value proposition clearly to everyone in your audience.
5. Customer acquisition costs
Consider how much money you spend to acquire every paying customer. You need to continuously be on the lookout for creative ways to advertise and promote your business without significantly increasing your marketing cost.
To reduce your marketing spend, you can encourage your customers to refer your products or services to people in their network. You can offer customers a small discount or some other incentives with a negligible cost in exchange for referrals. You can also leverage social media networks to generate more leads for your business.
Developing a well-structured and functional referral system can increase your revenue exponentially within a short time frame.
Putting the simple strategies taught in this article to use and helping your team to do so can help you optimise your business processes for greater profitability.
Rachel Eleza, Growth Marketing Director at UpSuite and a part-time writer.