How To Get Your Customers
To Spend More Money With You
Every Time They Buy!
----------------------------
This is one of the most powerful profit-building concepts
you'll ever learn. So, learn it well.
The reason this step is so important is that once the
customer has already decided to do business with you, he or
she already trusts you (at least a little bit). And when
you get them to make a purchase, they have to relax their
grip on the purse strings. And while the purse is open,
it's easy to get them to dig a little deeper.
Look at it this way. You've already spent the money to
acquire this customer, so any additional sales automatically
have a higher profit margin than the original sale.
You've got no marketing expense associated with the
additional sale.
And the customer is in a buying mood!
Two of the best techniques for this are The Bump and The
Upsell
Let's start with a perfect example of The Bump. Have you
ever been to McDonald's?
That's probably a silly question, but believe it or not,
Brad has a friend who's in his mid-forties and claims to
have never eaten at a McDonald's.
He may be the only person in the country who can say that.
Anyway, next time you go to a McDonald's, order a sandwich
and drink (but no fries) and see what happens.
You'll personally experience a simple, ridiculously easy,
million-dollar bump.
That's right. McDonald's has made untold millions of
dollars with the most simple bump of all.
You see, if you place an order that doesn't include french
fries, the counter person will immediately and cheerfully
suggest some hot, delicious fries.
And, if you're anything like the rest of us, you'll probably
have him or her add fries to your order.
Just the mere suggestion causes a certain percentage of
people to go ahead and order the fries.
And we're not talking about a few isolated cases, either.
One contact we know told us that between a third and three
quarters of the people who don't initially order fries, add
them on.
Does this really add up to anything?
Let's take a look. Let's say an order of fries sells for
about eighty cents and costs about a dime. These are
guesses, but they're close enough for our example. Further,
say that an average of 200 people a day at each McDonald's
don't initially order fries.
If only half of them add the fries (100 people), that means
each McDonald's just added $80 per day to its sales and $70
per day to its profits.
Multiply that for a whole year and it's $29,200 in sales and
$25,550 in profits.
Now, there are about ten thousand McDonald's in the U.S., so
that adds up to $292,000,000 in extra sales and $255,500,000
in extra profits from this one little bump. And all they do
is make a simple little suggestion.
Let's look at a few more examples of effective bumps and
then start thinking about how you can use this hot technique
to bump up your own profits.
Back when we were in the video business, we used bumps and
upsells very effectively. One example is whenever someone
bought a new VCR, our salespeople would simply ask whether
they wanted three or four video tapes to start with.
They almost always bought three.
Why did we offer them three or four?
Well, we found through testing that if we offered one or
two, they usually bought one. If we offered two or three,
they usually bought two.
But, if we offered four or five, they often went all the way
down to one. That probably means that we tried for too big
a bump.
You see, back then video tapes were around $20 each so five
tapes was a hundred-dollar bump. That's a bit more than an
eighty cent order of fries, isn't it?
Let's bump a little bit more.
Have you ever bought new furniture without the salesman
asking you to add on the Scotchguard stain protection?
Probably not.
That's because when you buy a thousand-dollar sofa, it's not
very hard to convince you to add stain protection for only
fifty or a hundred dollars.
Our sources in the furniture business tell us that about 80%
of their customers buy the bump and that it costs them
peanuts to do the service.
In fact, they say that it's almost all profit. What if a
furniture store sells five major pieces a day and they're
open about three hundred and sixty days a year. If they add
$75 profit to each of these sales it adds about $135,000 a
year to the bottom line.
Remember, this technique costs nothing, and doesn't even
require any kind of a hard sell. Simply suggest the
appropriate option to what the customer has already decided
to buy.
It's basically a numbers game. Even with just a mere
suggestion of the bump, a certain percentage of the people
are going to buy it. No muss, no fuss, just added profit.
Car salesmen are experts at the bump. Most people, when
they buy a new car, negotiate their best deal. Then, after
the deal is struck, the salesman suggests such things as
additional options, rustproofing, service contracts, etc.
By the time the customer signs the final papers and takes
delivery of the car, the price is often several hundred (or
thousand) dollars higher than the original deal.
Want to make your bump even more profitable? Of course you
do. After all, we're talking about doubling your business,
aren't we?
Try this. When you decide on the option or accessory to use
for your bump, offer it at a reduced price.
Explain to customers how much more enjoyment or usefulness
they'll get from the widget they just bought if they also
have a gadget to go with it.
Tell them the gadget usually sells for X dollars, but they
can add it to their purchase today for only Y dollars.
Point out that eventually they'll want to add it anyway, and
that if they wait, they'll have to pay the regular price.
Generally, this approach bumps enough more people to more
than make up for the discounted price on the gadget.
Here's an important concept that you should always remember,
everybody loves a special deal. Therefore, you can often
use something that's only loosely related to the customer's
purchase for a bump.
Offer a special discount on something the customer may want
in the future.
If the bump is something that doesn't become stale, dated,
or obsolete quickly, many customers will buy it just to get
the savings even though they may not need it right away.
Of course, you don't have to be in a retail or service
business to use a bump. It's an extremely powerful
technique in mail order too.
Why not add a bump to a powerful sales letter? The
technique is the same.
Once the reader is salivating to get all the wonderful
benefits of your main product, offer a little bonus if they
also add the bump.
If you do follow-up telemarketing with your mail order
sales, the telemarketer is in a perfect position to offer a
bump.
Major mail order companies are expert at this. They know
how much additional profit it represents.
Now get out a legal pad and start brainstorming what you can
use for bumps in your business.
List all the various options and accessories available for
your main products.
List any and all additional services you can add to your
main service.
List any (even loosely) related products you could provide
to your current customers.
List everything that comes to mind -- even if it doesn't
make sense right away. You see, many times a ridiculous
suggestion can lead the way to something quite workable.
Let your creative juices flow.
Finally, think about any informational products you could
create to complement the products and services you sell.
Information products are incredibly profitable and carry
high perceived value. You could probably produce a series
of reports, or manuals, or how-to materials which your
customers would love.
Also, consider creating your own audio or videotape sets to
use as both main products and bumps. They carry an enormous
perceived value and cost peanuts to produce.
Now, let's look at another great way to get your customers
to increase the size of their order.
It's called The Upsell.
An upsell is related to the bump, but it's a slightly bigger
step. In this case, you're going to sell some of your
customers a bigger or better item instead of (or in addition
to) adding a bump.
Simply show the customer a widget that's better, bigger, or
faster than the one he or she was considering -- but with
some special consideration such as a substantial discount,
more favorable payment terms, extra options, or accessories.
If you become known as a business that delivers incredible
values, you can't lose. Remember, people can't resist a
bargain.
Offer to sell the higher-priced model with a larger discount
than the moderately priced one. Everybody wins here. The
customer gets a much better value, and you get a bigger
sale.
You're taking a smaller percentage of profit on the higher
sale, but you're probably making more actual dollars. Plus,
the customer is usually thrilled with the great deal.
That's where the magic comes in.
Make certain the customer is happy. Don't try to sell the
customer something that's way out of their price range.
They'll end up resenting you for it. Don't get greedy!
A long time ago, Brad made his first (of very few) stock
market investments. He bought a stock recommended by a
friend. From the moment he bought it, the stock started
steadily rising.
This excited Brad so he bought more. And then more. And
even still more.
Soon, he had quite a bit of money invested in the stock. It
was still climbing, and Brad had already doubled his money.
Do you think Brad decided to sell some of his stock, take
some profit, and reduce his risk?
No way. He was going to make a killing.
What do you think happened? That's right, the stock tumbled
in a short time and Brad ended up losing even more than his
entire original investment.
He learned a valuable lesson...
Bulls make money and bears make money, but pigs get
slaughtered!
The same is true with your upsell. If you get greedy and
try to "bleed" your customers, you'll end up losing big in
the long run.
Of course, you don't want to go to the other extreme either.
Don't be afraid to sell your customers things which will
benefit them. Offer them terrific values without trying to
suck them dry and you'll make a fortune.
The upsell can be as simple as moving the customer to the
next better (more expensive) model. A certain percentage of
customers are going to easily move up and spend more money.
That's added profit.
Or, you can create a deluxe package of products or services
that includes a better model. The package deal is much
better than the regular deal so many customers will buy it.
Or you could do a "buy two get three" sale. Some people
would call this a bump, others would call it an upsell.
Either way, it means more profit to you, and a better deal
for the customer.
Don't confuse an upsell with "bait and switch." They are
entirely different things. Bait and switch is a sleazy
tactic that some retailers use to lure customers into their
store and unscrupulously upsell them.
In these cases, the retailer advertises something at a
ridiculously low price to lure customers into the store.
There's nothing wrong with that, except that the retailer
then tells the customer they're out of stock on that item.
Sometimes, even if they have the item in stock, they use
high-pressure, intimidating sales practices to force the
customer to buy a more expensive model.
Don't do this! It's unethical and in many (if not all)
states, illegal!
And if your sense of ethics doesn't prevent you from trying
this, let your greed keep you honest.
It's been proven time and time again that practices like
this, although they may generate short-term profits, will
end up costing you far more in the long run. Customers,
even those who buy the more expensive item, end up feeling
cheated.
They won't be in a hurry to do more business with you, and
they'll spread the word to their friends. In the long run,
practices like this will put you out of business.
Does that mean that you shouldn't advertise low prices? Of
course not. It simply means that you should only advertise
what you're willing to sell.
Instead of bait and switch tactics, use step-up selling or
the upsell.
Here's how. Go ahead and advertise a great deal on a leader
item, but be ready to offer an even more enticing deal on a
more deluxe product.
When customers come in looking for the advertised special,
be polite, informative, and helpful. Treat them with
respect.
Point out that you do, in fact, have the advertised model in
stock and ready for immediate sale. Point out also that the
better model is also on sale and the savings on it are even
bigger.
Teach them the benefits of the better model and offer to
show it to them. Many of them will eagerly buy the more
expensive model and be glad you took the time to show it to
them.
The key is that you gave them great service and a great
deal. You're happy with a bigger sale and they're happy
with a better deal.
Another way to get customers to increase the size of their
orders is to make it easier for them to pay for them.
Offer as many easy-payment methods as you can. Offer
financing, credit cards, cash checks, layaway, and whatever
else you can think of.
The easier you make it for them to spend money with you the
more they'll spend.
Just like the bump, the upsell isn't confined to retail
stores. If you sell by mail and someone calls to order an
item, you can still perform the upsell.
If you're selling a book, upsell them to a home study
course. If you're selling a home study course, upsell them
to the version with audio or videotapes, or a package
including telephone support.
The possibilities are endless.