Every business experience ups and downs – the key is to know how to turn the curve around when you’re experiencing a downward slump and increasing your revenue is one of the most obvious ways to achieve just that.
Let’s look at four ways that you can increase your revenue.
The first two tactics are low-hanging fruit. The easiest way to increase your revenue is by generating more income from existing customers. It’s an easy sell because you’ve already helped them and built a relationship with them, so they will be more likely to say yes. Compare that with someone who doesn’t know you or your products yet. Not only is it more difficult to get a new lead to say yes, it’s also more expensive to attract them.
Let’s look at how you can increase revenue from existing clients:
1. Increase the Value of Each Transaction
Every time your customer buys from you, try to increase the number of products that they purchase or convince them to sign up for the high-end service package instead of the basic. There are two techniques to increase the value of each transaction:
Upselling is when you convince clients to sign up for a more expensive package or to buy a more expensive product. Let’s say a customer comes in to buy a new phone and he’s looking at an older version. You can suggest that he buys the latest phone that just came out instead and you can highlight the new features to demonstrate why it is a good deal. If you offer services, you can convince clients to rather sign up for the platinum package – instead of the basic – by emphasising the benefits of the upgrade. As a result, your customers will get more value, and you will make more money.
Cross-selling is when you convince customers to add more things to their bill by offering complementary products or services. Let’s say your customer bought a new couch. You can now suggest that they purchase new cushions, a carpet, and a vase for the coffee table that fits in with the new furniture. If you’re a hairdresser, you can ask your clients if they want to add a hair treatment or to consider colouring their hair when they come in for a haircut.
2. Get Customers to Buy from You More Often
Another great way to increase your revenue from existing customers is to convince them to buy from you more often. You can do this by offering loyalty programs and, of course, outstanding customer service.
A good example is a coffee shop that offers a loyalty program to customers where they get the 10th cup of coffee for free. Customers that like this particular coffee shop’s beverages – and service – will drive a few extra kilometres just to get the little stamp on their loyalty card.
Customer service is key if you want them to visit your more often. If they always get excellent treatment from you, they won’t even consider going to a competitor. If you remember their names, their purchase history, and their interests, they’ll feel special and will be loyal to your brand.
3. Attract More Customers
The more people you can bring in the door, the more money you can make. This is often the hardest part, and you need to spend money and time to attract new leads and customers. But it’s something you can’t ignore if you want to increase your customer base and grow your business.
So, how do you do it? You can do it through investing in branding, marketing, advertising, increasing the number of sales calls you have with prospective clients, and offering specials to new customers.
4. Increase Your Sales Prices
Lastly, you can also increase your prices. You’ll make more on every transaction, while your amount of effort stays the same. Your revenue will increase – provided that the sales volume remain the same.
Raising prices is an inevitable part of doing business. People expect that you would raise your prices from time to time. Sometimes we don’t have a choice – the latest petrol price hike – but at other times we need to raise our prices because the value of what we offer or the quality of our products increased.
Don’t take price increases lightly, though. Be sensitive to what the market can afford. If you increase your prices by too much, you may lose valuable clients or see a dip in your sales.
Which Revenue Increase Tactic Are You Going to Implement?
Although there’s value in all four tactics, we suggest that you focus on the first two tactics first, as these will be the quickest ways to increase revenue. Make a list of ways that you can increase income from your existing customers. Are there complimentary products or services that you can offer? Can you offer a more valuable package?
Get in touch if you feel stuck and need to brainstorm some ideas to increase your revenue.