TristanGood

Improving profit margins can make or break your business. After all, if you’re putting in a lot of work, have high revenues, but low profit margins, you will still have trouble staying in business. Following these steps to improve your profit margin will go far in helping you create the business of your dreams that allows you to live your dreams too. 

1. Create Systems and Processes

No matter what type of business you have, it’s imperative to have systems and processes in place for everything. Automate everything you can, outsource things that aren’t in your wheelhouse, and use the technology that is available to you to make everything simpler.

For example, having the right autoresponder plus autoresponder series is part of the process of nurturing leads, retaining customers, and educating your audience. 

Creating the right filing system on your computer so you can easily find things is also part of a system. If you do things the same way each time (and yes, you can improve it as you go), it’s going to make many types of tasks faster and more effective. 

2. Upsell and Cross-Sell 

Using that system, add upselling and cross-selling to every single product or service that you promote. Even if you are promoting someone else’s product or service, you can still offer additional value to them for making a purchase via content upgrades, prizes, and more. 

By increasing the average order total, you’ll increase your ROI exponentially. Be careful about adding too many, though. You may need to test it for your audience as each audience is different, but one or two and even three upsell offers can make a huge difference. 

3. Cut Low-Margin Products/Services

Track the numbers so that you can discover what you’re doing that’s making you the most return on your investment. If you have low-margin products and services that take a lot of time, ask yourself what would happen if you spent that time on the products and services that have a higher return. More than likely you could increase profits by simply switching efforts to do more marketing for the high-return items, and less for the low-return items.

4. Nurture Your Customers

When someone buys from you, they’re much more likely to buy from you again. Therefore, set up automation to sell new products and services to the people who have bought from you that you believe they need or will like. This doesn’t even take that much work if you really know your audience, your product offerings, and are good at finding other people’s products to fill in the gaps. 

5. Track Your Expenses

How many monthly fees do you pay for things that you really don’t use often? Automation and software are wonderful, but if you’re not using something, then it’s just a waste of money and an added expense that you don’t need. If you’re using it every day, and you’re seeing a good return on the investment, keep using it. Otherwise, let it go. 

Plus, tracking your expenses and matching them to the products they help you promote, will ensure you don’t have expenses on the books you don’t need and which are lowering your profit margin.

There are many factors that make up your consumer insights. The more information that you can gather, the more you’ll be able to target your market. These insights will help you answer who your audience is, who your customer is, what they need, and more. 

There are many ways to gather consumer insights. You can collect information from numerous parts of your business. Social media, your website, and email marketing all come to mind regarding where to gather the information using native analytics software. You can also use Google Analytics to get even more insights. Once you have the software installed, consider the following.

• Customer Type – You probably have more than one type of customer that fits in with your ideal audience persona. It will help you to find out who they are using analytics with your social media, website visitors and more. This will help you create better-targeted marketing materials.
• Observe Real Time Behavior – You can use heat maps via Google Analytics to find out what your audience is doing real time. You can also observe what happens on social media, within the email, and information such as how long your audience stays on your website consuming the information that you provide.
• Communication with Customer Service – A good CSM will help you judge how well your customer service agents or virtual assistants are working with customers. You can view old conversations and find out what complaints there are and how to resolve them before it happens again.
• Note Personal Preferences – Using the systems at your fingertips, you can note what your audience prefers. For example, if you have a membership site and you have video as well as transcriptions for the video, which do most of your audience use? This can help you develop better information delivered in the right format.
• Reward Referrals – You can use analytics to find out where your traffic is coming from, which can enable you to do a couple of things. One, you can reward referrals and two, you can do more of what you did to get the referral. 
• Know the Favorite Parts of Your Website – You can use the analytics to help you figure out what pages are most viewed and for the longest time. This can inform future content that you create in very targeted ways.
• Understand Your Audiences’ Demographics – You may not realize how important demographics are, but what if you thought your audience was one thing and then you finally realized it was completely different? Your marketing messages will become more targeted and effective.

Understanding your customers more is going to help you boost your business to a whole new level. Plus, it’s not even that hard. Most platforms offer some form of native analytics that you can use to find out more about what your customers like and don’t like. Then you can use that information to keep improving.

One of the hardest things to do if you have a service-based business is to figure out what your fees should be. You have to realize that there are two types of value. One is economic based and one is perceived value. What you want to focus on when creating your pricing is the perceived value you offer to individuals.

Boost Your Perceived Value

You can boost your perceived value by becoming an expert in your niche and a go-to person for advice about your industry. You can do this by writing a book, blogging regularly, getting interviewed, giving interviews, going to live events and online events, hosting and attending and presenting at webinars, and more. 

In other words, the more visible you are, the more people will want to use you. And the more people want to use you, the more your value due to supply and demand.

Your Time Is Worth More

Most people start their pricing with an hourly rate commensurate with what others in their industry are charging. This is a good way to start. But it’s just a start. Do some research to find out what others are charging for the same service, then determine the value they deliver for the cost. Figure out ways to fill in the gaps in the services the others offer, which can boost your value tremendously.

Demand Affects Your Value

If you’re not yet in demand, it’s harder to stick to a higher price for your services. But, you want to create a perceived demand for your time by avoiding focusing on that right now. Instead, focus on building your business by filling in the gaps with other services that don’t take as much of your time, making anything involving one-on-one time your high priced item.

Experience Affects Your Value

If you’ve been in business for 20 years and have numerous connections to the industry, you’re simply going to be able to command a much higher fee. But remember, your clients get a lot more for their fee today than they did when you started, so it’s worth it. 

The Problems You Solve

These really affect your fees, because it matters what the solution is worth to your buyer. If your service helps your client earn multiple six figures, what percentage have you earned of that? Surely, if your help turns a $50K business into a $250K business, you’re worth 10 percent of that, right? That’s $20K from one client, which on a monthly basis would be worth $1667 a month. What can you offer to them that will be worth that?

Value Communication 

A lot of people fail with this part of the process. If you can’t communicate your value, it’ll be hard for you to justify your price. Incidentally, this works with information products, courses, coaching, and one-on-one services too. You need to be able to communicate how much in real dollars you’re worth, and why, to your potential clients. 

Client Segmentation

When you create your offer funnel it should include products, services, and help to everyone in every stage of the buying cycle, with the idea to push them all toward your most expensive one-on-one services. You can do that by segmenting your leads based on their behavior. Qualifying each potential client before you make your offer is imperative. 

So many people go into business with an employee mindset. Start thinking about the value you offer to your customers, and how you can improve that value. The more value you can offer and the more value you can prove that you offer, the more people will be willing to pay you happily. Wouldn’t you pay someone $10K today if you knew for a fact that if you did everything they said you’d make $250K from that investment?

Market segmentation is part of any successful sales strategy. It will drastically increase your bottom line if implemented correctly. First, let’s talk about what market segmentation is, and then we’ll go over the different ways it can improve your sales strategy.

What Is Market Segmentation?

Many small business owners make the mistake of casting a wide net. They want to get as many customers as possible, so it initially makes sense to them that going after more people will bring more business. 

But, the opposite is true. Even a large corporation with many stores (such as Walmart) uses market segmentation to create all their marketing programs, because going after a narrower audience works better. Therefore, market segmentation is going after a smaller portion of your audience, even the “audience of one”. 

What Are Different Types of Segmentation?

There are many types of segmentation and more than what will be listed here. Essentially, you can segment your audience in many ways, then market to each individual segment in different marketing campaigns. 

• Ensure Your Segment Is Identifiable – You should be able to describe the segment in minute detail. The more information you have about the segment, the better. What are their desires? How much money do they make? How much money can they spend? What type of thing makes them want to buy? What are their fears and pain points? 
• Ask Whether You Can Reach That Audience – Is there a method of communication that you can use to get to the segment you’ve chosen? Do they use email, mobile phones, computers, telephones and so forth? How will you get your message to them?
• Know If the Audience Is Large Enough – In each industry, there is a certain conversion rate you’ll want to drive toward. But, you need to know if the segment you’ve chosen to focus on has large enough numbers to make your financial goals a reality. No sales strategy will work if there aren’t enough people to buy.
• Understand the Unique Needs of the Segment – The more you can understand the needs and desires of each segment, the more you’ll succeed in your marketing efforts. For example, are you trying to market to professionals who have MBAs? If so, what is unique about the MBAs you want to target?
• You Can Also Segment by Obvious Sectors – Geographic, demographics, moral attitudes, and values are all good segments to start with when you set up your marketing campaigns. If you can match your values to the largest demographic in these cases, you can create a winning campaign. 

Once you determine the segment you want to target, you need ways to get to them. A good way to do that is to create a freebie to give away to the sector that you want to target in your sales strategy. You can create the freebie yourself or you can hire someone to do it for you. 

A good freebie should not be something you have to create fresh for each new potential customer, but instead a very targeted piece that you only create once for that audience and deliver inexpensively.

Statistics show that keeping a customer happy is a lot less expensive than getting a new customer. Therefore, it’s imperative to form a customer-centric attitude that you pass on to every part of your organization. 

1. Listen – You know the saying as well as anyone: “You have two ears and one mouth for a reason.” Well, it’s a good analogy for what you should do in any situation, not just business. Zip your lips and listen to what the customer has to say and you’ll see that they’ll calm down and give you just the way to help them.

2. Study Your Audience – You should always be conducting research on your audience. Audiences grow and change even while maintaining the same demographics over the years. Think about how different 25-year-olds are today from what they were in 1950. The more you know about them and their lives, the better you can serve them.

3. Get Feedback – You can nip some problems in the bud immediately simply by asking for feedback from customers as a matter of practice. Give your customers some time to enjoy their purchase, and then send them a survey asking for feedback. Use text that will let them know you want to improve your services or product and their input is essential to this process. Offer an incentive such as a discount, or a freebie such as a checklist or something to help them with their purchase in exchange for giving feedback.

4. Anticipate Needs – When you know your customers, you can anticipate the types of questions they’ll have and the types of products and or services they’ll need. In fact, you want to be able to know your audience so well that you only offer them things that they already want. Plus, it means you know the type of help they need to use your product or get the most from your services.

5. Treat Them Like VIPs – Once someone is your customer, you should treat them like very smart people or VIPs. This will make them feel special and it will cut down on problems. Give customers a special number to contact you, or a special email address or even a special text number to get help. 

6. Smile – Even if you’re talking to your customer on the telephone, it’s important to smile as you help them. Smiling releases endorphins that make you calmer and happier, thus enabling you to deal with even the most difficult customer in the best way. 

7. Answer Positively – Even when you have to say no about something, try to phrase it in a positive way. Instead of saying, “No we can’t give you a refund”, say something like, “I see what you mean, and we can offer you XYZ and ABC. How does that sound?”

8. Apologize – Always say that you’re sorry even if you’re not at fault. “I’m sorry” goes a long way to helping people calm themselves down if they’re upset about something. Often, people are upset even before contacting customer service, and will be taken off guard when you apologize fast and get to the problem instead of being defensive. 

9. Give – The more giving you can be during any type of customer support interaction, the more your audience will become loyal to you. Try to answer customers fast; and when it’s possible to give them what they want, do it. It will pay off. 

10. Train Customer Service Staff Well – If you have a team handling customer service (and you should at least have a VA doing it), then you need to train them well about your customers and about your products and services. Create a searchable FAQ for your agents so that they know the best way to respond to customers – to put them first and elevate customer support.

Finally, put systems in place that help you treat your customers the best. Allow them to communicate with you in a variety of ways and don’t hide your contact information from them. Most people like doing business with people who are transparent and helpful. To be honest, the competition for good customer service is easy to win since most businesses provide such lousy options. You can come out on top here with just a little extra effort.

No matter what type of business you have, it’s important to find as many ways as possible to show your customers love. What’s great about that is that they’ll return the love to you in numerous ways – such as sharing with their friends, buying more, and becoming devoted fans shouting your praises to everyone. 

1. Personalize Where You Can – When you personalize the service you give your customers, they do notice. Sending an email with their name, and sending thank-you notes with their name mentioned, help build the relationship closer. Even though most consumers realize that automation is used, they are still impressed, and they still appreciate it and notice it.

2. Build Relationships – The way to build a relationship is to open communication so that it’s both ways. Ask them questions, respond to their questions, and help the communication become two-way instead of one-way. Make it easy for them to contact you too, otherwise it will be hard to build a relationship. 

3. Call Them Personally – When someone spends a lot of money with you for the first time, a nice phone call is always appreciated. Even if you just leave a voice message, they will know that you thought enough about them to thank them. It’s amazing how great a personal phone call can make people feel. 

4. Offer Them Something Free – Even after someone makes a purchase, you can still offer freebies to them. Let’s say they purchased your amazing Fat-Free Cookbook. You could send them an easy-to-follow pantry guide for free with the purchase.

5. Thank Them – Never pass up an opportunity to thank your customers. Thank them on social media. Thank them personally, and thank them on your blog and website. The more thanks you show to your customers, the more they’re going to trust you and want to buy more from you.

6. Send a Satisfaction Survey – One way to connect with your customers is to give them some time to use whatever they bought from you, then send them a simple survey that asks about their satisfaction and takes another opportunity to thank them.

7. Provide Excellent and Fast Customer Service – Your customers need many ways to contact you. Don’t make it difficult for them. They need many ways to get service, from email to phone. Don’t make them spend time trying to figure out how to contact you.

The more you can surprise and delight your audience, the better. Doing just that little something extra can make all the difference in the world. Try to think outside the box about ways that you can please your customers – ways that are inexpensive to you but mean a lot to them.

The best way to improve sales performance for your business depends on the business. But in general, there are some things that you can do to improve sales performance in any type of business – whether you do it almost all alone or you have salespeople or affiliates working with you.

1. Understand Your Mission – You should be able to tell anyone who asks what your point of existence is. What are you trying to accomplish? What is your mission? Writing a mission statement may help you accomplish this. Pin it up on the wall so you can look at it any time you need to speak to someone about your business. 

2. Develop and Clarify Goals – Once you know your mission, you should break down the goals that you want to accomplish. Keep them clear and to the point. Remember that goals need to be specific, measurable, attainable, realistic, and timely. 

3. Set Up Processes and Systems – Even a solo business person will benefit from having processes and systems set up. If you’re not technologically in the know about what will work best for your business, find someone who has done what you want to do and ask them to help you. Pay someone for the knowledge; you’ll succeed faster. 

4. Sell to Your Customers What They Already Want – It’s so much easier to sell someone something if you’re attracting the right audience and creating products that you know the audience wants. When they say that they want XYZ, you say, “Here you go.” It’s that easy. 

5. Keep Your Products Top of Mind – Once you have contacted anyone, they should end up on your list. Make sure that they do, so that your products can stay top of mind. This also can work by using paid ads on social media platforms and posting on social media platforms. 

6. Ask for the Close – When you are talking about your products, you should always ask for the sale. If you don’t ask for the sale, you won’t make any. Ask for the sale in Facebook Live, YouTube posts, blog posts, sales pages, and yes, in person too. 

7. Listen to Your Audience – Find ways to listen in on your audience so that you know what they want and need. A great way to do that is to join groups of which they’re a part so that you can study what they say, ask questions, and be a resource. 

8. Improve Your Weaknesses – When you realize you have a weakness in a particular area, either learn how to do it or hire someone to do it for you. You can always fill in any weakness by outsourcing, and often that is the best way to go about it. 

9. Be Committed – When you have a great product, it’s simple to be committed. By committed to your product, your joint venture partners, your audience, and yourself by being proud of what you’ve created. 

10. Show Enthusiasm – People love passion and enthusiasm. Show that for your products and services. Show excitement. Show them how much you love it. Tell them how proud you are to offer it. 

11. Be Persistent – Don’t give up on the first try. You’ll need to contact your prospects more than once to get a yes. You may have to reach out to them 100 times in various ways, both online and offline. Do what it takes until you get an emphatic no and they unsubscribe from your lists. After all, if they really don’t care about what you’re offering, do they really need to be on your list anyway?

12. Use Your Resources – Resources include you, money, people, and technology. Maximize your time by using everything you have at your disposal to make it work easier. Email autoresponders, virtual assistants, and advertising can all go far in helping you make more sales. 

13. Provide Training – Whether it’s a contract worker, an affiliate, or an employee, training always makes a big difference. People tend to stick to jobs longer if they know what they’re doing and feel good about it. For example, it may take a lot of time to set up training for a new virtual assistant to do a task for you, but over time that training is going to pay off.

14. Use the Right Data – Know your goals and what data you need to study to find out if your efforts are working. Ignore data that isn’t relevant to your goals so that you can focus on what you’re doing right now, which is trying to improve sales performance. What key indicators will help you with that?

15. Create Products That Do What They Say – Outside of getting the word out about your products, knowing your products, knowing your audience and how to talk to them, creating products that deliver on promises is very important to help improve sales performance. If a salesperson knows that the product is fabulous, they’ll be much more enthusiastic selling it.

Improving sales performance is vital to any business – even a successful one. There are many areas that can always be improved. Start with one thing at a time and build on it as you become more successful.