1. No category

How to
double your
revenue in
three years
Steven Di Pietro
http://www.servicewithpurpose.net
Double Your Revenue eBook
About the Author Steven Di Pietro is the founder of a Secret
(Mystery) Shopping business employing
over 40,000 contractors who measure
service quality all over Australia and New
Zealand. From this well-qualified market
research, he has discovered what works,
and doesn’t work in Service and Sales. He has served 15 years in executive roles
in Financial Services, overseeing the
creation of new products, county
territories, and distribution networks.
Along the way, Steven has set up five businesses, co-authored a book and
now travels the world speaking to organisations about how to be
remarkable in Service and Sales.
Steven also broadcasts a weekly podcast, conducts training, speaks
professionally, and consults to companies about sales and service. To wind
down, he runs, plays competitive soccer and races competitive mountain
bikes but is most proud in his role as father, helping his wife raise three
children in Wollongong, NSW, Australia.
© Steven Di Pietro
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Double Your Revenue eBook
Forward The aim of this book is to share a simple formula for improving sales. At its
core, much of the selling process comes from customer service,
presentation and effort.
I have built a career and businesses based on service, but find too many
organisations struggling to move beyond revenue plateaus. This book
provides a simple structure for solving the problem of stagnant revenues.
The book is for any business manager or owner who is responsible for
sales. It doesn’t matter whether you are a sales manager or a high-level
executive, the principles are the same.
I have included some simple worksheets at the end of the book and provide
access to additional materials to help you dig into topics a little deeper.
Finally, I hope the book helps your business grow.
© Steven Di Pietro
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Double Your Revenue eBook
How to double your revenue Business is flat. There are more competitors. It seems you are struggling to
tread water, and not moving forward. The business doesn’t seem to be
growing. Sound familiar? Now what?
Your new sales budget requires that you increase sales by (say) 15%, or
some other ridiculously large number. How will it be done?
Now imagine setting a goal to double revenue in three years. In most
organisations, it would generate fits of laughter and worry.
How can you do it with the same products, same services, same
competitors, same staff, same everything?
This eBook will show you a mathematical formula guaranteed to double
your sales in three years. Obviously, it will require elbow grease and
initiative, but that’s where you come in.
The traditional approach When confronted with a sales imperative, many businesses resort to
traditional solutions. And under most scenarios, they make sense. The list
of initiatives might include:
•
Marketing promotions
•
Increased sales calls
•
Store layout reviews
•
Store locations
•
Loyalty programs
•
New product lines
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Double Your Revenue eBook
•
Discounting
•
New training initiatives
•
Mentoring
•
Coaching
•
Geographic expansion
In fact, the list is almost endless, but it quickly becomes overwhelming, and
you never know which one will work. Sometimes you try them all.
This eBook is about prioritising and understanding the role each major
initiative has to play, with a few surprises.
What is revenue? The International Accounting Standards Board uses this incomprehensible
definition:
"Income is increases in economic benefits during the
accounting period in the form of inflows or enhancements
of assets or decreases of liabilities that result in increases
in equity, other than those relating to contributions from
equity participants." [F.70] (IFRS Framework)
In other words, how much money do people pay you?
When I did my Accounting degree (a few lifetimes ago), I didn’t learn a
better definition than the accepted formula we all know.
Revenue = Price * Items sold
So when asked to increase revenues (sales) by a percentage,
organisations usually tackle the items sold. In other words, sell more. But
the formula does not tell the whole story. It was in the market surveying
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Double Your Revenue eBook
tens of thousands of businesses that I learned the winning formula to
boosting revenues.
How do you eat an elephant?
Image: David Blackwell on Flickr.com
The simple answer is to eat it in chunks.
With audacious sales goals, the first thing to do is to chunk them down.
The chunking down reveals the secrets of revenue.
Revenue is made up of only three key drivers.
1) Price
Price is the amount you charge for a product or service.
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Double Your Revenue eBook
If you have multiple product lines, you may think of it as the average price
of everything sold.
At this point, the accounting formula works fine. However, there are two
other components.
2) Number of customers
The number of customers is a critical piece of the sales and revenue
equation. Of course, if you have no customers, you have no income.
3) Number of transactions per customer
The more a customer transacts, the more revenue is generated. If you
have customers who never use your product or service, you have zero
revenue.
Taking this ‘retail’ approach to revenue, the formula becomes:
Revenue = Price * Number of customers * Transactions per customer
This formula gives the same answer as the accounting formula but breaks
it down into manageable parts.
Now we have the basis on which to break down the audacious goal of
doubling revenue over three years.
Take a minute to think about the formula. It is simple, obvious, and makes
sense.
Now what?
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The Rule of 8% So now that we know the components of revenue, we can break it up. The
rule of 8% is simple, and here the math gets interesting.
Increasing each of the revenue drivers by 8% each year will double
your income in three years.
Let’s look at an example retail store
Average Price = $40.00
Customers = 6,000 per year
Transactions per customer per year = 3
Multiplying out, the total revenue is $720,000 per year.
Now the magic. If each of those three drivers is increased by 8% each
year, then the total revenue in year three is $1,439,604 – double Year 1.
Let’s looks at each component separately.
Average Price
Increasing average price by 8% will yield the following results:
Average Price
Start
$40.00
1st year increase by 8%
$43.20
2nd year increase by 8%
$46.66
3rd year increase by 8%
$50.39
Number of customers
Increasing the number of customers by 8% will yield the following results:
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Number of
customers per
year
Start
6,000
1st year increase by 8%
6,480
2nd year increase by 8%
6,998
3rd year increase by 8%
7,558
Transactions per customer
Increasing the number of transactions per customer by 8% will yield the
following results:
Transactions
per customer
per year
Start
3.00
1st year increase by 8%
3.24
2nd year increase by 8%
3.50
3rd year increase by 8%
3.78
Putting it all together, we can see the transformation in revenue.
(a) Average
price
(b) Number
of customers
(c) Number of
transactions
Total
revenue
(a) x (b) x (c)
Starting
revenue
$40.00
6,000
3.00
$720,000
Revenue
after 3 years
$50.39
7,558
3.78
$1,439,604
© Steven Di Pietro
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Feel free to download a simple Excel spreadsheet to input your own
numbers at http://www.box.net/shared/6kdj3dbanb.
Now you know how the math works, let’s move to the how. How do you
increase each component 8%? But before we do, it is important to
understand where the numbers come from.
The model works equally well for banks and insurance companies. For
example, banks include interest + fees to calculate price (average).
Number of transactions per year can be replaced by products per
customer.
How to measure the components Picture: Leo Reynolds on Flickr
The hardest part for many businesses is actually getting the numbers. As a
speaker and consultant, I am constantly shocked at how many businesses
don’t know, and can’t find, this key data.
If you don’t know how to find this data, you have little chance of getting a
result.
Most businesses probably know their sales figures, but the big sales
number (in isolation) is too hard to manage.
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Double Your Revenue eBook
It doesn’t help anyone to read a report saying their total sales are 5%
behind target. Just measuring the big number and reporting it does not
educate staff on where they need to improve.
You need to measure all three components, and perhaps sub-components.
Measuring price
Measuring price is usually straightforward. Simply measure the average
price of each transaction. Price can be complicated by different factors.
There are options. Is it:
•
Cash received?
•
Inclusive of discounts and promotions?
•
Inclusive of add-on sales? (e.g., a mini bar in a hotel)
•
Inclusive of giveaways?
The most important thing is to pick a starting point and be consistent.
In the end, calculating average price is simple:
Total money received
Total items sold
It would be useful to make this same calculation over each different
business unit or product line but, ultimately, the average price must be
calculated at a company-wide level over all items.
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Measuring the number of customers
Picture: Dieter Drescher on Flickr
How many customers do you have? Do you know?
Most businesses know their transaction counts, but their customer counts?
What constitutes a customer? Is it anyone who walks into the store and
browses, or is it only people who transact?
At this point, I will take a mercenary line. We are talking about revenue, and
revenue is about transactions. So a customer is only a person who makes,
or has made, a transaction (or generated income) in the year. We will talk
more about converting prospects later.
Now that the customer is defined, the question remains: How many
customers do you have?
Naturally you could employ my company to help measure the number of
customers, but you can do it yourself.
Here’s a simple method. Count.
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Double Your Revenue eBook
If customers don’t make multiple visits in one day (and lets face it, most
don’t), then simply count the number of transactions at each cash register
and multiply out. Do not count the number of items sold.
What is the average time it takes for a customer to re-enter your store?
What is the shortest time it takes for a customer to transact? In a coffee
shop, it could be twice per day. For a mechanic, it could be once per year.
Count the number of cash register transactions over that minimum period
and multiply for one year. This can be complicated and require some
thought.
If you have cash transactions, or no cash register, then you may have to do
a sample physical count in some sample stores to count the number of
people who attend the counter.
This is not rocket science, but it is stunning that so many organisations do
not have this key piece of information.
Measuring the average number of transactions per customer
This measurement is not the average purchase amount, but a count of how
many things they buy.
If the customer is buying jeans and he/she is up-sold a belt buckle, then
this customer has made two transactions.
Once again, collecting the data is not difficult. Most companies know the
number of transactions (items sold) through their cash registers or stock
systems. Simply divide the number of transactions by the number of
customers to get an average.
If you don’t have electronic reportable systems, then once again, samples
should be taken.
As simple as these numbers are to gather, they can require quite some
effort.
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Double Your Revenue eBook
Facilitating the improvements Now that you have chunked down the math, chunk down the management.
Usually an organisation will set the target sales increase for a sales
manager (say 15%), and the sales manager will allocate the same increase
to all staff, so each salesperson should increase sales by (say) 15%.
If everyone does the job, then everyone is happy; however, just wishing
something to be so, doesn’t make it so.
Here is a step-by-step approach to implementing a sales improvement
program.
1) Calculate the three core pieces of sales data required (average
price, number of customers, and transactions per customer).
2) Set a targeted sales increase goal and calculate the increase
required in each component (for example, 8% in each component
over three years to double revenue).
3) Bring together a cross-section of key personnel to a planning
morning/day.
4) Hire a professional facilitator to manage the day (naturally we would
love to help).
5) Break the group into three subgroups (this is critical).
6) Have each group brainstorm and report back on how it will increase
one of the three critical success factors by 8% (or whatever your
goal is).
7) Once each group has presented its findings, the groups should
reconvene to prioritise their key ideas (in the context of knowing
everyone else’s ideas).
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Double Your Revenue eBook
8) Each group re-presents its key priorities, i.e., presents them again.
9) A combined list of initiatives is published for action.
10) Each group appoints a team leader and a champion to manage its
priorities.
11) Each group meets separately during the year to manage its
priorities and achievement of targets.
It is important that each of the three success factors is brainstormed,
implemented, and tracked by the same group. The group may be crossfunctional, cross-divisional, or even cross-country. It doesn’t matter. What
matters is that one group is responsible for each key success factor, and
drives it.
Breaking down the target into a small number and small pieces makes it
less daunting, more manageable, and more attainable.
Strategies for improving key success factors The collective wisdom of each group is sure to come up with genius ideas
for improving each success factor by 8%. Included below are some
strategies that may be used as a primer for those discussions.
Increasing price The key question: How can we increase the average price 8%?
Before exploring some options, here are some myths about pricing.
•
Consumers act rationally
•
Consumers only care about price
•
Quality determines price
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•
Prices should be consistent
•
Consumers do as they say they will
•
Price is not an issue
•
Pricing is a science
Though some of the suggestions below are opportunistic, the majority are
based on delivering better value. As a result, your customers will be
happier and you will get a higher price.
1)
Just increase the price. Simplistic but possible in many industries.
We recently did this in our mystery shopping business and
increased sales.
2)
Give something away. Increase the price 10% but give away
additional value (e.g., a three-month free membership to a loyalty
product).
3)
Cut your low price offerings and increase the high. This will
increase your average price and could be done in conjunction with
a giveaway as part of the high priced offering.
4)
Understand your competitors. Are there products or categories that
you sell better than the competition (e.g., you might be the only
coffee shop selling flowers)?
5)
Create convenience. Widen your product sphere to include
convenience options (e.g., a travel agent selling international
power converters).
6)
Tier your pricing. Can you introduce a First Class or Business
Class version of your product or service (e.g., First Class, or Gold
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Class, customers get priority access to support, bookings, and
product releases)?
7)
Break up your pricing. Rather than one price fits all, break up the
price into individual components. EBay sellers do this by splitting
out insurance and postage. Cut-price airlines do this with meals.
8)
More service for more money. Offer more services/products for a
higher price. Airlines could bundle home pickup for passengers at a
set cost. Car repairers could offer home pickup for an additional
fee.
9)
Bundle. Offer combinations of products. McDonald’s is the master
of bundling together a meal.
10) Dump the mark-up formula. Simply marking up a product by a fixed
number is ignoring the power of market forces. Does the mark-up
formula work for all products? Are there product lines that provide
opportunities to increase price?
11) Test. Test price increases in different categories, in different stores,
at different times.
12) Emphasize the fashion. In some product lines—especially women’s
fashion—it may be possible to offer timed discounts. Charge full
price for the first three weeks, then automatically discount every
three weeks thereafter.
13) Captive pricing. Create a product line which is dependent on
another. Think Gillette shavers.
14) Geographical pricing. Charge higher prices in premium areas, or
where there is little competition.
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15) Create scarcity. Create one-off or limited edition versions of the
product.
16) Use your brand. Put your brand name on commonly purchased
products, or make it more prominent (e.g., car manufacturers
selling car seat covers with their brand name emblazoned on the
top, as opposed to a generic cover).
17) Certified products. Sell your product to distributors as a certified, or
company approved sale. Countries can do this and so can you
(e.g., certified Australian beef, or quality control checked in our
West German quality centre).
18) Publicise origin. Tell people where the product originated. Fruit
growers can get higher premiums by advertising their products as
local (e.g., If you live in Los Angeles, you might pay more for
vegetables “grown in California”). Just ask any premium wine
producer if origin is important. Origin is irrelevant for cheap wines
but critical to premium brands.
19) Entry-level luxury. Market a product between cheap and premium
pricing, adding more value to cheap offerings but less than
premium (e.g., Economy Plus seats on airlines).
20) Reduce choice. Avoid providing too many products to compare. It
can distract the buyer, and out of fear of paying too much, he/she
will buy the cheaper product (e.g., bread).
21) Break up the transaction. The opposite of bundling. Let the
customer choose and buy the incremental products and services
he/she requires, each with its own non-discounted price (e.g.,
discount airlines charging for meals).
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22) Offer the world. You never know a person’s purchasing
circumstances so offer an extreme version. Have an option to buy
the all-singing, all-dancing version, such as a personally delivered
version, or same day service (e.g., a restaurant offering limousine
pickup, or a house painter offering to complete a three-day job in
one day, including steam cleaning all furniture).
23) Pre-release versions. Charge a premium for the privilege of having
your product first. This may sound like it punishes your loyal
customers, but they may choose to pay more to be first, and be
appreciative (e.g., releasing a new female clothing line).
24) Discourage mavericks. Tighten controls so maverick sales staff
cannot make unauthorised sales.
25) Segment your market. Not all customers are the same. If you don’t
know where the segments are, find them.
26) Odd-ending. Round your prices to odd numbers. You still can’t beat
the $3.99 price tag as opposed to $3.80.
27) Truncated pricing. For some high-end products, you may consider
rounding prices up to a round number. Rounded prices give the
appearance of quality. For example, a $1,500 handbag sounds
more luxurious than a $1,399 handbag.
28) Group pricing. Sell everything in a category for the same price. For
example, you could sell all music DVD’s for $15. The higher priced
products may need to be discounted, but revenue on the lower
priced ones will increase. As a result, the average price of all
products sold increases. The shopper will buy because it’s easier,
and everything is perceived to have the same (good) value. If the
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shopper knows they can get good value on the higher priced
product, they will equate that value to all categories.
29) Reference pricing. Set a higher price as the reference point and
then discount. Car manufacturers and real estate agents are expert
at creating perceived value. When the item settles to its intended
sale price, the buyers still perceive that they have received a
bargain. This also commonly applies to electrical goods with a high
sticker price that shows items selling at a discount.
Number of customers The key question: How can we increase the number of customers by 8%?
Here are some myths about the number of customers in your business.
•
We have already penetrated as far as we can.
•
They suffer inertia and are reluctant to move from their current
supplier/provider.
•
It’s expensive to get more customers.
•
We have all the customers we need (if only we could sell them
more).
•
We can’t get more customers without starting a price war.
•
Customers are so hard to find in new markets.
•
It takes time to increase the customer base.
The following idea prompters are provided to give your groups a head start
in creating their own customer acquisition strategies. These strategies do
not depend on marketing or advertising spend.
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30) Service. This one is massive and simple. It is the subject of a whole
separate book. Service = Customer, but for some reason, this
formula is elusive.
31) Recommendations. Find a way for your customers to make direct
recommendations (e.g., a LinkedIn recommendation
www.linkedin.com).
32) Referrals. Make it easy for one customer to simply and easily refer
another.
33) Affiliate programs. Pay your customers to sell your product. Online
marketers have become expert at this method.
34) Increase your commissions, and your price by the same amount.
Negotiate this with your sales staff.
35) Get active. Start blogging and social media interactions (the topic
of another book) to broaden your reputation and reach.
36) Get out. Yes it’s tough, but get out and meet people.
37) Visit the dead. Contact and visit your ex-customers. You will be
surprised at how many simply forgot about you and will buy again.
38) Fight for space. Hustle your distributors to get better shelf space.
39) Teach the sellers. Work with distributors to run special training
days so your product is top of mind and people have good product
knowledge.
40) Mystery shop distributors and retailers to make sure your product is
top of mind, and they have good knowledge about it.
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41) Run advertising gimmicks. If you ran a successful marketing
campaign in the past, run it again and run it in more places.
42) Test market. If marketing is in the mix, run test markets and
measure, measure, measure. Then you will know if you should run
it again.
43) Be different. Be the purple cow. Be controversial. Be original.
44) Stand for something. Consider offering less to become the leader
in a specific segment, and sell more (e.g., Southwest Airlines).
45) Segment the market. Know exactly which group you are chasing.
46) Buy the market. Be careful to balance market buying prices with
the goal to also increase pricing by 8%.
47) Paint a picture. Be illustrative and paint a picture of three dream
customers. What do they look like? How old are they? What’s their
name, background, apprehension??, status and so on? If you know
who you are looking for, they are easier to find.
48) Get into the industry. Participate in your industry association and
build connections. Apart from learning, you will be surprised at how
many competitors will refer business. This is also great for
positioning and gives you another way to be found.
49) Get into another industry. Participate in another industry which
comprises your clients. Get known (e.g., a mortgage broker
participating in the local accounting chapter).
50) Search Engine Optimisation (SEO). Make sure your website ranks
high in search engines. Consider a total rebuild.
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Average transactions per customer The key question: How can we increase the average number of
transactions per customer by 8%?
Here are some myths about how often a customer will transact.
•
If they wanted more, they would ask!
•
They won’t buy until the original item expires.
•
They don’t like us to be pushy.
•
Customers want more than one supplier, to be safe.
The following idea prompters are provided to give your groups a head start
in creating their own customer acquisition strategies.
51) Service. How can the service proposition be improved to
encourage repeat purchases? It is a broad, comprehensive topic
but needs to be one of the first addressed.
52) Loyalty schemes. If you don’t have one, can you get one? Loyalty
cards are typically for retail situations but can also be applied to the
corporate environment. Think airlines and hotels. In the high end
corporate environment, loyalty benefits can involve football tickets
or movie premiers. What perks can you offer in your environment?
53) Prepaid pricing. Customers can purchase their own loyalty by
paying upfront to be a ‘member’ in order to receive discounts.
Asking customers to pay for loyalty is different to earning it
because 1) it creates greater perceived value of the benefits, 2) it
allows you to give more immediate benefits, and 3) you get money
upfront.
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e.g., Perisher Blue ski resort allows customers to pay $48.00
upfront. In exchange, the first six days of skiing in the season are
reduced by $20 each, and the seventh and ninth days are
discounted $60.00 each. In a competitive market, competition is
removed.
54) Extend the purchase. Offer a complimentary product over time
(e.g., a bicycle seller could sell a ‘renewal kit’ after one year to
include new brake pads, a chain, and cables fitted for a fixed price).
55) Force advance purchases. Incentivise the customer to make
advance purchases (e.g., car repairers could offer discounts for
prepaying the next three car services).
56) Competitions. Create competitions around your product (e.g., every
purchase goes into the draw for a prize). It’s as applicable to
corporates as it is to consumers.
57) One-stop shop. Extend the product offering to encapsulate more of
the experience (e.g., a barber selling shaving equipment and hair
care products).
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58) Team up. Work with other suppliers to leverage each other’s
products (e.g., accountants and lawyers or mechanics and auto
electricians). Just reach out.
59) Direct sales. Sales are the normal fodder of a retailer but not often
explored outside consumer retail. A direct sale occurs when you
offer something special/different and the customer buys.
60) Referral. When a customer is referred by another customer. As the
seller you have no control over word-of-mouth except to provide
great service to existing customers. The cost is low and the return
per referral is high. Can you encourage your customers to refer?
61) Suggestive selling. Used when a customer is looking for a product.
It’s sometimes (but not always) like a soft-sell. Suggestive selling
comes from a position of service. The staff member makes
suggestions irrespective of sales targets or quotas. They are simply
helping provide answers. For example: “If you don’t like lamb, I
would suggest the beef curry. It is the same price and uses the
same curry base”.
62) Up-selling. A common way to increase average sales per
customer. But the up-sell is sometimes misunderstood. An up-sell
is when the customer is sold a more expensive version of the same
product. For example, when buying a car, the buyer might be sold
into leather seats as an up-sell from cloth. The up-sell is different
from the cross-sell.
63) Add-on sale. The add-on sale is when the customer buys an
additional product related to the original purchase. It is different
from the up-sell because it is not part of the original purchase, and
it is not a cross-sell because it is not a different product. For
example, when purchasing a car, the buyer may also purchase a
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towing kit. More simply, it could be “buy one, get the second free”.
The add-on sale is all about moving more product (and enticing the
original purchase), not necessarily a more expensive version of the
same product (as with up-sell).
64) Cross-sell. A cross-sell occurs when the customer buys a different
product following the original purchase. The additional sale need
not be related to the original sale but requires some interaction by
the seller (as opposed to an impulse buy at the supermarket
checkout counter). For example, when buying a pair of jeans, the
cross-sell would be for a belt.
65) Impulse. The impulse sell requires no individual knowledge of the
customer’s requirements. Organisationally, the impulse buy places
the product in front of the right customer at the right time. The
organisational understanding of the customer comes from
marketing departments, not individuals. For example: Place sweets
and chocolates at the supermarket check-in counter.
66) Repeat sales. Repeat sales are similar to word-of-mouth except the
customer recommends the product to themselves. The drivers are
the same as for word-of-mouth. Repeat sales require the whole
organisation to provide a customer experience, beyond customer
service (see an explanation of the difference at
http://www.servicewithpurpose.net/imported20100319210958/2008/10/5/the-difference-between-customerservice-and-customer-experie.html ). Even repair shops can create
repeat sales through the creation of maintenance programs.
67) Family members. Create programs and deals to include family
members in the repurchase. For example, if dad buys a bicycle, he
can buy one for his kids at 30% off.
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68) Bundling. Buy one product and receive others free or at a reduced
price. We know this tactic well from phone carrier deals, which
might include phone, mobile and internet all bundled together.
69) Electronic delivery. Allow customers to buy an electronic version
cheaper, or as a supplementary product. Alternatively, allow the
purchaser to buy a simple, low-cost electronic version of the
product for a fraction of the price, but nonetheless contributing to
income.
70) New improved version releases. Allow customers to have prerelease versions of the latest version of a product, (e.g., a car or
computer software). Make them feel special about having the latest
and greatest, and increase your transactions per customer.
71) Make a dead man offer. Once your product has reached its useful
life, make an offer for another product or sale (e.g., once a
customer’s car warranty has expired, he/she may be tempted to
visit the corner garage rather than the dealer). This need not be the
end of the customer lifecycle. Reach out and extend your customer
lifecycle.
72) Buy one, get one free. Buy one, get one half price. Kids eat free. All
valid offers but be careful because they may conflict with the desire
to increase average price.
73) Decrease friction. Make it easy for people to buy. In too many
cases, it is still too difficult for customers to buy. Remove steps for
internet purchases. Remove long telephone conversations. Make it
easy and frictionless.
74) Auto-reorder. Give customers the option to automatically purchase
something on a renewal contract. Cable (Pay) TV providers and
© Steven Di Pietro
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Double Your Revenue eBook
insurance companies have mastered the art. Rather than ask for
an annual payment, they simply take money from your account or
credit card each month and automatically renew. The payment
arrangement is easy and frictionless, removing effort for the
customer, and the contract is automatically renewed.
75) Create a perceived discount. Create a pricing reference point as an
incentive for a combined bundle purchase. In the example below
for Harvard Business Review, it seems to make no sense that the
internet version and the print version are the same price. Yet
setting the expectation that they are the same value allows the
seller to charge more for the bundle (even though their incremental
cost is zero).
So there you have it—75 examples of how to increase your revenue. But
these profitable strategies are just a fraction of the revenue generating
ideas your teams will develop. See the Double Revenue Workbooks on
page 29 to help work through your own initiatives.
© Steven Di Pietro
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Double Your Revenue eBook
Double Revenue Workbook The following workbook is broken into separate worksheets. They will take
you through a simple process for setting your goals, and creating
actionable strategies.
The goals and strategies are broken into the three key components of
price, number of customers and transactions per customer.
© Steven Di Pietro
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Double Your Revenue eBook
Worksheet 1 - Average Price
Immediately below is an example to help you calculate your target price at
the end of Year 3.
a. Average price today
$40.00
b. Growth rate (use 8% to double in 3 years)
8%
c. Average price at end of Year 1 (a x b)
$43.20
d. Growth rate (use 8% to double in 3 years)
8%
e. Average price at end of Year 2 (c x d)
$46.66
f. Growth rate (use 8% to double in 3 years)
8%
g. Average price at the end of Year 3 (e x f)
$50.39
Now insert the numbers for your own business unit, or business as a
whole. The only number you need to start is the first one.
a. Average price today
b. Growth rate (use 8% to double in 3 years)
c. Average price at end of Year 1 (a x b)
d. Growth rate (use 8% to double in 3 years)
e. Average price at end of Year 2 (c x d)
f. Growth rate (use 8% to double in 3 years)
g. Average price at the end of Year 3 (e x f)
© Steven Di Pietro
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Double Your Revenue eBook
Worksheet 2 - Number of Customers
Immediately below is an example to help you calculate your target number
of customers at the end of Year 3.
h. Number of customers today
6,000
i. Growth rate (use 8% to double in 3 years)
8%
j. Number of customers at end of Year 1 (a x b)
6,480
k. Growth rate (use 8% to double in 3 years)
8%
l. Number of customers at end of Year 2 (c x d)
6,998
m. Growth rate (use 8% to double in 3 years)
8%
n. Number of customers at the end of Year 3 (e x f)
7,558
Insert the numbers for your own business unit, or business as a whole.
The only number you need to start is the first one.
h. Number of customers today
i. Growth rate (use 8% to double in 3 years)
j. Number of customers at end of Year 1 (a x b)
k. Growth rate (use 8% to double in 3 years)
l. Number of customers at end of Year 2 (c x d)
m. Growth rate (use 8% to double in 3 years)
n. Number of customers at the end of Year 3 (e x f)
© Steven Di Pietro
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Double Your Revenue eBook
Worksheet 3 - Transactions Per Customer
Immediately below is an example to help you calculate your target
transactions per customer at the end of Year 3.
o. Transactions per customer today
3.00
p. Growth rate (use 8% to double in 3 years)
8%
q. Transactions per customer at end of Year 1 (a x b)
3.24
r. Growth rate (use 8% to double in 3 years)
8%
s. Transactions per customer at end of Year 2 (c x d)
3.50
t. Growth rate (use 8% to double in 3 years)
8%
u. Transactions per customer at the end of Year 3 (e x f)
3.78
Insert the numbers for your own business unit, or business as a whole.
The only number you need to start is the first one.
o. Transactions per customer today
p. Growth rate (use 8% to double in 3 years)
q. Transactions per customer at end of Year 1 (a x b)
r. Growth rate (use 8% to double in 3 years)
s. Transactions per customer at end of Year 2 (c x d)
t. Growth rate (use 8% to double in 3 years)
u. Transactions per customer at the end of Year 3 (e x f)
© Steven Di Pietro
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Double Your Revenue eBook
Group Worksheets
Use the following worksheets to focus your staff brainstorming. It is
important to assign responsibility with a single person or small group. It is
preferable to make a different group responsible for creating each of the
three strategies.
These one-page worksheets become the single strategy reference point.
There is no magic; the magic comes when you write your strategic
initiatives and commit.
Some strategic initiatives take time to develop, but don’t let them run
forever. It is important to consider a date to reassess whether to continue
or stop the initiative (continue/stop date). If the initiative is not working,
move on to another.
© Steven Di Pietro
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Double Your Revenue eBook
Worksheet 4 - Price Improvement Strategy
Today
Increase (use
8% to double
in three years)
In Year 3
Responsibility
Due Date
Continue/Stop
Total ( from
Worksheet 1 –
Price).
Initiatives (list
below)
Decision Date
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
© Steven Di Pietro
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Double Your Revenue eBook
Worksheet 5 – Customer Strategy
Today
Increase (use
In Year 3
8% to double in
three years)
Total (from Worksheet
2 – Number of
Customers)
Initiatives (list below)
Responsibility
Due Date
Continue/Stop
Decision Date
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Worksheet 6 – Transactions per Customer Strategy
Today
Increase (use
In Year 3
8% to double in
three years)
Total (from Worksheet
3 – Transactions per
Customer)
© Steven Di Pietro
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Double Your Revenue eBook
Initiatives (list below)
Responsibility
Due Date
Continue/Stop
Decision Date
1.
2.
3.
4.
5.
6.
7.
8.
9.
© Steven Di Pietro
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Double Your Revenue eBook
Final Words Sales is service, and service is sales. Although the sales formula is
superficially simple, it is also immensely challenging because the options
are almost limitless.
The 75 recommendations listed here should be more than enough to get
you started. That is the whole point. Start and don’t ponder.
Pick some strategies, execute, review and move on.
If you have not already done so, please visit www.servicewithpurpose.net
and subscribe to my newsletter.
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© Steven Di Pietro
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