How can you double your sales online?
This post talks about how to:
- Automate your lead generation
- Double your growth using using digital marketing.
Impediments to Scaling
There are a number of different factors that determine the speed you can grow your business.
- LEADS – Crete an online, automated Sales Funnel that grows as fast as your cash will allow.
- CASH!!! Cash Conversion Cycle and Managing Cash Flow is an important factor in growth.
- … and everything else: Infrastructure, Processes & People will constrain all other factors of growth.
In this post, we’ll focus on producing leads to double your growth in sales. I plan on delving into the other pieces of scaling your business in future posts.
You can use the techniques described in this post to plan your business growth and scale your revenue.
What is a Sales Funnel
A sales funnel is simply how you get new customers. Simple.
For many businesses, their main sales funnel is a physical store and … LOCATION, LOCATION, LOCATION!
1) Plop your store along a big highway, 2) have good signs, and 3) create a great store experience = SALES FUNNEL!
Although this is an example of a sales funnel, you’ll find that your revenue will plateau once you have reached the number of interested customers that drive past your store frequently.
Once you’ve saturated that market, you’ll need to develop more sales funnels in order to grow larger and larger.
That same business with a great location may also have door-to-door sales associate that sells their product straight to consumers or a website that does the same.
Expert digital marketers take the idea of a sales funnel online. We’ve developed a precise series of steps that maximize a digital sales funnel. It basically consists of the below pieces:
Sales Funnel Overview
- Ads: We start on unowned media and buy ads. In today’ world, good ads are ones that move a client along the path from a cold lead to a hot lead. For example, on Facebook it pays to begin with blog posts to introduce yourself to customers.
- Free Offer: This is where we take a customer and offer them something they REALLY want. They give us their email or contact info, and we have a lead!
- Unbelievably CHEAP Offer: This is sometimes called a tripwire offer, and I may or may not use one depending on the circumstances. If you price a small but critical offer below market value, then you’ll be able to win over marketshare and upsell after you’ve developed a customer relationship. The basic concept is that it’s 4-6 times easier to sell to an established customer. Therefore, if you lose a little up-front you can still make it up on the backend.
- Core Offer: This is where you sell what you intended on selling and make some money.
- Maximize Profit: Most of your profit will likely come from re-engaging already existing customers. Since it’s sooo much easier to sell to current customers who already know you… RE-ENGAGE!
A sales funnel serves the purpose of taking a “cold” stranger who hasn’t met you or your brand, and warming them up to the point of becoming a “hot” fan who wants to buy EVERYTHING you offer.
Once you’ve created a brand evangelist, they’ll go out and tell the world about you.
There’s a lot more you can add to the above list. Here are a few good ideas:
- Autoresponder: Create an indoctrination series to automatically email to new subscribers.
- Content Marketing: Become an authority in your niche, and blow people out of the water with great posts!
- Offer Additional Splinter Offers: How many pieces can you split your core offer into? What other angles can you take? Be SPECIFIC and solve specific problems that your customers face. You’ll engage different customers with different solutions.
Once you’ve created your first online sales funnel, you can engage customers across a large number of different mediums:
- Google: Get ranked in Google by focusing on a content marketing, SEO, and an influencer outreach strategy.
- Facebook: Facebook has superb targeting and a huge audience to setup your first sales funnel.
- Social Media: Tools everywhere! Increase posting, reach out to customers and influencers to grow your social presence and find new leads! Twitter, Pinterest, LinkedIn, …etc. There’s a lot of traffic you can buy!
- Google AdWords: Want to get traffic from Google without the 6 month – 2 year lag time of organic approaches??? Why not purchase traffic?
- Email Lists: Purchase email list blasts from influencers in your niche. Send them your valuable offer!
- … and on, and on.
I heard one great case study that illustrates what I’m talking about. This examples takes the above digital process and brings it into the physical world to sell tea. One tea company, I’ll call them TeaLeaf Co, started out by offering FREE TEA SAMPLES (Free offer) to people walking by their store. They sent employees onto the streets (Advertising on Unowned Media) to tea enthusiasts walking by (great geographic targeting!). Then they told everyone who liked their tea about an amazing low-cost offer they were having in their tea shop. If a new customer purchased a tea mug for $5.50, they could refill it for an entire month, for free! This low cost offer hooked interested customers and pole vaulted over the psychological boundaries of buying from someone new! Once hooked, the customers began to buy the tea at normal prices (core offer) once the offer ran out. That’s a great example of a sales funnel.
Case Study: How to Sell Tea like a Marketing Ninja
I heard one great case study that illustrates what I’m talking about.
This examples takes the above digital process and brings it into the physical world to sell tea.
One tea company, I’ll call them TeaLeaf Co, started out by offering FREE TEA SAMPLES (Free offer) to people walking by their store. They sent employees onto the streets (Advertising on Unowned Media) to tea enthusiasts walking by (great geographic targeting!).
Then they told everyone who liked their tea about an amazing low-cost offer they were having in their tea shop. If a new customer purchased a tea mug for $5.50, they could refill it for an entire month, for free!
This low cost offer hooked interested customers and pole vaulted over the psychological boundaries of buying from someone new!
Once hooked, the customers began to buy the tea at normal prices (core offer) once the offer ran out.
That’s a great example of a sales funnel.
Now that you know what a sales funnel is….
How to Double your Online Sales by Creating a Sales Funnel
How would you use a sales funnel to set your business up for doubling your sales each year?
It’s simple… sorta.
Okay, this can be a bit hard for newbies! I plan on doing an in-depth webinar in the near future (We offer a free consulting session, if you would like to learn more!).
Step 1: Create a great blog post or video that offers a lot of value to a new customer.
Step 2: Create an irresistible free resource related to your core offer. Offer this to a potential client in exchange for their email.
Step 3: Run Ads targeting your ideal customer on Facebook. First, send them your great blog (“ungated”) content. Pixel the ones who click the ad, then retarget them with the free offer to create your email list.
Step 4: Setup a 5-6 email AutoResponder that sends out high-value blog posts related to your core offer, and ends on a sales pitch (or “next step” offer).
Step 5: Track and Tweak… even the experts will only create a working funnel 3 out of 10 times on the first try.
Step 6: Create a follow-up sequence for those who don’t respond to maximize the conversions.
Step 7: Re-Engage with additional offers to maximize customer value.
Now you’ve got your first Sales Funnel! Congrats!
Once your sales funnel is producing leads track the Customer Acquisition Cost and lead quality from different traffic sources.
How much does it cost to get a new lead? How much does it cost to get a sale?
Once you know, how many leads on average end in a sale, you can put in whatever cash you need to create those leads.
For us, we’ve found that the bottleneck is generally the number of leads that our salespeople can handle. It’s a cash flow balancing act matching your leads to your sales people while also scaling up your sales force.
Balance your cash flow between lead generation and sales. The closer you are to zero cash at the end of each month, the more you’ve maximized your throughput and growth.
Example: Doubling your Sales Each Year
Year 1 Revenue: $100,000
Year 2 Revenue Goal: $200,000
Core Offer = $100
Margins = $90 – Information Product
Lead Acquisition Cost: $5/lead
Average Sales = 1 sale every 10 Leads
Customer Acquisition Cost = 10 Leads * $5/lead = $50/Sale
In this example, to make $200,000 sales, we’ll need to sell 2,000 products.
At 10 leads per sale, that means we’ll need 2,000 sales * 10 leads/sale = 20,000 leads to hit our 2000 sales goal.
That means we’ll be spending 20,000 * $5/lead = $100,000 in advertising.
Split that up over 12 months to give yourself a monthly spending goal: $8334/month, should get you to your goal of doubling your sales.
One Step Further… Cash Conversion Cycle (CCC)
To see how cash flow affects growth, you can create a spreadsheet that outlines when you get cash from the sales you make. There’s a great Harvard Business Review that describes the Cash Conversion Cycle. Although the academic ideas don’t translate perfectly to a small business, the concepts are important to understand.
You can increase growth by increasing your margins (cutting costs/increasing price) or decreasing your Cash Conversion Cycle. That means you can…
- Get Cash Sooner: Get customers to pay sooner or put them on automatic payment.
- Pay Later: Use credit cards and other options to give yourself more time before you have to pay money out of your business.
- Shorten Inventory Cycles: Shorten the amount of time that cash is tied up in inventory and inventory creation.
This is a simplified summary of the concept, but read How Fast Can Your Company Afford to Grow to learn more about how to find your Cash Conversion Cycle.
Although it seems simple walking through an example like this, it often takes me 3 months to setup a solid sales funnel, and continual adjustments to keep it on track. Furthermore, there are a lot of small adjustments that can make big differences.
As you scale, you can also try testing out additional sales funnels and different advertising mediums to maximize your Return on Investment (ROI).
Understanding your sales funnel and adding new sales funnels is the key to growing your business.
If you’re new to building online sales funnels, and you don’t know what step to take next, schedule a time to talk with one of our consultants. For a limited time, we’re offering a free 1 hour consulting session normally priced at $100/hour.
You can also check out our Top of Google webinar to learn how to bring organic search traffic into your sales funnel.
We offer a few resources to everyone who comes to our Top of Google webinar:
- 5 Step Process: What are the steps that other businesses have used to get to the top of Google
- 27 businesses analyzed to bring you real life case studies of what works and doesn’t
- 15 Warnings: Avoid these warnings before they shipwreck your business online.
- Free Web Presence Audit: You’ll be surprised at what we find.
- Expert Consulting Session: Our expert will explain what options you have to increase sales online based on your Web Presence Audit.
Check it out by clicking below…
Author: Joseph Terndrup
Hi! I’m Joseph, the founder of Underdog Marketing. I am passionate about digital marketing, growing businesses, and start-ups. I’m an insatiable learner and a repeat entrepreneur. I love writing and I work on projects that I find purpose in with people who I believe in. I look forward to connecting!