The average e-tailer or e-commerce store spends the vast majority of their time and resources finding new customers. Ironically, this is the most difficult and expensive task a business faces. After going through all of the effort to acquire this new customer, they simply leave the possibility of reordering to chance. To have a backend means to have mechanisms in place that help your customers buy from you multiple times.
No matter what statistics you look at, it is always easier to sell to an existing customer than a new customer. Unless you really botched up their order and did not deliver on your promises. If that is the case, you have other issues that need attention. For example, selling to an offline B2B customer may look like this. You have a 1 in 8 chance of converting a new prospect (probably closer to 1 in 100 or 1 in 50 for B2C), a 1 in 3 chance of converting an inactive lead (no purchases in last 12 months), and a 1 in 2 chance of converting an active lead.
So, why do so many of us (the vast majority) fall into the trap of constantly searching for new leads and neglecting our active and inactive leads? Often it is because we don’t realize that we could easily be leaving a 50% increase in our revenues on the table or we simply don’t understand where to begin. We are not unfamiliar with the process because often successful companies that we purchase from use backend strategies on us.
An internet business breaks down nicely into a few general areas: traffic, conversion, and backend. All of which are only a means to an end; increased sales which hopefully leads to increased profit. Many people focus nearly all of their energies on increasing traffic. A subset recognize that it is often easier to increase conversion than it is to increase targeted/converting traffic. An even smaller subset recognize the power of selling more than once to their existing customers. This actually allows them to increase revenue while keeping cost of sales flat.
Information marketers often use backends to sell more because it is easy for them. You start with a free newsletter which leads to an ebook which leads to an audio course which leads to a video course which leads to a tele-seminar which leads to a membership site which leads to a coaching club. The same thing applies for physical products but it simply requires a bit more creativity and effort on your part.
Start small and build from there. If you give your customers more of what they want and enhance their ability to get the results they are after; you may very well double your business literally overnight.
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