Have you noticed that every time you go to a tourist spot or attraction, you end up paying more than just the initial price of the ticket to enjoy the service? You pay something like $20 for the entrance fee; then you find yourself at the souvenir shop or photo booth paying an extra $30.
These “back-end offers” are how companies make good money from their customers who have already purchased a front-end product. In the example above, it would be a ticket or an entrance fee.
The Product Staircase
Just like these tourist attractions, good businesses should have a “product staircase,” which willguide the customer to buy more products for increased sales.
Your product staircase could look something like this:
1 on 1 mentorship (buy)
Live event (buy)
At each step, you are offering customers a service and the opportunity to purchase a product for that service.
However, you have to be careful in drafting your product staircase. If customers can’t get anything of value, they’ll not only refuse to buy any more of your back-end products; they probably won’t go back to your business since they might feel cheated. The worst thing you could do is to drive them to your competitors.
Like any aspect of your business, ensure that you offer products that will benefit your customers, leaving them with no choice but to commit to your service.
There’s More Than Just the Front-End
Successful businesses have a range of products in their front-end, mid-tier and back-end programs.
A front-end offer, similar to the product staircase example, would be the content that will teach customers the basic information of the solutions they seek.
Once they take the first step and make a purchase, it’s crucial to offer more steps so customers can buy more of your products (back-end offers). For example, in the product staircase above, back-end offers include online courses and 1-on-1 coaching services. This is where you can encourage customers to make repeat purchases.
I believe that any company that fails to include any back-end offers is risking a 90 percent loss of potential revenue. It’s safe to say that about 90 percent of MOBE’s revenue over the past few years has come from our back-end programs, with prices ranging from $2,000 up to $60,000.
Opportunity to Charge High Premiums
In this industry, a lot of customers don’t really have the time to carry out the work your products or services offer and are, instead, happy to pay to get the job done for them.
For example, if you’re showing customers an info product or educational program on how to generate better traffic, a lot of them might prefer to pay you to accomplish the task while they wait for results. This allows you to charge a much higher premium rate as your service is “all-inclusive” with results, which is much more valuable to the customer than just getting the information.
It’s your responsibility as a business owner to give your customers what they want. And when the demand for a particular service is prevalent, it’s your cue card to charge a justifiable rate!
Never Stop Adding
Finally, as a business owner, it’s vital that you never stop including additional offers for your existing customers to maintain their loyalty and constantly increase their lifetime value. According to Business2Community online, it can be up to six times more expensive to get a new customer than it is to generate more revenue from an existing customer.
MOBE was able to increase the lifetime value of their customers, and they are always looking to add more effective products.
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