Unless your business is operating with absolutely no oversight –it can be nearly impossible to ‘save,’ ‘trim,’ or budget your way to profitability.
When a business’s fixed costs are high, its cash-flow is slow or stagnant, and when its labor costs make up a major portion of the business’s overhead, the only way for that business to become truly profitable is for that business to increase its sales!
‘Sales Solve Problems’
“Great!” you say…. “How do I do generate more sales?”
Knowing the reasons why your customers buy from you in the first place is a great place to start. Today’s consumers are smarter and more informed than ever before. Consumers don’t always follow a linear path from initial awareness to consideration to first purchase. Many different factors now influence the buying process such as…
- Perceived Value
Convenience: Are You Mobile-Friendly?
Over 80% of consumers now use some form of online research for nearly all of their purchasing decisions. It’s virtually free and so much easier to find information about products online – including the all-important testimonials and customer reviews. This gives people the pros and cons of what they want or need based on the feedback of their peers.
Carefully review how your website appears on mobile devices. In fact, with so many consumers using their mobile device for so many things, it may be wise to design your website and landing pages for optimal mobile viewing first, and then worry about how your site appears from a web browser second.
People tend to favor instant gratification. They demand fast information, quick answers to their questions, and the ability to tackle tasks with their mobile devices while on the move.
Don’t let your competition beat you to the punch here. Make yourself available 24/7 – 365 by updating your website and landing pages, and optimizing them for mobile use too!
Your pricing may be competitive, but your business may still not be generating sales. Even if your business is offering higher quality, quantity, and more benefits than the competition!
People make instant decisions with their subconscious which may have nothing to do with the facts. For instance, when most consumers are asked to explain their purchasing decisions, their choices frequently change since the rational mind –which works completely differently than our subconscious, emotionally-driven mind –is now involved.
Sometimes consumers shop for the lowest price. But consumers are also known to choose higher priced goods and services simply because they believe that higher priced good and services must be better –or superior to their lower priced counterparts. This is called “Price-Value Bias”
Psychologists Daniel Kahneman and Amos Tversky were the first to develop theories about heuristics and cognitive biases. Heuristics are subconscious mental shortcuts that our brains use to create our beliefs and judgments for various instances in our daily life. A short and representative example is the so-called irrational value assessment. If you pay a lot for a bottle of wine you have never drunk before, you will probably like it much more than if you paid just a few dollars.
Interestingly, one of the follow-up studies in this paper found that when participants are made to believe that price is an indicator of a product’s ease of use (as opposed to its level of functionality), they tended to choose the simpler, easier product.
In sales, the perceived value of a product is often determined by the way the price is framed to the consumer: meaning the price can be made to seem much smaller or more attractive than it is.
For example, you could break down your pricing to show how much your product or service would cost per day, or over a year, or over the lifetime of the product which makes the price seem much less than it actually is.
Similarly, the price can be reframed by simply changing the price tag from $100 to $99.99. The difference is only a penny but in the mind of your customer, it becomes a much more attractive purchase.
Beware of the words you use!
The way your prices are worded can also have an effect on the customer’s value-perception. For example, you may find that avoiding words like “discount,” “reduced pricing,” “bargain,” or “closeout” because, in some customer’s minds, these words have negative connotations, making people believe that the quality or value of the product isn’t as high or as good, or as functional.
Instead, try framing your products and services to appear more expensive than they actually are. This can help grow your business’s sales because higher price tags usually convey an intrinsic sense of value. If you’re charging more money for something, people will naturally assume there is a reason for this and attach a higher value to that product. It’s important therefore in marketing your product to really know who your target audience is to understand what type of Price-Value Bias they will be susceptible to.
Are you Trending?
In order to make sales, you have to get your product or services in front of your customers. They can’t buy what they don’t know about. And how they find your business is all about perception.
Perception has several stages.
Stage 1: Exposure – sensing a stimulus (e.g. seeing an advertisement)
Stage 2: Attention – an effort to recognize the nature of a stimulus (e.g. recognizing it is an advertisement)
Stage 3: Awareness – assigning meaning to a stimulus (e.g., a humorous advertisement for a particular product)
Stage 4: Retention – adding the meaning to one’s internal makeup (i.e., the product has fun advertisements)
Popular culture, peer groups, and the various social media channels all play a very prominent role in why consumers buy today. And while some trends will come and go, many others can be transformative and could have the potential to change the market forever.
Consider what it is about your offer that makes your business stand out.
What is it that differentiates you from your competition? If your offer sounds an awful lot like everyone else’s, it may be time to change your ‘Unique Sales Position.’ It may even be time to hire a spokesperson, or social media influence-marketer to promote your products and services targeted to your particular audience.
Follow these customer engagement recommendations to improve sales:
- Listen to your customers and prospective sales leads
- Identify their needs
- Present your products or services in a way that genuinely fulfills their needs
- Eliminate the hype (be genuine)
- Stand behind your products and services
- Create an emotional connection with your customers
Generate more sales by knowing the reasons why your customers buy from you in the first place.
Once you understand the WHY of your customer’s purchasing decisions, you can then re-frame your products and services to highlight their ‘Perceived Value’ –adapting your Brand’s message to better suit your loyal followers.
Stay on top of trends and be aware of the social media channel(s) your customers use regularly. Your customers are making decisions based on their emotional connection to you, your business, your Brand and of course your products and services. The most economical (cheapest), or most logical choices don’t always win.
Today’s consumers are smarter and more informed than ever before. Consumers don’t always follow a linear path from initial awareness to consideration to first purchase. Many different factors now influence the buying process.
Keep your Brand in front of your customers in an emotionally engaging way. Be genuine in your interactions, and be grateful for the blessings you enjoy each and every day.