You did not start your business to lose money. You don’t just want to break even. You want to maximize your profit margin. You can achieve this by increasing your revenue streams.
As a refresher, revenue is simply the money that comes into the company. Revenue is highly variable and usually shown at the top of an organization’s income statements. It may be positive in some years and negative in others. You want to have as much revenue as possible in order to cover variable costs.
It’s true that boosting revenue is not easy. You might be lucky to enjoy an unexpected increase every now and again. You can’t rely on luck. You need to take some steps to increase your income. You did not start your business to lose money. You don’t just want to break even. You want to maximize your profit margin. You can achieve this by increasing your revenue streams.
1. Reignite former customers.
You probably have some information about your previous customers. You spent money to get these people and they spent money on your business. Why not try to rekindle their interest instead of accepting that they are gone forever?
Think about the number of customers who returned, added items to their digital shopping cart, and then left. Retention.com states that seven out of ten buyers fall under this category. You should use the information you have on them to get them to reconsider. As a reminder, you could send them texts, emails, or even DMs. You could also try a retargeting program.
You won’t be able to bring back everyone who left, but you will get some of them back. Your revenue will increase as a result. You’ll also have the opportunity to renew your relationship and business with these “boomerang buyers”.
Also read: How to Value a Startup Company: Top 5 Method
2. Expand your product or service line.
Many businesses looking to increase their revenue invest more in expanding their product or service offerings. To make this work, you need to ensure that your new products or services are relevant. An e-store that sells winter recreation merchandise to adults would not want to include wedding gowns in its product line. It would be impossible to reconcile the two.
The same company may also want to add pet outdoor winter equipment and supplies. Most people bring their dogs and cats with them when they go on trails, hikes, or other excursions. It makes sense to offer customers the opportunity to keep their four-legged companions comfortable.
Do your research and don’t follow your gut instinct if you decide to go this route. After all, you’ll have to spend money upfront, so you want to minimize your risk. Doing your research and expanding deliberately is the easiest way to achieve this.
3. Reduce sales friction points.
Inversion is a common feature of a typical sales funnel. Some leads start to leak out as they move further down the funnel. It’s normal and expected. It doesn’t give your revenue a big boost.
Walk through the entire sales funnel with your team. Compare the data with those journeys. What are the areas where you notice a major drop in leads? These are the gaps. If you close them, you will see an increase in conversions at the bottom of your funnel.
Consider working with a marketing specialist if you are unsure how to fix a friction point. Spending money on doing things right the first time is worth it. Make small, testable changes if you prefer to do things in-house. Do not try to fix all of your gaps at the same time. You may not be able to tell which strategy will yield the best results.
4. Work harder on cross-sells and upsells.
Statistically, consumers who are satisfied with their experience spend 140% higher on purchases compared to those who are not. Although they may not know what other products to buy from your catalog or online store, they will be more likely to do so. By using cross-selling or upselling strategies, you can introduce them to other items.
Cross-selling is when you sell something that’s compatible with the product a customer has purchased. A consumer buying a sofa might also want an ottoman, side table, floor lamp, or chair. Upselling is when you sell something more expensive than what the customer initially selected. Upselling is adding extra cheese to a burger or adding sauteed mushrooms for a fee.
There are many software programs that can automate cross-selling, upselling, and other sales processes. The software, which is usually enhanced by AI and ML predictive technologies, can “fetch”, cross-sells, and upsells. Cross-selling and Upselling, when done correctly, can have a significant impact on your revenue rates.
5. Consider a subscription model.
Subscriptions are another way for your business to earn a little bit of steady income. Any product or service can have a subscription component. It’s for this reason that the average person spends over $200 per month. It’s important to make sure your subscription is valuable enough for customers to continue paying.
Subscriptions are profitable in part because most people set them up and then forget about them. Most people don’t use subscriptions as they expect. It’s because no one cancels a gym membership in February, even though they haven’t been going to the gym since mid-January.
Your subscription can be as creative as you like. You can do anything. Who could have imagined that clothes would be a delight for subscribers? Or that men would want grooming products for their men? Who are they? StitchFix, and Harry’s razors. Be open to new ideas.
6. Consider a new audience.
You may not have fully explored all of the potential audiences for your brand. It could be a niche audience that is a subset of your current audience, or it could be a totally different audience. Your revenue can be boosted by capturing another market.
Not sure how to find new audiences? Start by doing some social listening. Find out what customers say about your product on the internet. Find out what your customers are saying about the products of your competitors. You might find hidden audiences you have never targeted.
Lucky Charms realized that it was not marketing to a large segment of consumers. adults enjoy the marshmallows as much as children do. Lucky Charms’ ads have been more adult-friendly for a decade. Its revenue is no doubt a reflection of its sweet discovery.
Also read: How to Increase Your Brand Visibility Online: Top 13 Tips
7. Improve your brand presence.
You can’t expect people to give you money if you don’t exist. Your company’s name can be brought to the attention of consumers by putting a strong push on your content marketing and public relations messages. Your brand will become more and more synonymous with your products or services the more it is used.
Social media is a great way to quickly establish your brand’s presence. You can gain some momentum by staying active on social media sites that your target customers use. Just make sure to post and comment regularly. It’s not only about sales but also engagement. The more you give and take, the more buzz your business will build.
Influencer marketing and paid advertisements can help you increase your social media presence. Using ads, influencer marketing, and organic content will help you build credibility. You’ll end up with a nice boost that will hopefully translate into increased sales.
8. Adjust your pricing.
Your price points can affect your revenue. Take it into account, even if you are hesitant to change your price. You should never assume you will lose customers by increasing your price. Customers who are happy with your product or service will be willing to pay a bit more. customers rarely leave, as noted by The New York Times.
A word of caution, though: If you have regular clients, be careful not to raise prices without notice. Customers who purchase from you regularly will notice the price increase faster than those who only buy occasionally. Notifying customers that prices are going up shows you care about their needs. It also makes customers feel that you aren’t trying to get away with something.
Still, feeling uncomfortable at going higher? Offer your most loyal customers the chance to buy at a low price for a limited period of time. You can also keep the price of items at the same level when purchased in large quantities.
You have greater control than you thought over the revenue of your company. Take action right now if you want it to increase. You could become more successful and profitable with a few changes.
