COVID Funding Tips for Small Businesses
With the economic environment and technology changes, you must look at new strategies and some twists on old strategies to access more money for your business. Cash flow is king, and it is a must.
Let’s start with the easiest and fastest way in which is to raise your prices.
That is not a new idea by itself, but how you go about raising prices, the reasons for such is new.
You already know that if you want to bring 10% more to the bottom line, raise your prices by 10%. If you do the opposite (which many do in this economy), you will lower your bottom line by 10%. That can be very bad if you are already losing money.
One part is to be very clear on your cost of goods sold and your profit margins on different products and which products or services will lead to upsells and more customers.
The key is how you go about raising your prices and how that is presented. /
Here are some tips for doing it effectively:
- Bundle other services together (especially one with a higher perceived value and low cost) and develop a new compelling name for that new bundle of services and packages. That is a clever way of raising prices.
- Emphasize a new improvement in your product or service, which could be speed (people will pay a premium for that) or performance or service advantage. Perhaps you are already doing things fast, but maybe you create an actual service for “express service” vs. regular service and give your customers an option for speed. I have always suggested this to my CPA to charge an “expedited tax service,” especially those who wait the last night to get all their tax information to them. It is a clever way to raise prices.
- Change the “Who” you are selling to so that the market may be thinking your prices are a bargain. This works well when you start selling to the affluent market. Search Dan Kennedy, “No BS, Marketing to the Affluent.” If you only have “cheap” customers, it is most likely because that is who you are marketing to. Your marketing materials and sales copy may lead people to believe that your products and services are lower-priced, which may be why having an issue raising your prices. Just model some of your industry products or services that are higher end and look at their copy, websites, and marketing materials and see where you can improve.
Master up selling at the point of sale is a must (the key is how you go about it).
I would guesstimate 90% of small businesses still don’t do it. Big businesses get this! You can’t go to a Walgreens to get gum, a birthday card, or some cough drops to go through the checkout counter only to be asked if you would like a candy bar with your cough drops (which makes no sense).
An improvement would be a better matched upsell based on what is being purchased, like a vitamin C packet with the cough drops. But at least they are doing it. McDonald’s does it, banks do it, and almost every major company will ask you for a small upsell at the point of sale!
That small upsell ad up, and you need to figure out that every product you offer what small or large upsell can you offer on your website or when your clients or customers call you.
You must train and MEASURE (otherwise nothing will happen) with your team, which is now mandatory.
You may give rewards for the most upsells in a month (a great way to start the momentum). You may need to actually script this out for your staff, for a couple of reasons, one to be consistent, and second to test what is working or not!
Better bundling will lead to more profits! You can offer one product with another. You have to work on bundling and ways of positioning complementary products together.
I would recommend you develop a new creative name for the new bundled package that gives an implied greater benefit vs. the standalone product or service.
You can also use Amazon’s model when someone buys a book or product; they share the most common other books or products bought by someone who made the first purchase. They are testing to see how often that triggers someone to buy a second or third product. Did you ever buy a domain on GoDaddy®? You are presented with so many upsells and bundle options.
This is very similar if you buy a plane ticket on Orbtiz®. There are several packages and bundled options. But are you doing this in your own business? If you are, congrats!
Now, what can you do to improve what you already have working? Are you testing names, combinations, copy, graphics?
You may be not doing this, and this is a must to maximize your results. You must test and see what will work better to make those improvements. We started doing this again on one of our websites and tested three different landing pages, and one out pulled the other by 4x the amount! That is huge over time.
If you are not getting many companies to promote you to their list at no cost to you, look for a smaller win. Perhaps you can trade a banner post on each other’s blog.
Perhaps you can trade a “P.S.” in an email blast you are both doing to help cross-promote. If you each have a loyal following and valuable list, why not cross-promote! You have to be the one suggesting new and simpler methods to JV.
You may even hire someone to make JV calls on your behalf to set appointments. If you have someone doing that now for new clients or customers, why not have them spend 1/5 of their time making calls for JV opportunities for your business. That is what we do at NCP.
How many referral programs do you have in place?
Do you have one, two, five, or more? How do you promote it? Do you email your list?
I like the headline, “Did you receive your check”? Most people will want to open that to find out if they were due a check.
Then you can tell about how many checks you are sending out and that you are not on their list, and how you would like to send them a check each month for referrals. This is a must, must, must for your business to bring in more money.
Not everyone wants money for a referral so that you may test. Instead of always telling about how much money someone will get, let them know that their friends and associates will be in good hands when they refer them to you and take great care of them.
That may resonate more with a list than the actual referral fee part. Model other companies outside your industry with their referral programs and find out how you can do more. I have realized lately that one of our competitors has many different referral programs depending upon if you are a professional or not. They created brilliant categories, and we are looking to model that. You should do the same!
No reason to reinvent the wheel. Implement and do it!
Move the free line. A phrase coined by Eban Pegan, a great online marketer. His point is to give away some of your best stuff free. That can be in a video, a free report, or a blog post. Most people think, why would I do that? You are doing that to get more followers and customers.
Let me ask you this when Lady Gaga releases a new album does she release first her best song on the album or the worst song? She releases her best song, gives that away so now you really want the new album.
You should consider the same approach and test, giving away part of your best stuff, and see what kind of response you get with your current list!
The next step is simple, take action! Write down one or two ideas from each group and a deadline to implement and put it on your marketing calendar and computer.
Take the 5-10 minutes to brainstorm now with a date for implementation. It does not have to be perfect, but you do have to take action now.