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In my last article about The Customer Journey – Evaluation, I discussed the six key elements of customer satisfaction. You need to excel in, the areas that help Heidi know you offer excellent value, the factors that cause her to choose you. These were: Getting the Job Done, Process, Emotional Gain, Price, Inconvenience, and Uncertainty. […]
| Element | Your Contribution |
| Business Model | |
| Value Proposition | |
| Customer Segments | |
| Customer Relationships | |
| Acquisition Channel - Primary | |
| Acquisition Channel - Secondary | |
| Revenue Streams | |
| Key Partners | Customer relationships: Channels: Supply Chain: Operations: |
| Key Activities | Customer relationships: Channels: Supply Chain: Operations: |
| Key Resources | Customer relationships: Channels: Supply Chain: Operations: |
| Cost Structure | Customer relationships: Channels: Supply Chain: Operations: |
| Unique | Ultra-specific | Urgency | Useful |
| Something different, fun, personality | Be clear what it is about | Are you losing sales? | Benefits promise |
| Sale now on! | Who cares? You're always having a sale, why pay attention this time? |
| free | tends to trigger spam filters (MailChimp) |
| help | tends to trigger spam filters (MailChimp) |
| % off | tends to trigger spam filters (MailChimp) |
| reminder | tends to trigger spam filters (MailChimp) |
| Brand new | +37% |
| Latest | +24% |
| Exciting | +19% |
| The perfect gift | -28% |
| good | -20% |
| special | +12% |
| wonderful | -2% |
Our clients are seeing a 20% increase in CLV year-over-year, as well as an average retention rate lift of 17%. Contact a member of our team to turn your customer data into an actionable lifecycle email marketing strategy and grow customer value for your business.
In our work with many small businesses, we found time and again that people love their business idea, but hate finances and numbers.
Sure, you have to keep financial records for tax reasons and so on, but many have no idea how to use their financial reports for growing their business.
That’s why the small business failure rate is so high - half disappear within 4 years and many of the remainder are stuck earning less than 10% profit.
That is why so many people have feelings of loss of control and dis-empowerment.
We said "There HAS to be a better way", when MILLIONS and MILLIONS of small business are like this.
So we thought:
Then you can enjoy your focus on the parts of your business you love.
Feel empowered and in control again.
That's what neXtep Business Builder Community does for you.
Developer
Cash is the lifeblood of your business and is the first area to manage. Adequate cash flow ensures survival and viability as a business. A good surplus of cash gives you the freedom and options you need to have for a long term plan.
Your first cash flow need is to ensure your sales generate enough Gross Profit to cover your expenses.
The second is to ensure that you are managing the flow of cash into (Receivables) and out of (Payables) your business, as well as what is transferred into a potential asset (Inventories.)
Increase your profit from the components you offer as your product or service.
Your choices mainly involve:
The recommended quick and dirty solution is to increase your prices.
Longer term, the key to successful selling is to align your offer with a job to be done by your customer. When you align this way, and (just as importantly) help your customer produce perfect outcomes from that job, you are no longer selling a commodity. Now your pricing can increase to match demand.
Similarly, you product or service components should only include the elements that help get the job done well. Any more elements don’t add value for the customer and are wasted cash for you.
We include non-cost items such as warranties that impact on the emotional job to be done, of reassurance.
Most Product Area actions are Smart Tweaks, because they convert improvements directly to the bottom line, as increased cash.
Increase your sales and profits by up to 50% the Smart way.
The two key objectives with inventory are to:
The first step in this process is to categorize your inventory.
In most business cases:
| Cat | Items | GPShare | Cum.Items | Cum. Profit |
| A Cat | Top 5% | 45% | 5% | 45% |
| B Cat | Next 15% | 35% | 20% | 80% |
| C Cat | Middle 30% | 15% | 50% | 95% |
| D Cat | Last 50% | 5% | 100% | 100% |
It’s not only inventory in your possession, it’s also about inventory to hand for the customer. Just by improving your in-store replenishment you can generate a typical 17% increase is sales and profit.
More inventory available to the customer also provides a valuable Impulse items sales increase.
Increase profit per customer
Convert awareness of your product or service to a sale.
Optimize that sale.
Focus on helping your customer get their job done and in the process (using a plant nursery analogy), sell the hole and its associated items, not just the plant. The fertiliser, the stake, the gardening gloves, the watering can, the kneeling mat, the sun hat, and the consultancy for garden layout.
That is optimum cross-selling, where your sales efforts are directed to helping your customer get perfect outcomes.
Increase the number of customer orders generated, from your existing customers and from new customers.
Expand your customer base. Promote, use new sales distribution channels, expand your outlets.
The more customer orders you have, the higher the revenue. Your key concern here is to ensure that your growth in revenue is not more than your growth rate of Gross profit and overheads.
How well can your business scale? A business selling online software can scale easily with little or no additional costs. On the other hand, a service provider selling his/her time has very clear scaling limits.
These Actions include some of the most investment-heavy options, and are generally better left until last when your other actions have generated sufficient cash to carry the costs without risks from loans or mortgages.
Every dollar you save in expenses goes immediately to profit. Your first job is to plug any obvious leaks, and look first in the areas of highest variable costs. The 80/20 rule applies here, too. Staff productivity is usually first area of concern.
Actions focus:
| Criteria | Description |
| Market Segment |
|
| Job Executioner or Customer |
|
| Product |
|
| ABC Cat |
|
| Retention Rates |
|
| Loyalty Coefficient |
|
| Channel |
|
| Time critical |
|
There is a lot of information that explains how to segment customers so I will not go into the details. I will, however, highlight three key points for CS teams to consider when looking at segmenting their customer base as part of their customer expansion strategy:
Bottom line
How to Improve Gross Margin Production Without Changing Your Prices or Lowering Your Costs
| Review Period | Lead Time | Safety Stock |
| Action |
General links compendium
https://www.nchannel.com/blog/retail-data-ecommerce-statistics/
| Goals |
| Email Marketing | Triggered Emails Yield 56% Higher Click-Through Rates |
| Email Marketing | 22% of retailers say they don’t send any type of triggered emails. |
| Email Marketing | In 2016, email had a median ROI of 122% — a 4x higher return than other marketing channels. - Direct Marketing Association |
| Shopping Carts | Most retailers that use triggered emails report abandoned cart emails to be the most effective. |
| Shopping Carts | The average online retailer experiences 65% shopping cart abandonment. Of this 65 percent, only 2% of the abandoned carts are recovered - windsorcircle.com |
| On average, just 2% of e-commerce website visitors are expected to make a purchase3 , but 5% will register their email address with your brand4 . The potential is huge: if you attract 100,000 visits to your website per month, that’s 5,000 new shoppers providing you with their information, asking to be engaged. Most marketing experts agree that it takes an average of 7 contacts with a prospect before they’ll buy - when we consider this, we understand thats it’s critical to leverage new email addresses to drive those 7 contacts quickly and effectively. After all, 69% of a customer’s first-year spend comes during their first 30 days as a customer Zaius |
|
| three in every four abandoned carts are recoverable with proper campaign execution7 Zaius |
|
| Personalization | Experian reported that birthday campaigns result in
than standard promotional email campaigns8 Zaius |
| Personalization | Remember, the keys to success are simple - stop treating all of your customers the same, and start using customer behavior to inform your communications with them. This means understanding that email alone is not enough because not all customers respond to email. It means engaging with your customers in real-time, when they’re engaging with you. It means meeting your customers’ expectations of a consistent, personalized experience with your brand across all channels and devices. Zaius |
| referralsaasquatch | |
| “A 5% increase in customer retention can increase a company’s profitability by 75%.” –Bain & Company |
|
| Customer Lifetime Marketing | “80% of companies’ marketing budgets are spent on acquiring shoppers; however, for every 1% of shoppers who become repeat customers, a company’s revenue will increase by about 10%.” –Adobe |
| Customer Lifetime Marketing | “The key to success in CLM is behind optimising for Customer Lifetime Value (CLV) and not conversion rate (CR) or revenue per visit (RPV). This is not to say conversion rate doesn’t have its place – it’s a very important metric in the right scenario. However the hierarchy is what is important. CLV trumps all others as a metric for long term profitability.” –Edward Gotham,Ometria |
| customer experience |
|
| customer experience | “A 5% reduction in customer defection rate yields a 25% – 125% increase in profitability.” —Kapow |
| customer experience | “Companies that prioritize the customer experience generate 60% higher profits than their competitors.” –Kapow |
| customer experience | “A commitment to customer experience results in up to 25% more customer retention and revenue than sales or marketing initiatives.” –Bizsum |
| On average,
• Overall revenue increases by approximately 10% for each 1% of shoppers who return for a subsequent purchase. This means that if online retailers retained 10% more of their existing customers, they would double their revenue. • The probability of selling to an existing customer is 60-70% on average, while the probability of selling to a new shopper is only 5-20%. • On average, returning customers spend 67% more than first-time customers. Zaius |
|
| Loyalty | a “totally satisfied customer” spends 2.6x as much as a “somewhat satisfied customer,” Zaius |
| If online retailers retained 10% more of their existing customers, they would double their revenue Zaius |
|
| Reducing your customer defection rate by 5% can increase your profitability by 25% to 125%10 Zaius |
|
| The probability of selling to a new customer is between 5 and 20%. The probability of selling to an existing customer is between 60 and 70%. [18] It costs 6 times more to attract a new customer than to retain an existing one. [18] Loyal customers are worth up to 10 times as much as their first purchase. [19] 18 - Useful Customer Experience Statistics For Your 2015 Strategy, Neosperience 19 - Powerful Customer Experience Stats for 2015, Christine James of HissingKitty |
|
| Take a look at the figure above. You’ll see that repeat visitors account for just 8% of total traffic on U.S. e-commerce sites. However, they account for over 40% of the revenue generated. Imagine the possibilities if only businesses spent a little more TLC on these repeat buyers, who come back to you right now of their own accord? In its Annual Ecommerce Benchmark Study, MarketingSherpa set out to discover how much it costs to acquire a new customer. Over half of all respondents reported that their new customer acquisition costs had stayed steady across 2013, while a third of them felt acquisition costs were on the rise. The median cost of acquiring new customers according to the survey ranged between $12 and $25. This is five times more than the cost of retaining an existing customer. |
|
| It gets better. The probability of selling to an existing customer is 60-70% as against the measly 5-20% chance of selling to a new one. Repeat customers are not just easier to sell to. They also spend more per transaction than a brand new customer. According to research by Manta and BIA/Kelsey, repeat customers outspend new customers by 67%. |
|
| Research puts the chance for cross-selling success to existing customers at 60-70%. The probability of cross-selling to a new customer, on the other hand, is a much lower 5-20%. ???? |
| According to a Wharton Business School study, 83% of satisfied customers are happy to refer a friend, but only 29% do so. Another study from 2012 shows that a referred customer has a 16% higher LTV. |
|
| 5 Steps toward real time personalization | |
| 94% of consumers do research online before visiting a store | |
| 81% of consumers said they have looked up inventory on a retailer’s website before visiting the store and | |
| 80% are less inclined to visit a store if a website does not provide current product availability | |
| 92% of consumers reported interactive content influences them to make a purchase. | |
| In the past six months, 93% of consumers have reviewed product ratings before purchasing an item 57% of consumers reported that most of the time loyalty drove their purchasing Consumer Trends Report 2017 |
|
| Data Personalisation |
Top 3 Challenges for retailers
|
|
| Data Personalisation | http://marketingland.com/consumers-want-personalization-but-retailers-just-cant-seem-to-deliver-144021
|
KL001_Klaviyo_WP_CustomerSegmentation_Mar_2017_Final.pdf
there’s a big gap between retailers’ intentions and consumer perceptions:
marketers are reporting significant benefits from site and in-app personalization:
Use Device, Location And Other Contextual Data To Make Personalization More Dynamic
successfully connected with your accounting app. collected data and set up your financial metrics. calculated the best activity to start with (you will see Action Plan for that in a minute.) seen how nextep can generate a lot of additional cash for you from just one example activity. set goals in how you wish to make use of your additional cash and time. complete the onboarding process take you forward to the Take Action page, and selection of your first Action Plan.| Invest in technology | Save time - automate, secure, standardise your biz processes, |
| Pay off debt | Reduce your worries and overheads. |
| Employ more staff | Seek people who can add to your business competency and faster growth. |
| Employ a general manager | Reduce your working hours, work ON not FOR your business |
| Early bucket list - enjoy! | Start your bucket list early - like a vacation to a special location. |
| My business name is... | This name will be shown on any reports. |
| My business is located in... | This is your business operating location. We use this location to show relevant currency symbols for your report and forms. If you are an online business, then use the country where you produce your business regulatory reports. |
| People employed (including you) | This information helps us with Action Plan related to you. |
| I’ve been operating this business for...years | If you’re a newbie then we will put you on a different Action Plan track to ensure your cash flow is building well before anything else. |
