What business doesn’t benefit from a quick way to get some cash flow?
Today, I want to share the easiest way to get cash flow for your business. And, this is something you can implement rather quickly.
But first: a warning.
This will NOT work if you don’t already have a going business. And, the more happy customers you already have, the better this will work.
This isn’t for starting a business. This isn’t for businesses who’ve only had a handful of customers. And it certainly isn’t for businesses who’ve burned through customers by abusing their trust.
But if you have a lot of satisfied customers, and you’ve been in business for at least a little while, this will almost certainly work for you.
A quick story…
Back when I was selling IT training, we had a few different types of products.
We had individual training titles. We had package-based training, that was a combination of the individual training titles. And, we had a subscription product, that gave a year of access to all of our training titles.
We also had a “secret” upgrade deal…
I say secret because it wasn’t well-advertised. Few customers knew about it. Not because we didn’t want them to — more because we hadn’t done a great job yet of making it public.
Here’s how the upgrade worked. We’d take all the training you bought in the last year, and apply the money spent on that toward a 1-year subscription to our full training catalog.
We even had graduated credit for training bought two or three years before.
Based on what you’d spent in the past, you could get up to 100% credit toward the cost of a 1-year training subscription.
It was a pretty dang good deal — and our customers who used a lot of our training were really excited about it, once they discovered it.
But here’s the thing…
If you were in the customer’s shoes, you could spend $299 here, and $499 there… And another $299 over there… On all our different training… And still not discover that you were almost 100% of the way toward a free year of access to all the training.
We’d done one thing right. We’d packaged up our products to give customers ever-increasing opportunities to get more value by spending more.
And frankly, it’d done wonders for the company. The average customer value pretty much doubled when packages were first introduced. Then, when the subscription was introduced, it doubled again.
We were doing great, almost in spite of ourselves!
Because when a customer got on the phone with us, we would do a great job of showing them the ascending series of values they could get, depending on what they were willing to invest in their professional development.
The thing was, that conversation was never done in a more scalable way, such that ALL customers who it could benefit knew about it.
Especially not the upgrade offer. Again, it was secret — to find out about it, you literally had to be on the phone with us, tell us about your past purchases, and ask us about the subscription product.
That’s when I had a light bulb moment!
I was pretty good with the database at that company. At least pulling marketing information out of it.
So one day, I sat down with the help of our tech team, and cranked out a database query.
I was able to spit out a mailing list of all the people in our customer base who would qualify for a credit to upgrade to the subscription product.
And I sat down and wrote out a quick letter.
“Please call to redeem the credit you’ve earned,” it said.
It went on to explain our “secret” upgrade offer. As well as how they would benefit from having the streaming subscription.
It also asked that they respond by the end of the month. (It was a really weak deadline.)
It really wasn’t very well written.
I wasn’t nearly as sophisticated of a copywriter at that time.
And, I wasn’t nearly as sophisticated of a marketer, either.
I literally sent out the letter one time.
It went out to about 1,000 people.
We didn’t spend more than $1 per letter. And it generated about $12,000 in sales.
That’s $12 in revenue for every $1 spent.
Not only that, most of these were heavily-discounted subscriptions. And with an average 85% renewal rate, the recurring revenue would stack up.
And based on the nature of the product, about 80% of that revenue was margin — so we’re talking close to $9,000 in pure profit.
I could do so much more with that offer today. But that’s not the point. It was fast and easy revenue.
And, it points to a bigger lesson…
In your past customer base, you have a number of people who’d be more than happy to do business with you again, right now, if given the right offer…
Here’s a few thoughts on what made the offer above work pretty dang well, by its very nature…
First, it was an easy way to get a lot more value by spending a little more. The subscription product was great in that regard. It made it very easy to sell. But the bigger lesson here is that you can’t just ask people to spend more — you have to find a way to offer enough value to make it highly-appealing.
Second, it honored the past relationship. The letter I wrote, though simplistic by most pro copywriters’ standards, did this incredibly well. It acknowledged their past purchases. It thanked and honored them for their previous business. And it offered unique and exclusive treatment based on their prior relationship. You have an existing relationship with your previous customers — it can benefit you tremendously to acknowledge and celebrate that.
Third, it was inherently time-limited. Like I said above, I asked them to respond by the end of the month. That was because a very small number of the customers receiving the letter would have their credits drop in value or expire at the end of the month. I could have done a lot more to up the urgency on the offer. But even that nod toward urgency in the letter helped close a lot of sales before the calendar month was done.
So, my question to you: what can you offer past customers that gives them a lot more value by spending a little more, honors their past relationship with you, and has some kind of time or quantity limitation to spur immediate action?
Find your offer, and make it…
Perhaps the biggest takeaway out of the above is that I sent the dang letter.
We had this program going on for years before me sending the letter. There were other people in sales and marketing who’d never sent anything similar. Even after I did it and they saw its success, they didn’t repeat it.
The trick to making anything happen in business or in life is to do it…
Even if you fail, it’s an opportunity to learn. It’s only in not taking action or giving up that you truly experience “failure” in its traditional sense.
So — if you want fast cash flow for your business, figure out an offer.
Make it something that will add value to your previous customers’ lives. Preferably, make it something that costs more, or offers higher margins for you.
Then, reach out to your past customers. Make them a deal, and make it clear that they’re getting the deal based on your pre-existing relationship.
Give them a time to reply by in order to take advantage of the deal.
And tell them how to respond.
It’s not complicated. It’s not complex.
In fact, it’s rather simple. We were able to literally print the letters and the envelopes in our office, where we stuffed and stamped them ourselves. (In hindsight that was stupid and we should have used a print shop — but such is the nature of small initial tests.)
The most difficult part of it is actually taking action.
But, when you start counting the new cash flow coming in because you make offers like these…
Well, that’s when it really pays off.
Yours for bigger breakthroughs,