Bad news. It is not the economy. Your competitors have the same opportunities, products, and services as you. Even in this economy, your competition is somehow gaining ground and leaving it behind.
What are they doing that you are now?
The number one small business mistake is running a front-end-only business.
What is a front-end exclusive business? A movie theater sells a ticket. He sells you candy, popcorn, and drinks. So far so good.
Then when you leave, they are counting on you to come back on your own. The theater doesn’t know how to get in touch with you … not at all. They just made the most common American business mistake.
No phone number. No twitter. Without direction. No email. Nothing.
Even in this very connected age, they have no way of communicating with you. Even if they executed your credit card, they still do not have your information and cannot contact you. Your favorite cinema cannot send you a coupon. They can not. Not without sending one to everyone.
Is your small business like this movie theater? Are you unable to collect some kind of contact information? Do you have an empty database? Do you keep in touch with your customers?
Without a back-end built into your business, you have to face the high cost of acquiring new customers. Once your competitors learn this trick, they will have all the extra money they need to spend more than you on advertising, bonuses, prizes, contests, giveaways, and whatever else they want.
Worse than that, you’ll be gifting all of your customers to your competitors on a silver platter.
What is a dirty backend?
An example of a fund sale is after you buy the printer. Now you have to keep buying ink for your printer. Instead of just pouring in any generic ink, you should buy their high-priced ink cartridges. They can even afford to sell the printer for no profit because you will have to buy their expensive ink for years.
But the printing company still does not collect your information. They are not building their list. They are still unable to contact you to offer you additional service, printer upgrades, ink and paper upgrades, or other office supplies.
What do they have? A Web page. A customer must initiate contact and go to the website. That is not a back-end strategy. They are crossing their fingers again. They wait for people to come.
A back-end means that you proactively open a communication channel. You actively send offers. Provide information, service and actively send surveys. You are interested. You develop a relationship. You can provide satisfied customers with exactly what they want year after year.
You need a list. If you don’t have a list, how do you change things?
Years ago I had a friend with a garage full of couture designer shoes. She and her boyfriend had attended an exciting home business seminar. Found out how to wholesale lots of designer shoes. She decided to sell shoes online, but quickly found that she was costing more to sell those shoes than she was making from selling upfront.
He discovered that he was not going to cover the expenses. It was going to cost him money to sell shoes.
Now he has a garage full of shoes. He went bankrupt almost before he started and now works for a computer company.
She didn’t know about backend sales.
What went wrong?
- There was nothing wrong with the shoes. People keep selling those same shoes.
- There is nothing wrong with the online auction. People like you make a wonderful living just doing online auctions.
- There is nothing wrong with the shoe business. People keep buying shoes.
- It is not the economy. Some of your competitors continue to thrive by doing things differently.
So what went wrong with your shoe business? I’ll tell you. He thought he was losing money on sales. I tried to explain that I was buying customers. He was also buying them at bargain prices.
Armed with 2 hours of business education from an exciting home business seminar, she has made the same classic business mistakes as people with 2 years or more of business education. Seasoned entrepreneurs still make these same mistakes in every industry.
It’s frustrating. She was doing almost everything right. Before giving up, she was much closer to financial independence than almost anyone her age. It would have been enough to make a few simple changes to make a good profit on a business he loved, a very lucrative and loyal customer base, and an almost certain fortune.
In fact, you might think about selling your products at a loss at online auctions just to build a list of loyal buyers.
His biggest mistake # 1:
- You forgot about backend sales.
Once people bought her shoes at a bargain price, they could jump into action with a number of low-risk, high-leverage strategies.
Plus, your new list is loaded with assets.
Remove the veil and discover 12 hidden business treasures. Here’s what “losing money” buys you selling those designer shoes:
- Trust, credentials and reputation established in the auction site. (This improves the bidder’s confidence and can help you boost the selling prices slightly.)
- Learn what works and what doesn’t in your market. (This information is a product worth thousands if sold to your competitors.)
- She has a list of online shoe buyers, their names, emails and addresses that are worth their weight in gold when she offers them more, they are more likely to buy from her than from anyone else in the world. (You purchase this list at a bargain price, and you may decide to rent or sell your list in the future.)
- Additional traffic to your website. The auction attracts traffic to your online store.
- An attractive prospect in a shopping mindset. Offer the upsell. Now front-end selling is profitable.
- An opportunity to surprise your customers and generate referral business. It is a foothold in the market.
- The right to respond to hot leads: all bidders and buyers by email.
- The ability to promote your website to negotiate with buyers throughout the auction cycle.
- The ability to appear in Google Shopping search results.
- An excellent reputation as a market performer.
- As a wholesale shoe buyer, you can position yourself as a fashion expert.
- Once her business is successful, she can be the success expert speaking at that same home business seminar.
In my opinion, these twelve assets, properly leveraged, are worth much more than your garage full of shoes. Turning these assets into a stream of income is as much an art form as it is a science.
Your current business may be struggling or underperforming because you are losing your valuable invisible assets. Almost all smaller companies have extraordinary value built in.
Your number one asset is that back-end list. If you don’t have one, you’re throwing cash in the dumpster and letting your competition trample it. I’ve heard some internet marketers say that without a list, you don’t have a business. Create your customer contact list.
