There’s a lot about Amazon you can disagree with, what with reports about worker’s conditions, and the way they create an unfair playing field for many smaller businesses.
But, there’s one thing they do really well – and it’s something that we can all do.
Should do, in fact. If only because of the massive cost-savings.
Besides: you’ve already paid the cost of building up your list of buyers – why not do the smart thing, and leverage that investment already made?
See, finding a new buyer and turning that person into a client, that’s a very costly thing.
If you take all all the time you spent on your business each year, multiplied by your ideal hourly rate, and you add all the expenses that go into running a business, and you divide that number by the number of clients you sign on each year, you get a pretty clear idea of how much it costs you to acquire one single client.
(There’s far more accurate calculations for Cost Per Acquisition, but I’m trying to give an example that also makes sense to business owners who don’t have granular insight into all financial aspects of running their business)
Anyway: whether or not it’s a high cost or low, or it’s offset by the profitability of your services, it’s a hard cost, and… here’s the thing:
That cost will always be higher than the cost of contacting a former buyer, and seeing if they need any more help.
And that – converting previous buyers into repeat buyers – that’s something Amazon does extremely well.
They’re scary good at predicting what an individual will want to buy next.
And of course they would be: they have vast, massive, datasets, with millions and millions of datapoints – and, they have algorithms to analyse that data, and make increasingly correct predictions.
Would be nice, if you could predict with the same level of precision, what your past buyers might be interested in, right?
If you’d have a prediction engine like Amazon’s, you too could show the right people the right offer, at the right time, with the right messaging, and then you’d get more repeat purchases.
But alas… you don’t have Amazon’s dataset. And you don’t have their kind of algorithm, either.
Well no, maybe not.
But there’s one thing that you do have:
Customer intelligence.
You’ve spent however many years, talking to buyers, learning your market, filtering for the right and the wrong buyer, testing offers and pricing and messaging. You’ve paid school money to gather intel.
And put together, there is a LOT that you know about your people.
But, for most of us, the majority of that information is mostly unconscious. All the little details you picked up, all the learnings, all the insights about why people bought this thing or that, at which time, for what reasons… we know, consciously, a lot of it, but a lot of knowledge is subconscious, half-forgotten, never really analysed well or acted upon.
Put together, it’s a ton of info, and it’s not until you start looking at that data (because that’s what it is, even if it’s not millions of datapoints), that you get to do what Amazon can do, in a SMB kind of way: you get to make accurate predictions and precisely targeted offers, to the people who are most likely to want them.
This is why my buddy Antonio and I created a service, where we uncover revenue opportunities hidden in a list of past and current clients.
Basically, we apply analysis and customer intelligence, to map out all the info you might have.
That will reveal segments, and once you see that intelligence get mapped out into those segments, you suddenly realise:
“Holy cow… these people here tend to struggle with those problems, which I can totally solve, and these people tend to be open and eager. I’m going to talk to them, see if they need help!”
See the parallel? That insight, that’s pretty much what an Amazon generates.
So if you have a list of buyers, and various offers to make, and you want to not just blast a general offer message to your own list, but you want to specifically speak to a certain segment that is highly likely to want a specific offer, then Antonio and I basically operate like an algorithm.
We ask specific, buyer psychology-based questions, to help you identify revenue opportunities that are already present in your list, and we give you the specific wording and framing to make sure those people in particular will resonate with it.
Tl;dr: Antonio and I can help you play Amazon’s game.
With this link you can download a PDF that explains a little more how it works: http://martinstellar.com/download/25970/
Oh, and here’s a fun little exercise:
A calculator we built that shows you in just a few minutes how much potential revenue from re-activating buyers you might have.
Give it a try, you might be surprised at the value present in your main asset – your customer list.
Cheers,
Martin
