Do You Have A Great Backend? By Chuck Mathews | Posted December 8th, 2007
People are always coming up to me and asking, "What can you tell me to help increase my Internet marketing sales?"
All too often, when I ask them to tell me about their business models, I discover they’re selling only ONE product.
So I ask them, "Have you ever considered selling backend products to your customers?"
Backend products are simply products you can offer to your existing customers, after they’ve made their initial purchase.
Because you know what they’ve already bought from you, you should have a good idea of other things your customers like to buy. And that should make it easy for you to think of new things they’d want to purchase!
Backend products can be anything you think your target market might be interested in. For example, if your site sells cameras, new products could include:
- Add-ons like wide-angle or telephoto lenses for your cameras
- eBooks that teach people how to take better pictures
- Other complementary products, such as camera cases or tripods
The brilliance of this strategy lies in the fact that you already know what your customers like to buy! So you can easily create highly targeted offers for them — leading to higher conversion rates and more sales… and more money in your pocket!
The truth is, if you’re not following up with your customers and targeting them with highly appealing backend products, you’re losing out on a TON of profit.
In fact, by adding just ONE more product to your site, you can increase your revenues by 30% to 50%!
You need to think "lifetime value" rather than "single sale"
The other day I got an email from Amazon.com telling me about a new Internet marketing book they just got in stock.
They knew I might be interested in it because I’d bought other Internet marketing books from them before. (Hardly surprising, right? 
And I was interested in that new one, too! In fact, as soon as I got Amazon’s email, I immediately clicked through to their site, checked out the book, and bought it!
And in doing so, I boosted my "lifetime value" to Amazon by another 20 bucks.
Lifetime value is simply the income generated by a single customer over the course of your relationship with him or her. If you sell only one product, then your customers’ lifetime value will be limited to the net income that comes from a single sale of that product.
But if you sell a wide range of products, your income will grow exponentially!
And selling to existing customers is easier and cheaper than selling to strangers because you’ve already cultivated a relationship with them:
You’ve put in the time and money to…
- Get their attention
- Establish your credibility
- Build their trust in you
- Overcome any resistance they may have to buying online
- Close that first sale
On top of that, you now know what your customers like!
So, after that, it’s much easier to sell to people a second time… and a third… and a fourth… and so on.
Reward your customers for being loyal… they’ll reward you by becoming even more loyal!
Take the book I bought from Amazon… all they had to do was send me an email about a product they thought I’d like, based on my previous purchase history. They didn’t have to sell themselves as a company to me because I’ve already bought from them before.
In fact, I’ve bought maybe one book a month from Amazon over the last five years at an average of $20 each — meaning my lifetime value to them so far is $1,200!
And it’s much easier — and way cheaper — for Amazon to sell me 60 books at $20 each than to persuade 60 new customers to each buy one $20 book.
When to follow up with your customers for maximum returns
The best time to offer your customers backend products is when you’re given a natural opportunity to follow up with them.
Here are some examples of what I mean: You can…
-
Follow up after a purchase: Right after someone buys from you, you can send them a "thank-you" message that includes an offer for a related product. For example, if you sell project management software, you could offer your customers an eBook that gives them advanced project management tips and techniques.
Or, if you sell "how-to" guides that teach people how to build their own sundeck, you could offer customers a special package deal on the tools they’ll need for the job.
- Follow up on a purchase anniversary: An easy way to get a follow-up promotion in front of your customers is to send them an offer one month, six months, or even a year after they made their first purchase.
Email them to ask how they’re enjoying the product, and let them know you’ve got similar products available at a special discount price that’s being offered only to previous customers.
- Follow up whenever you can provide new products or information: If, for example, you sell snowboard equipment and clothing, and you’ve just received stock of a cool new snowboarding jacket, you could contact your customers who bought a snowboard or boots and offer them a jacket at a special discount.
They’re obviously snowboarders, so there’s a good chance they’d be interested in a new jacket.
The important thing to remember is, the backend products you offer HAVE to be things your target market is going to be interested in.
The bottom line is, if you’re not offering backend products to your customers you’re losing out on 30% to 50% more income.
That’s because if you sell only one product, your profits will always be limited by the number of new customers you take on.
It takes a LOT more time and money to acquire new customers than it does to sell new products to your existing customer base, so selling only one product can really eat into your profits.
Because you know what kind of products your customers like, it’s easy to create brand-new backend products that complement your existing products, or join an affiliate program and sell other people’s products.
And if you segment your customer list to target focused groups of customers with products that will appeal specifically to them, you’ll show them you understand their particular needs — and they’ll thank you for it by buying more products from you, and staying loyal to your business for years to come!
So that’s why, when I’m asked, "What strategy will most help increase my Internet marketing sales?" my answer is always… "Backend selling!"
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