If you own or run a business, you've probably pondered the question - how can I increase revenue at my business? Many companies run on razor-thin margins, and increasing revenue by even a tiny amount can be huge for keeping the business operational.
There's no one-size-fits-all solution when it comes to growing revenue. Businesses are unique, and the circumstances of one business can deviate heavily from the circumstances of another. However, some solutions will work for the majority of companies. Let me tell you about three ways businesses can boost revenue, and hopefully, one of these strategies will be a good fit for your business. Let's get into some methods for raising revenue at your business.
One method for raising revenue at your company is to increase the number of customers you have. It makes sense, right? More customers means more money spent at your business which means more revenue. The tricky part is how to gain more customers.
There are plenty of strategies out there on how to gain more customers, but my personal favorite is an old-school idea - referrals. With a referral program, you'll incentivize your current customers to refer new customers to your business in exchange for store credit, discounts, or something else along those lines. The beauty of a referral program is that it's hardly any extra work for you; your current customers will be the ones introducing new customers to your store. Forbes called referrals "the most valuable forms of marketing," and for a good reason. The statistics below from Social Media Today illustrate why referrals are so valuable to businesses.
- 78% of B2B marketers say that referral programs generate good or excellent leads.
- 60% of marketers say that referral programs generate a high volume of leads.
- 54% say that referral programs have a lower cost-per-lead than other channels.
- Marketers rate referrals as the 2nd-highest source of quality leads.
However, keep in mind that you'll need your customers to buy into your referral program for it to work. To achieve that, you'll have to provide them with an incentive that makes the referral process worthwhile for them. You know your customers better than anyone, so only you can determine what the incentive for giving referrals should be at your business. All in all, when done correctly, a referral program can help you increase customers, which will lead to raising revenue at your company.
Increase the Size of Transactions
Another approach for raising revenue is to increase the size of transactions at your company. For instance, if customers spend $10 on average when they come into your store, you should aim to increase the size of that transaction in order to increase revenue.
Increasing transaction size isn't easy, but it can be done. Fast food restaurants have gotten supremely good at this; you've likely experienced it without even realizing it. After you've recited your order to the attendant, many fast food places will respond back with, "do you want fries with that?" Just asking that question has made fast food chains like McDonald's millions. This strategy is known as upselling, and it can be effective in your business.
One great way to upsell is with gift cards. Not only are gift cards the most profitable product your business can sell, but they are often bought impulsively. That means customers didn't come into your store intending to buy them, but do so anyway. You can strategically place gift cards or other products that are common impulse purchases near the checkout counter to maximize exposure and increase sales.
Similar to McDonalds, have your employees ask customers if they'd like to add a gift card to their order at checkout. This tactic is another way to increase awareness for your gift cards and give your customers another opportunity to purchase one, leading to raising revenue.
Most businesses are extremely cautious about raising prices, worried that the price increase will lead to an exodus of customers. However, under the right circumstances, raising prices can be an effective technique for raising revenue.
Understand that by raising prices, you'll likely lose some customers. It's unfortunate, but that's the reality. However, you can avoid major customer backlash by being upfront about your price increases. Don't try to sneak them by your customers; they will notice, and they will be upset. Instead, make your prices known and embrace them. If you're really worried about losing customers, you could consider offering price breaks for different volumes. For instance, if someone buys in bulk, they receive your old price. Volume-based pricing can still boost revenue while also offering customers a price they are used to from your company.
Raising prices can have a significant impact on your business. Before you decide to raise prices, be sure to conduct an analysis to see if raising your prices is right for your company. You can also look into your competitors' pricing for more research; be cautious about raising prices too much higher than the competition.
If you do decide to raise prices, lean into the unique things that make your business special. Most of the time, people won't go out of their way to purchase more expensive goods and services. However, if your business has other outstanding qualities, some will overlook the higher prices.
Be prepared to explain your price increases to your customers. As previously mentioned, they're going to notice, so if someone asks, be straightforward with them. No one wants to raise prices, but sometimes it's a necessity.
Hopefully, one of these methods of raising revenue will prove effective in your business. If you need any help marketing your business with custom marketing tools like business cards, gift cards, referral cards, or more, the experts at Plastic Printers can help! With over two decades of experience, we can tackle any project you throw our way. Please reach out if you need anything; we're happy to get you the marketing tools your business needs to increase revenue.