Future Money, Today?
How would you like to make money today from what you will sell in the future?
Think of it as being able to travel into the future and borrow money from the sales your future self is making. Does that sound interesting to you?
Well, pay close attention. Because even though this sounds like a fantasy, it’s a reality. It can all be done by making a simple offer to every customer.
I will explain what I mean in the true story you’re about to read.
But first, let me remind you of something I said in a previous article about the 8th marketing fundamental you need to succeed in 2021.
I said, “…it’s during that purchase that many companies miss a huge opportunity. That’s why the 8th marketing fundamental is upselling.”
– The 8th Marketing Fundamental You Need to Succeed in 2021
I wanted to remind you about this quote because today I’m going to continue to reveal some things to you about upsells. I’m particular, I’m going to show you a powerful upsell you might be overlooking.
An Ingenious Upsell Offer from a Local Burger Joint
The other night, my family and I were out driving around and decided to grab dinner.
The original place we planned on going to wasn’t available so we decided to drive around to see what else we could find.
We ended up trying a burger place I’ve seen many times but never tried: Big Bun Drive In in Boise, Idaho. (It’s been around since 1954.) I got a bacon cheeseburger that was really good.
But what impressed me even more than the burger I got was the upsell offer that the guy over the loudspeaker made to me.
–This Section is for Any of You Who Aren’t Sure What Upselling Means–
What is Upselling? – I consider upselling to be when you encourage customers to purchase an additional or comparably high-end product or service they need or want, while they are in the process of purchasing a product or service from you.
There are three key things that I want you to notice in my definition:
1. “related to the product or service” – I consider an upsell to be an offer that encourages the purchase of something related or connected to what’s being purchased.
2. “need or want” – You should never offer anyone something that isn’t needed, helpful, or not wanted.
3. “in the process of purchasing” – Finally, I consider upselling to take place while a customer is purchasing from you. It’s not an offer made after the sale is complete and your customer has left your website or place of business.
—
The Ingenious Upsell Offer They Made Me
As I finished my order, the young guy on the other end of the speaker asked me an interesting question….
He said, “Is this your first time here?”
I said, “Yes, it is.”
He replied, “Well, we know you’re going to like what you’re about to eat. So we’d like to offer you a $25 gift card – that you can use the next time you come in, for only $20.”
I didn’t take his offer but I was still very impressed by it. Let me explain why:
- He was encouraging me to come back and purchase again in the future by making me an offer today. (It was essentially a 20% off offer on my next $25 purchase.)
- Unlike Big Bun Drive In, most business owners only hope, pray, or wish that customers come back. They don’t give their customers any incentive to actually come back.
- He was making an offer that enables the business owner to literally collect money today for a purchase that will be made in the future. (This is money that can be used today. It doesn’t depend on waiting until the customer is ready or remembers to come back.)
- Unlike Big Bun Drive In, most businesses have to wait until the future to collect any money from their current customers. Think about how unpredictable this typical business strategy is compared to the upsell strategy that was offered to me.
I Know What You’re Thinking
I can read some of your minds right now. You’re thinking, “Yeah, but you didn’t take them up on the offer?”
Who cares?
Not everyone has to take this offer in order for it to still bring great results for a business like this. I’ll prove it to you.
How Much Additional Profit That Upsell Could Bring In
Let’s break down some of the potential numbers so you can see what I mean.
- Restaurant profit margins can typically span anywhere from 0 – 15% profit. (Source: Pos.toasttab.com)
- Let’s say Big Bun Drive In makes 5% profit spent using the $25 gift card. That’s $1.25.
- The average restaurant processes around 47 transactions daily. (Source: Womply.com)
- To make things easy, let’s say Big Bun Drive In makes 50 transactions a day. Again to keep the math simple, let’s assume they make a similar offer to regular customers. (I don’t have the desire or energy to try to figure out how many new customers come a day. Haha.)
- Let’s say that only 20% of the people take them up on the offer.
- 50 transactions x .20 = 10 customers
- That’s 10 transactions x $1.25 in profit = $12.50.
- $12.50 x 7 days a week = $87.50 a week.
- $87.50 x 52 weeks a year = $4550 in PROFIT a year
That’s an extra $4550 in profit a year from one upsell offer. And, remember, that’s assuming a low profit margin and only 50 transactions a day.
Just think how these numbers change if they have a 10% profit margin, have 100 transactions a day, and 25% of people take the offer. (I think that’s $22,750 in profit a year but do the math yourself. 🙂 )
(DISCLAIMER: As of the time I’m writing this article, I don’t know the owners of Big Bug Drive In. I have no clue how much profit they’re actually making. I just can tell that they’re smart marketers.)
Three Important Things to Remember
But don’t forget the beauty of this upsell offer:
- This is all profit that they get in the present without having to wait until the customers come back.
- Not only that, think about how many of their first-time customers convert to regular customers after eating their twice.
- Making this offer doesn’t cost them anything!
But My Business Is Different…
I don’t have the time to explain how and why other types of businesses or companies (online, offline, or a combination of both) can make money with a similar offer.
To show you how your particular business or company could apply this basic idea, we’d have to set up a time for a consultation.
But I will tell you this. Any business can offer a similar offer. You just need to be creative.
You need to ask yourself, “How can I apply this to our business?” instead of thinking, “I can’t apply this to my business.”
Stay tuned. In my next article, I will share some more ideas you need to understand in order to implement the 8th marketing fundamental you need to succeed in 2021.
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