264 There are Four ways to grow your small business

[00:00:00]

Catherine: There are only four ways to grow your sales in your product business, and yet most business owners only focus on one way.

In today’s episode, we

going to dive

into the four

ways to grow sales, why they’re important and why not every sale is the same, and what you need to focus on to grow your business profitably and sustainably.

Now, if you’ve heard me on the

before, then you’ll know that I’m a big believer that sales are not the only component for success in growing a profitable product business.

In fact, if you

already

subscribed or followed

podcast, then

please go do that immediately and you can make sure you

every single one of our episodes.

So, for example, episode 2

I talk about profit margins and episode 2 62, I talk about cash flow.

So

your sales are

not the only. Recipe for

in your product business. In fact, focus on sales and

focusing

the top line and not the bottom line is going to get you in all kinds of trouble.

But in today’s episode, I [00:01:00] did wanna talk about sales because ultimately, yes, they are the lifeblood of a business, but not all sales are created equal.

In fact, I would go as far as saying that you are not in the business

of getting sales in your business.

You are in the business

of growing relationships with your customers. And before I

dive into the four different ways

growing your sales, I’d like to

just think a little bit about

customer journey

because when we talk about the four

ways of growing sales, it’s related to whereabouts somebody is on their journey with

you.

So the customer journey starts with billions and billions

people in this world who are completely unaware of who you are.

in the nicest possible way, the vast majority of people don’t even know that your business exists. And then somehow, someway through some kind of activity that you have done, you are able to make them aware of who you are.

So now they go from being unaware to being aware and if

doing your

job correctly or they’re in the [00:02:00] market for exactly what it is that you’re selling. Then they will become interested and then they’ll take this monumental leap

moves them from.

from billion, one of among billions and billions

people to do a small subset, and that is they will become one of your customers.

Once they have made that move where they actually

give you their credit card in store, or they enter their details onto your website online, then they are fundamentally

themselves out from billions of other people in this world. One of the key things I’d love for you to keep in mind as we’re going through this episode is

that nobody

likely to buy as,

nobody is as, lemme say that again.

Nobody is as likely to buy from you

someone who’s already bought from you, and that’s gonna be the key when it comes to talking

about growing profitable sales and then once they bought from you once. You keep warming them up, warming them up, and then ultimately they’ll become a repeat purchaser and eventually the [00:03:00] plan is they

one of your superfans.

Now, pat Flynn is an American marketing specialist who has a book superfans, and there’s

concept of what if you had 1000 superfans?

if you had a thousand people

every time you release something, they

were clamoring to buy it. What happens if

had

a thousand people who would tell all of their

and family about your products?

Give them as gifts, leave you reviews, create user

content

for you? What?

impact would that have on your business?

So that’s what we’re really

about here. When it comes to sales, it’s easy to focus on that first initial purchase,

but ultimately what

trying to do here is we’re trying to create super fans.

And that’s what I want you to think about as we’re going through today’s episode.

So let’s start with the first way of growing your sales

and

this is the one that most

spend most of their time on.

and what most people consider as sales driving activities. And that is getting more people to come. When [00:04:00] I talk

people

about their sales, they’ll

say things like,

I

need to

get more eyeballs on the business.

I need to grow my online presence. I need

grow my audience, and so on and

forth.

And that

is really then

what we’re talking about here is the category of activities that moves somebody

from being

completely unaware of who you are to being aware of

you. Now, there are lots and lots of different ways that you

do

this, and

not only could each one of these methods for growing your audience or getting more people to come, not

only could

one of these methods

fill an individual

episode, there

are probably thousands of podcast shows themselves devoted to these methods. We’re talking

about things like social media marketing.

We’re talking

about things like PR and press

coverage, paid advertising, SEO and content marketing collaborations with other brands

And so on and so forth, or taking part in large scale consumer events

or trade events.[00:05:00]

You could also say

like, wholesale is part of

this category of getting more

getting more eyes onto your business,

So as I said, there are so many different ways to do this, and I don’t wanna go into huge amount of depth

in today’s episode because as I said, each one of these categories is enormous, meaty topics that you could focus on. As said, focus an entire podcast

show just on these topics. But what I want you to think about is a couple of things. First off,

One

of my favorite sayings is, there’s only three ways we’re on a only X number of ways to x

Type of episode today.

But, um,

there are only three

ways to grow your audience.

can buy

them, build it, or borrow it. And

that in that means another words. Sorry. Let say this again. Sorry. Lemme say that bit again.

But here’s something that I want you

consider. There are

three [00:06:00] ways of growing your

That’s a phrase that I heard and I absolutely love the way they categorize it. You can

buy your audience. You can build your audience, or you can borrow your audience. So in other words,

buying it,

that’s everything to do with paid advertising or influencer work.

You can build it. That’s everything to do with brand awareness. Building it

your organic content, for example,

building it

your

community and you can borrow it. So that is

basically collaborating with other people and getting in front of their audience. And

for me personally, the one

get most excited about

is when people really.

Lean into borrowing the audience.

that is, in other words,

lots of collaborations with other

that are complimentary, but non-competitive. So for example.

you are an organic baby, skincare brand, and you might collaborate with an organic baby clothing range because you know that their audience is your audience

vice versa, but

you’re not competing with each other.

I [00:07:00] love this approach because

speaks to

all of the great strengths

small businesses. It’s all about community.

It’s all about the most engaged part of your audience

start following them and vice versa. And

it’s all about real genuine connection. One question that

can always ask yourself

repeatedly, every single day of your

life

and beyond is who already has a relationship with the people that I want to build a relationship with?

And if you

asking yourself that question, then you can quickly come up with some ideas for some great collaborations.

So

as

I said, this whole idea about getting more people to come, that’s what really a lot of people think about when they

about growing their sales. They think about their social media, they think about pr. Think about paid advertising and so on and so forth. However,

as much as this is really important, and of course that sales are really fresh sales, fresh eyes are the live blood of an audience of, sorry. And of course, as much [00:08:00] as fresh eyes

are the lifeblood

of a business, this is actually also a very expensive or and or time consuming way

try and

grow.

And

great analogy I heard.

about

type of method is it’s like you, you create a great party, you put a lot of effort into making this the best party ever. And then you spend the whole evening standing outside the party

saying to people,

come in. Come in. Trying to

get more people into

party, and then never actually coming inside yourself and speaking to the people who are

there.

And that to me is a great analogy for how you can get so focused on

to bring new people in. You miss the other opportunities.

So let’s think about the other opportunities. So yes, getting more people

come. That’s number one way. The first way I should say, of growing your sales and the one that most people think about when they think about sales growth.

The second way to grow your sales

is get more people to buy

when they do come, because as we all know. Getting people to see your [00:09:00] business

not mean that they’re

going to immediately buy. In fact, the vast majority of people who see your business will walk away without having purchased anything. So

an online perspective,

conversion rates

2% are fairly typical.

In other words,

if a hundred people visit your site, only two will purchase. And similarly in a physical space, if somebody walks into your physical space. Now, the stat I’ve always heard is 10% of people will buy. But personally

find with a lot of small boutiques, it might be higher, maybe 30% or

1. And so that’s really important to understand what

number is, how many people are buying when they do come and see you, but then also putting the time and effort in to improve that.

Now, if you want a really great podcast episode about improving your website conversion, then we had PIP

web design and things which was epi. Ah. So if you want a really great podcast episode about driving your web

conversion, then check out episode number [00:10:00] 2 57 where we had PIP from web design and stuff, talking to us about how to improve your online conversion.

But just as a general side note, I wanted to really highlight

method as a way

of growing your sales, a real tangible way

growing your sales, because people just don’t tend to think of it.

Okay. Yes. All right. I need to work on my conversion. It’s kind of one of those things that’s on every business owner’s to-do list,

while they. Simultaneously are really

on driving more traffic to their website or to their shop. However,

if you’re driving traffic to somewhere that

converting

very well, then you won’t be getting great

results.

In fact, you’ll be pouring water into a leaky bucket.

So you definitely want to work

your conversion. And

I also just wanna highlight that let’s say you managed to. E up your conversion rate from

2% to 3%, which is a 50% increase.

That in itself will equate to a

increase in your sales because

same number of people coming in,

50% more of them are buying

and [00:11:00] therefore you’re

gonna get 50%

more sales.

So that is a huge potential there.

People

often overlook conversion rate as

that they probably should work on, whereas in fact, it should.

It should be one of

things that you

are most

on, and I definitely recommend that you spend some time each month looking at your conversion rate and coming up with ways of improving it.

If you

are in store, can you get a clicker so that you really get a

sense of your proper footfall or some kind of footfall counter, even if it’s just a manual clicker. So you can start

checking when, what your conversion rates are, what’s standard for you, and trying things to improve it. In the store.

Then there’s lots of what things you can do to improve conversion,

as the layouts. So

people have the information they need to make the purchase?

Are things there that they actually want to buy. So that’s part of conversion is just what are you offering and is it what your customer wants right now?

Definitely good old fashioned customer service can go a long way with

[00:12:00] conversion as well, because if

interact with somebody, you’ve got more chance of finding out what they’re really after and then offering them something fantastic.

So that is the second thing that I want you to think about is getting more people to buy when

they do come, because again, that can have a really profound impact

on

product

business, and especially for an e-commerce business, it’s extremely easy

you

to track. Whereas in bricks and mortar, it’s perhaps a little bit trickier to do, but it’s well worth making the effort so

can start to understand what’s normal for you and then start to improve it. And that is the key.

And because also hand in hand, if you start improving the amount

traffic coming

and improving the conversion rate, you can see quickly how the different ways of growing your sales can compound one on top of the other. Okay, so the third way to get people to grow your sales basically is

get each customer to spend more when they do come.

[00:13:00] Now, I personally think that getting each customer

spend more every time they come

is the biggest missed opportunity for small businesses.

When I moved

from

corporate world.

into

small business world, one of the things that I noticed the most

was just how little focus people

on their average transaction value. That is quite common for me to ask people what their average transaction value is, and they don’t actually know.

And

I

wanted to just take a moment to really highlight why average transaction value is so important.

If you have Shopify, it’s super easy to find. It’s

there on your dashboard. It’s also

known as basket size.

but if you don’t have access to that, the way you

calculate your average transaction value is you quite simply take the amount of sales that you’ve taken over a certain time period and divide it by the number of transactions.

I like

look at this on a monthly basis. Check track it month on month to make sure that you are making positive [00:14:00] improvements.

But for me, this is one of those areas that small businesses, I

miss,

because they either don’t really grasp the

impact of incremental improvement, which I’ll touch on in a minute,

But they also have a lot

people focus in on the fact, oh, well my customer,

they don’t really have

budget, or they’re trying to very

much.

be conscious of people spending and they don’t recognize that sometimes people actually want to spend more, especially if they’re buying something special or some gift for a loved one or a big gift that people have clubbed together to buy.

Often you can go into small businesses and find

there isn’t really anything in that higher price point.

And if you look at the business average overall for e-commerce,

an average transaction value overall for e-commerce in the UK in general is around 75 pounds.

Most

I work with, their average transaction value is anywhere from 25

to 40

That’s probably the most common.

Obviously, if [00:15:00] you’re a higher price point,

selling

jewelry or fashion, then it may well

above the hundred,

But there are lots of

who are selling

gifting lifestyle homewares, and their average transaction value is low comparison to the industry average.

And. I think that a lot of small businesses don’t optimize for average transaction value, and I think it’s a really big

opportunity.

And what I really love about average transaction value as a way of growing your sales is that it’s not about manipulation. It’s not about trying to talk people into buying things that they don’t need.

What it’s about

is win-win situations. So

for

example. If you take

a shoe company, they, if you’re been into a physical shoe shop, they will have shoes at the front and then at the back there will be a

a shoe care section, and this creates a win-win because let’s say that you have bought a new pair of suede shoes and you’ve.

Splashed out on them, and you want them

keep looking their best, [00:16:00] but

you’ve never owned suede shoes before. The fact that they’ve got

perfect product in the back that they recommend for use with their shoes to

protect it

rain to spray on, you know, it’s not gonna mark suede like that’s a good thing for you as a consumer.

That’s helpful. It’s also helpful to the retailer.

because they’ve

bumped up their average transaction value slightly,

And so it’s these kinds of win-win situations

I really love with average transaction value.

Another example is you

about any kind

of toiletry company such as the Body Shop or Lush or Neil’s Yard

or anything like that around

around Christmas time when you walk into those shops, they are absolutely packed floor to

with gift boxes, and there’s lots of different gift boxes, lots of different price points.

but the thing that can, that brings them all

together is

that it’s

super

easy purchase. You walk in,

you

pick up the gift box, you take it to the till

you purchase it.

You’ve got everything that you need for the person. It’s

already wrapped.

All you

to do is give them the [00:17:00] gift. So

it’s a win

you as the customer because life is super easy at a very time, poor time of year, and

and it’s a win for the.

the

Average for the retailer because you better believe that the average transaction value that is in these boxes is higher than the than

would otherwise

be.

So they’ve got you to spend a little bit more extra, but they’ve made your life much easier So. Average transaction value also has a similar impact to the conversion rate.

for example, let’s say on average you

persuaded people to spend 50% more per

then your

sales totally would grow by 50%.

Now you combine that with improving

conversion rate as well,

and before you know it, you have got

some real significant sales

increases because people are converting more and they’re spending more and. Again, you combine that with more people coming, then you can see how

start

to build a real

growth engine.

But even if

did nothing else other

than focus

your [00:18:00] average transaction

value, let’s say you managed to

increase your average transaction

value by 10%. That would be 10% more sales for you overall. With no change to

conversion rate and no change to your marketing.

So this really powerful stuff.

And I would say look at it once a month. Think about what you

1. Think about,

Is the

that could help you? If you’re

a Shopify user, there is, there are loads and loads of plugins to help

create bundles to help you have

extra add-ons,

a checkout,

or

post checkout

so it doesn’t interfere

the buying flow.

If you’re in store, then think

what are on your till points, for example, what are those quick, easy pickups that could add a little bit extra?

And this is

kind

of thing that, you know, big businesses,

they try and ek it up by a pound or 10% or 5%

Because they know that

adding a pound onto every

transaction across multiple stores across multiple months is gonna make a huge, huge difference.

And so they

do things like [00:19:00] map out

religiously what is gonna be on the tills,

gonna be at the checkout points,

so that they’ve got really clear plan

help maximize their

average transaction value. The other thing I love about average transaction value as well is that, again, good old fashioned

service

can really help with this.

It can really help with making suggestions

that are really useful for the customer. They’re gonna really help them, help ’em get the most out of your product.

but it’s also gonna help drive your average transaction value. And then the fourth and final way to grow your sales. Then we’ve had get more people to come, get more

to

buy when they do

get people to spend more every time they come. And then the fourth one is get people to come back more often.

And this goes back to the idea of. Nobody’s more likely to buy from you than someone who’s already bought

you.

You wanna make sure that you love and

cherish your, repeat your customers and

help move them from customers to repeat customers. And then [00:20:00] from repeat customers to super fans.

This

the warmest segment of your audience. This is the people

who love you,

trust you.

and these are

people that you really want to pay some serious attention to.

These are

people

in the party you want

be

talking to instead of always focusing

getting more people to come through the

door. And how do you do this? There’s lots of different ways, but at the heart of it, it’s about how do you treat your VIPs, so the

who’ve already purchased from you and the repeat purchases, how do you treat them

in a way that

better than

somebody who has never heard of you before?

So, for example, when I worked in corporate retail, one of my jobs was to go through all of our

marketing campaigns and to really highlight what it was that we were gonna do that was extra. For our best customers,[00:21:00]

And it was sometimes

simple as saying, right, we’re having a sale. So they get an extra day before anyone else to shop the sale.

They

an extra 10% off at the end of the sale. It’s

a new

season preview, so they get to shop that first before anyone else gets full.

They get full

access to all of the sizes

and then perhaps it was an in-store event

our very best customers to give them a special

opportunity to try things on and to just say thank you.

And I think that that’s really the crucial part here is it’s how do you say thank you to these people? How do you really make them feel

and

appreciated and

encouraging them to come back? Email, sorry, lemme do that again. Lemme just turn my phone off.

Email [00:22:00] systems like Kavio are brilliant for that because you can tag people depending on how many times they’ve purchased from you, and you can help create a really great experience

them.

Loyalty schemes equally something

can really help

you reward your best customers, so definitely look

those best customers and make sure that you get them to come back and buy more often.

So there you have it. We have got our four ways

growing

your sales, getting more people to come, the one that most

focus on, but is the most

expensive and difficult to do. Getting more people to buy when they do come, which is

sure that you’ve done everything you can to improve your conversion rate.

Getting people to spend more when they come, which is everything to do with your average transaction value. Great customer service suggestive. Selling. In other words,

might also like

this, thinking about ways that you can

products together, thinking about ways that you can make it easier for people.

Think about ways you can have bundles as well,

just to really make things easy, but then also[00:23:00]

have those extra add-ons, which can over time compound to make some really big differences to your sales.

And then finally, getting people to come back. Which is all about treating them really well. So you’ll see the big theme of especially two, three, and four.

A lot of it’s about great customer service, being there for your customers,

answering their questions, being just a genuinely

great business

to work with. Then of course, having great product that really is a testament to your business, that’s also gonna help a lot.

So lots to work your way through here, Ann.

I would love to say as well, if you want more help with growing

sales, I have a brand new freebie, you can head over to resilient retail club com slash sales and get my calm

and consistent

sales starter. See you next week.