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Mar 11th, 2009 Comments: 0

10 Ways To Earn Back-End Profits

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As I’m sure a lot of people realise by now, almost every industry has ways to elicit extra money from customers. It be as simple as “Do You Want Fries With That?” or “Would You Like To Supersize That?” or be far, far more complicated.

The lifetime value of a customer goes beyond the initial contact.

It’s become so commonplace that people know what is happening, but the deals are so good they’ll go along with it – anyway. The initial sale may even be at a loss, or more dramatically for free, if the potential for back end sales is high enough.

How does it translate to Internet Marketing, in general?

1. Upsells

These are simple extra offers that are proffered directly after the main sell. Usually they are complimentary products to the main main offer, provided at a discount.

Sometimes these are promoted as being “one time” only, with the emphasis that you’ll never get that extra bonus again unless you purchase the main product again.

Sometimes you’ll even get a cycle of upsell offers, but this can quickly prove distracting and give a negative impression to your customer.

2. Upgrades

This is similar to an upsell in that it’s an extra sale on top of the main, but it’s usually tied to the main product. It may be as simple as extra additions to your main package, perhaps bonus templates, books, audios, videos, DVDs, or whatever. It could also be extra rights, such as Master Resale Rights or Private Label Rights to the first product.

If it’s a membership it could be an upgrade to a higher level (e.g. Gold), or if it’s a service it could be an upgrade to 2 years support instead of 1. If it’s a virtual product, the upgrade could be to a physical copy. There are a lot of opportunities with this kind of upsell.

3. Recurring Income

Back End profits don’t just mean extra sales after the main, it could be a recurring income provided month by month.

This works well for subscription based sales, perhaps for a premium newsletter or content site, or more commonly a membership site.

It’s common practice to to combine the subscription model with a loss-leader front-end. For example, the first month for free or for $1. Just be up front about the recurring part, so you don’t break any laws and you are not inundated with angry customers.

4. E-mail List

One way to ensure you can make your money per customer beyond your initial sale is to capture their e-mail address. This gives you a way to keep in contact.

The easiest way to do this is to ensure the customer has to register the main product, either at the first entry onto the site, or by registering the product after it is purchased.

With an e-mail list of customers you can provide further offers in the months or years ahead. The customer has already proven to be a buyer, so this kind of list is very valuable. Just don’t overdo it!

5. Preferential Discounts

While it’s bad form to charge existing customers for minor upgrades to your main offer, it’s acceptable to do so for major revisions, such as new versions.

And if they’re already a purchaser, a discount is way to entice them to buy – it’s fairer, and it’s easy money for you.

6. Support

One way to increase after-sale profits is to provide a premium support service. While you shouldn’t charge for basic support, extra services such as installation, personal help, coaching, or one-on-one consultations can certainly carry a premium.

7. “Subtle” Promotion

Another idea to promote your brand, site and/or products to your existing customers is to subtly include them with the main product. If you create your own products, you already do this with links, (C)’s and ads included within the product. You can also do it if your product comes in PLR form, allowing you to edit it, or if it is re-brandable. You can even include a a text or html file in the package – let’s call it “readme.txt” or “bonuses.html” – to entice your customer back.

This can also be considered viral marketing, since if your customer resells or gives away the main product themselves – providing you’ve allowed the neccessary rights – all this information will travel with it.

8. Make a Sticky Site

Another way to get your customer back, and therefore allow for further sales, is to include sticky aspects to your site. This can be as simple as a forum, or a members area, or a blog. By stating further bonuses, articles, or help will be forthcoming or is already available your customer has a reason to return. This works well along with a mailing list.

If you have confidence in your products you could also allow product reviews, ratings, and advice to be posted, and even credit your customers with points per purchase / post / vote to be redeemed.

9. Appeal to Greed

If you know you can make a substantial amount from your customers even after the initial sale, you can afford to pay them, or others, to promote your products for you. This is essentially affiliate marketing, but with the twist that you could even afford to pay affiliates more than the actual initial sale would make – such as for a free product. You have to crunch the numbers to do this, and know your conversion rates in advance.

10. Try another Medium

Finally, one way to catch your existing customers attention is to move to another medium. If you are selling virtual products, perhaps information products downloaded from your site, consider contacting existing customers periodically via mail or even telephone. If you sell physical products, keep in contact with e-mail or a special website / blog.

Keep your customers happy, give them what they want, and ensure you offer value in some way (special pricing, extra support, bonuses) and you’ll soon discover that marketing goes beyond that initial sale.

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