If you’ve wanted to learn how to get more enquiries for a service based business, this video is for you. After doing marketing for service based businesses for over 10 years through my marketing agency, I’ve found that it’s often doing the simple things right that will grow revenue in a business.
It’s not necessarily easy, but with the right strategy and some commitment you can predictably grow your service based business. While it’s a big topic, I’ll share a few starting tips to grow your business and generate more leads.
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Hello there, Ray Corcoran here. In this week’s video, we’re going to be talking about a number of tips to help you grow your revenue and profit in a service-based business. These tips are going to be from my own experience over the last 12 plus years, doing marketing consulting and running a marketing agency. For me personally, I’m a really big believer in boosting your active income. While investing is really, really important and you should do it. A lot of people don’t focus enough on just simply building your active income that will transform your life a lot quicker and sooner when combined with investing. And while doubling the revenue of a business might not be as simple as clicking your fingers and it all happens. It is very, very possible and I’m going to show you some of the maths and the specific tasks that you can do to increase the revenue within a business.
And if you’re interested in learning more about how to make more money, save more money and invest your money, please consider subscribing blah, blah, blah. Just like the video and stuff because it’s important to my self esteem. So the first tip is understanding the maths of growing your business. So this is not going to be crazy maths, don’t worry, but basically it’s very, very simple maths in terms of growing a business. And it is a lot of work, but it’s very, very simple. The first thing we need to understand is the number of leads or inquiries that we’re currently getting. The second thing is the conversion rate of those leads. So if we get a hundred inquiries a month and we convert 20%, we’re going to get 20 customers. The third metric is AOV, which is average order value. So this is the average amount that someone would typically spend with us.
And you may have different AOVs for different types of customers, but just average it out to keep this exercise simple. The fourth metric is purchases per year or per period. So you might have someone who spends 200 bucks with you three times a year. So their yearly spend is obviously 600 bucks. And then the final metric is your profit margin. So what percentage do you make after costs? And basically for the purpose of this exercise, we’re going to be looking at what happens if you increase some of these metrics and what impact does that have on the overall revenue of a business? Generally there’s lots of different ways to approach it, but generally you’ll start with improving your margin first, then your conversion rate, then your average order value, then your purchases per year, and then increasing your lead generation.
And of course you can work on multiple at the same time, but generally some of these things, improving your margin, reducing your costs, improving your conversion rate. Those things I mentioned at the start, they usually are much easier to do without much cost or effort, whereas generating new leads on the other end, it can be easy to do, but it often involves a bit more time and money invested to make that happen. So if you have a certain baseline number of metrics, if you increase each of those by only 10%, which is not that much, you start to get leverage and you start to get a much bigger impact at the end, in terms of the uplift in your revenue and profit. And it gets even bigger, if you increase each of those five metrics by 20%, you start to get some pretty staggering numbers.
You can double the business, if you increase each of those metrics by only twenty percent, which is not easy, but it’s also not hard. And we’ll have some examples up on the screen now. So you can sort of start to see just a few examples about how much you can increase your business by only increasing a few different leverage points by a small amount. So we’ve looked at the metrics now and some of the basic numbers that we need to improve to grow your business. The second thing we’re going to look at each of those metrics, one by one now and provide some examples of things you could do. So if you, for example, want to increase your lead gen or you want to increase your profit margin or whatever it is. Well, there’s going to be a number of different tasks under each of those metrics that you can do to start moving the numbers.
The second point we’re going to go over, is getting more leads. So one of the things you can do to get more leads is simply just doubling your marketing activity. So this is a crude one, but it does work. You might not double your activity and then get twice as many customers, but you might double your activity and get 80% more customers instead of a hundred percent. It could be sending out twice as many emails to your database. It could be doing twice as many phone call follow-ups, SMS followups, social posts, any of those things. If you’re doing two a week, try to do four a week. The second is testing new marketing channels. So if you’ve always got your customers through word of mouth, which a lot of businesses do, have you ever considered doing Google ads, maybe SEO, maybe setting up partnerships, trying different channels because ideally in a business we want multiple different channels for our customers to come in from.
The next one to get more leads is simply if you’re advertising, just increase your ad spend. Now this needs to be done carefully. You can’t just double it maybe overnight, but you can maybe 20% a day or every few days start to inch up the amount of spend. The next tip for getting more leads is getting more reviews. It’s a really, really simple one. Anybody can do it. Not many people do do it, but getting lots of reviews for your business is one of the best free marketing strategies that you can do to get more leads coming in the door. Another way to grow more leads is improve your website’s SEO. Now that’s a massive topic and would take video upon video to explain that in detail, but some of the examples of things you can do in terms of improving your website’s SEO, improving your website speed, you can create keyword focused pages. So if you know people are searching electrician, Melbourne, for example, you can create dedicated pages based on that.
So you can rank for some of those relevant terms. Another tip is to build relationships with people who can refer you work. One strategy that is super, super common is just building strategic partnerships with people that service the same type of customer as you, but you’re not a competitor. So there are a few tips to start off with in regards to lead generation. I could talk for days about this sort of stuff, but there’s so few things to sort of get your mind thinking. Tip number three, is increasing the number of transactions that they do be that per year or per period. Some businesses people come in every week and you want them to come in everyday or whatever, other businesses they don’t buy everything by once every three years. So you want it, whatever it is you want to compress how frequently they buy.
And if you’re in a business, maybe it could be about real estate that people may not buy every single year. Your goal from there would be to find referrals and get people do such a good job that they refer to other people that are buying sooner. So to get people to buy more, a lot of it comes down to follow up. So it could be phone follow-up, SMS follow up, ad retargeting follow-up, whether it’s on Facebook or Instagram or whatever it is, can you offer a discount or an incentive to buy more sooner and bring that date forward for the next purchase? In some situations, can we put them on some sort of subscription model? So they’re automatically buying on a regular basis. Can we invite customers to come back and buy again? Is there a different product or a similar product or more of the same product?
Actually invite them to buy stuff. You don’t have to wait for them to come to you. You can go out to them and talk to them about different products that could improve their life or fix their problems. Tip number four is improving your conversion rate. So for every inquiry that you come in, if we can convert a higher percentage of them into customers you’re going to make more money. Some of the things that you can do to improve this metric is adding more guarantees to your offering. Satisfaction guarantee or money back guarantee after 30 days or whatever, you could improve your sales skills. So you could do sales training to get better at having that sales conversation with people. So you are better at learning about their problems, addressing objections and all that sort of stuff.
Can you get more reviews or testimonials to build up a bit more trust so that a high percentage of people will say yes, because they’re not worried that it wouldn’t be a good product or it won’t deliver what they think. Can you mention awards or industry certifications just to keep building up that trust? Can you accept multiple different payment methods or do payment plans? On the finance side of things, can there be different ways that people can pay? So it’s easier for them to say yes, can they pay part now? And part later? Doing stuff like that can increase your conversion rate because it’s a bit more flexible. Could you communicate your value clearer? So could you be better at summarising why they should go with you, why they should use this particular type of solution, that sort of stuff. Can you differentiate your product more?
Can you do things that others can’t do or won’t do? Number five is we’re trying to increase the average transaction size. So there’s a few things that you can do here. So we want to make people spend more, obviously ethically, more per transaction. Some of the things that you can do to increase that average order value are increasing your prices, raising the minimum quantities that they can buy. You can do upsells. So if they’re buying this at point of sale, you can offer them product B that goes with that. You can offer discounts or bonuses or incentives to buy in bulk or to buy more than they probably would need for now. If you have a sales staff can we give them incentives if they sell more? So if they sell beyond a certain X, do they get an extra bonus on top of that?
Number six is all about improving your margin. So there’s a few different things you can do here. I’ve already mentioned creating a process, but increase your processes is a great way to improve your margins. Obviously, any increasing price is going to be a straight increase in profit, which, you know, love that. The next thing to look at obviously is going to be reducing your costs. So can you negotiate with some of your suppliers? Can you buy any raw stuff that you need to buy? Can you buy it in bulk to get a discount? Can you go through all your company costs line by line and have a look at anything that you can either cut out or renegotiate? A big one in terms of improving your margins is just to stop discounting. There’s a lot of people who just give out good guy discounts out of nowhere, just don’t discount.
A lot of people that do discounts, if you have a product that is not a commodity as in it’s unique and they can’t get the exact same thing from somebody else, just avoid discounting. A lot of people ask for discounts. They’re entitled to ask for discounts. And you’re entitled to say no to a discount. Don’t be living in fear. If the product’s worth the price, tell them that’s the price and remind them what the value of what you’re delivering is and how it’s going to be better. And how going with the cheaper provider is basically going to be crap. And another simple tip is just don’t offer low margin products. There’s so many people that have a product range where there’s certain products that don’t make much money and they never made much money and they never will make much money.
And unless it’s deliberately low margin, but it helps open the doorway to other higher margin products, then maybe that’s okay. But if you just simply don’t offer low margin product, it’s going to be a lot easier. For me and my business, for many of my clients, if we look at all the effort that it takes to deliver all these products and services, sometimes we just trim their product line down a little bit. So it’s only higher margin stuff. And naturally the business is simplified, it’s less complex and the margins are much better. So I hope you found that useful. At the end of the day, growing your business is very, very formulaic and it’s simple maths. It’s not easy to do all the work, but it is very, very simple. And if you can help increase each of those metrics just by a little bit and make yourself a little bit of a mini action plan, you will be able to grow revenue.
That’s all for this week. If you enjoyed the video, please give a like, and other than that, I’ll see you in the next video. Cheers.