Download - What Are The Benefits Of Fixing TheLeaks

Copyright @ 2010, Ronald D. Ryan 1

Section II

“You've got to be very careful if you don't know where you are going, because you might not get there.”

- Yogi Berra

Typical Customer Flow

You Need To Model This

Online Sales

Process

Sales Center

In-StoreFulfillment

& Service

Repeat Purchase


Internet

Off Line

Advertising

WhatAre the Benefits?

Key Concept #1

Know Who Is Leaving And Why: Knowing the

number of customers who visit your store(s) or site(s),

convert to sales, and make repeat purchases is

important. Understanding how many you lose at each

step in the process and why, critical.

Copyright @ 2010, Ronald D. Ryan

3


Improving These Metrics = Easy

Money…

Sales Center or

Retail Store

1 in 4 or 5 buy

Fulfillment & Service

8 or 9 out of 10 Keep What You

Sold Them Repeat Purchase (Or Renewal)

Between 5 and 9 Out of 10


Conversion and repeat purchase

rates shown are for discussion

purposes only. Rates in your

business will vary by product,

process, customer type, time period,

and season.


Key Concept #2

Complete The Circle: Improvements in

conversion and repeat purchases have a

huge impact on profitability.Copyright @ 2010, Ronald D. Ryan

5

WhatAre the

Benefits?


Repeat Purchase Cycle

Online Process

Sales Center

Or Store

Fulfillment

& Service

Repeat Purchase


Most People Call,

Drive or Log on to

Make A Repeat

Purchase. But Not

Always From You.


Examples of businesses

improved by subscription

model:Business Example Vertical (Likely) Victim

Netflix Movie Rental Blockbuster Video

Diapers.com Baby Products Local Retail Grocery

Store

Dollarshaveclub.com Men’s Grooming &

Toiletries

Local Retail Drug And

Grocery Store

Lensdiscounters.com Vision Care Local Retail Vision

Care

Petflow.com,

mydogbowl.com

Pet Food Local Retail Pet Food

Surfair.com Repeat Airline Travel Commuter Flights

between large cities


Most Profitable Repeat Purchase Cycle

Online Sales

Process

Fulfillment & Service

Repeat Purchase


For most companies, online or

automatic repeat sales are the most

profitable sales of all.


Key Concept #3

Angry no more: Moving repeat sales

online lowers acquisition costs, increases

customer satisfaction, and improves

profits.


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WhatAre the

Benefits?


Story Problem:

A. If each visitor to your site costs you $5.00 to attract, and for each 20 visitors you sell one product, what is your acquisition cost per customer?

B. For extra credit: You improve your web site. What is your acquisition cost per customer going to be if you sell 1 customer for 10 visitors?

C. Double extra credit: What if you buy 25K leads per month and the cost of improving your web site above in B is $100K. How long will it take you to make your $100K back?



Story Problem:A. If each visitor to your site costs you $5.00 to attract, and for each 20 visitors you sell one product, what is your acquisition cost per customer? Answer: $100.00

B. For extra credit: You improve your web site. What is your acquisition cost per customer going to be, if you sell 1 customer for 10 visitors? Answer: $50.00

C. Double extra credit: What if you buy 25K leads per month and the cost of improving your web site above in B is 100K. How long will it take you to make your $100K back? Answer: 1.6 months.



Key Concept #4

Easy Harvest: The ROI from changes that

improve conversion and repeat purchases is

often very high. The time to payback is very

short.


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Why Study The ‘Leaks’ -

Deeper Understanding of Customers

Higher Customer Satisfaction

Higher ROI

Lower Acquisition Costs

Higher Profits

