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Customer Value Optimization [Part Two]

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In our last article we discussed how your business needs an exactly defined formula for getting customers, selling products/service, and factoring in the promo cost, and showing the profit.

We already discussed customer acquisition and saw that for selling online, PPC is the way to go.

So you’ve crafted a brilliant ad, and it is getting clicks, and people are going to a sales page (a specially crafted landing page, NOT your home page), and they are buying your product and you are making sales. But you’re not making the amount of sales you want.

It is important to set expectations realistically. When someone clicks on your PPC ad and goes to your landing page and buys your core offer ($50 product or such), that $50 should basically recoup the costs of all of the other people who clicked the ad, visited your page and didn’t buy. In other words, here is an example:

  • It costs $2 per click for your ads
  • Every 100 clicks you make four $50 sales
  • You pay $200 for the clicks, and then you make $200 in sales

Don’t be dismayed by these numbers. This is actually pretty good. If you can tweak your ads and your landing page to the point where your sales from the landing page recoup the promo cost then you are WINNING. Because everything after this point is pure gravy.

What this means is, if after this point, you add on ‘down-sells’ and ‘up-sells’, and ‘cross-sells’, you are then going to start making the profit you want.

The goal of any internet marketing campaign should be for the cost of customer acquisition to be recouped by the sale of the core offer. Profit occurs when you add on the down-sells, up-sells and cross-sells.


Increasing the revenue

In light of what we just looked at, if you want to increase sales and revenue then you simply need to:

  • Get more traffic to your sales page (landing page). You can use PPC, Social Media, direct message, etc.
  • Get more people who arrive on your landing page to purchase your core offer. In this case you are tweaking the conversion rate, of those who arrive on the page and those who pay. You want to increase that conversion rate so more people are buying when they arrive on your landing page. This could be as simple as changing colors, text, adding testimonials, etc.
  • Continue to tweak the quality of your PPC ads and your landing page until those sales alone are recouping the PPC cost. (tweaking the conversion rate).
  • Add in up-sells, down-sells and cross-sells to maximize your profit.


Even More Profit

The adventure of optimizing the life-time value of each customer does not end with the above! Once all of the above four points are complete and working there is still one more thing you can do to get even more profit out of each customer: email marketing.

The sales don’t have to end once the customer buys the core offer, and an upsell. He can be sold and sold again, ad infinitum. Since he is a buyer, he should go into a ‘buyer’ database, where you can send out specifically crafted sales emails, which will take them to an appropriate landing page where they can yet again become a buyer. This is really where the money comes in, because every sale is pure gravy, since the cost of the promotion was recouped long ago.

Therefore, it behooves the business manager to maintain a database of buyers and continue to sell to them after they have bought. Because they have bought before they are much more likely to buy again.



To reiterate everything we have discussed, the way you can increase revenue with your online sales/marketing campaign is by:

  • Increasing the amount of traffic to your sales page
  • Improving your sales page so more people buy
  • Tweak the quality of your PPC ads and landing page until those sales alone are recouping the PPC cost
  • Offering up-sells, down-sells, cross-sells

Having a database of buyers and selling to them via email marketing

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