As a retailer, which is the most important sale of all? Is it the first sale, second sale, third sale or future sales?
Actually the answer is: “All of the above.” But you knew that already didn't you. What you probably didn't know, is the importance of the third conversion.
So what's the third conversion?
The third conversion is the third time a customer buys a product or service from you. This third conversion is critical, because it's now setting up something called ‘consumption.' You see a customer isn't likely to come back to buy more product, unless they have consumed the product in the first place.
So if you went to a cafe, and didn't drink the coffee the first time around, there's no way you'd go back a second and third time. But on the other hand if you do go to the cafe and drink the coffee once, twice and three times, it technically means you're hooked. It means you like the place (if not the coffee), or you like the service or that you like something which is why you've come back time and time again.
And no one needs to tell you that a repeat customer is mostly a really awesome customer to have. They don't make too much of a fuss. They waste less time asking questions. And the biggest reason they're back is because they like your products and services.
There's just one problem though…
All your marketing is designed for the first conversion. So if you look at your advertising or marketing, you'll quickly find that it's loaded in favour of the first sale. After that first sale you have little or no way of getting the customer to come back. And if the customer doesn't come back…well we don't have to spell that out for you, do we?
The goal isn't so much a factor of customer retention, but more a factor of understanding the concept of the third conversion. The concept of how you're going to get the customer to come back for the third time. And this concept of the third conversion is critical because the customer isn't just buying your products/services (which is just great) but is also forming a bond, a relationship with you.
So how do you go about creating this third conversion?
It depends on your business of course. If you're in a training sort of business then this is the easiest of all. Let's say you've got a yoga or pilates class, then nooooo problem
because you can simply sell the customer a series of classes and they come back. In fact you're probably already doing that.
The problem arises when you've got a product or a service to sell. Let's say you're selling jewellery, or curtains, or coffee. Now you've got to think through a bit of a process that will get the customer back at pre-determined intervals. You can't try to upsell them just $8000 worth of diamonds or some fresh new curtains. No you can't. But that doesn't mean you can't get them back in the store. The coffee store can get away with simply selling a prepaid coffee card (yes, prepaid). For the rest of us, we have to create something of an event.
An event designed to get people back
People who are interested in curtains will come back for some event that involves home furnishing. People who are interested in jewellery will come to an event that involves jewellery. If you create information or entertainment or info-tainment events, you can always draw even the most reluctant customers back.
Ah but how do you draw them back? You have no list do you?
If you do have a customer list then hey, you're off the mark. If you don't then you need to work on the list right away. It doesn't have to be some fancy thing. It just needs to be done. So get it done. And then create an event, or a sale specially for those customers. Or just give away free yummy cookies and coffee to customers in the area on a specific day.
The key is to get them back in the store.
And to get them back at a regular interval
No use in having them in your store after five years is it? You want them to come back twice or thrice in the next three-six months at the very least.
Ooh this sounds like lot of work
Yes it does sound like a lot of work. But it's more work trying to deal with new customers all the time. New customers take up enormous time, money while existing customers are mostly easy to deal with—and they keep coming back to buy.
So when we think of the question: Which is the most important sale of all? here is the answer.
The first sale is critical because it draws the customer into the store.
The second one is also critical because hey, the customer returns.
The third one is the most important of all because now the customer has returned thrice to buy.
This third conversion could not exist without the first and second. So they're all important. It's now up to you. Can you design a sequence for the customer to follow?
Can you indeed get them to the third conversion?
Next Step: “There are marketing books and there are marketing books – I bet there are not many you have read many times over?
The Brain Audit really teaches you the art of persuasion because it gives an insight into how people's brains work. I have used the principles in writing WebPages, writing articles, making presentations, networking, negotiating and even writing submissions for a judge!
But the best bit about the Brain Audit is that it actually works. The principles are easy to understand.
Would I recommend it to people serious about getting on in business? Absolutely.”
Michael Smyth, approachablelawyer, Auckland
Judge for yourself The Brain Audit: Why Customers Buy And Why They Don't
Tim Andren says
A lot of great information in this article. The event is a great marketing idea for the return customer. This underlines the fact that buying is emotional and the relationship is key to continued sales, referrals, etc.