4 Ways to Increase Profits
There are four ways to make more money from your website:
Let's work through the list backwards.
Decrease your costs
In some ways, this is the least important of the methods I listed. For one thing, it's the only one that won't increase your revenues -- nobody ever got rich just by minimizing costs.
It's also the only one that can really be overdone. Sure, it's possible to drive more traffic than your website is ready for or get more customers than you're prepared to support. Those can be be real problems, but for most people, they're a long way off yet.
But it's still important, particularly if you're still working out how you're going to make money.
You need to periodically consider where you may be spending more than you should, both in terms of money and time. Are you subscribed to services or membership sites you don't use, or don't get enough out of to justify their cost? Cancel them. Even if they're mine!
Do you buy too many eBooks that either don't teach you anything useful, or just distract you from implementing anything you've learned? I'm all for continuing to learn, but if being a serial learner is keeping you from becoming an earner, then stop!
Are you paying too much for web hosting? Maybe you have a high-bandwidth plan, but you're only using a fraction of its capacity. Unless you' have good reason to expect a lot more traffic soon, scale back your plan.
Are you paying for advertising that isn't paying for itself? Redirect your spending to the places that are the most profitable, or scale back.
There are a million little ways to cut costs. Just be careful not to go cost-cutting-crazy and cut out expenses that are driving more revenue than they cost.
Increase your revenue per paying customer
A few ways to do this include:
- Create more products that appeal to the same people, and offer them to your existing customers. These can be low ticket items that you offer to the public or high-ticket items that maybe hard to sell to general traffic, but easier to sell to existing customers, who already know the value of your products.
- Earn commissions on sales of related products sold by others. Write reviews of high-quality products and link to them with your affiliate link. Be careful not to lose credibility with your customers by recommending bad products, or you'll lose the chance to sell to them in the future.
- Sell products that you can rebill for, like monthly memberships, ongoing services, etc.
Convert more of your traffic to paying customers
To increase your conversion rates, first you need to learn techniques that increase conversions, and then you need to test the changes you make to your website to verify what works best for you.
A few things that can help increase conversions include:
- Capturing email addresses of visitors to your website on a mailing list, and following up with them. If you don't, they may visit your website once, and never return. If you capture their email addresses, you'll have multiple chances to reach them again, either with an offer that appeals to them better, or at a time when they're more ready to buy.
- Learning better copywriting to improve your sales letters.
- Adjusting your prices for the most profitable balance of volume and amount. Keep in mind that you may make multiple sales to the same customer. So if your typical customer makes enough future purchases, it may be best to focus on volume on the front end, even if it makes your lead product less profitable by itself.
Increase the amount of targeted traffic coming to your site
A lot of internet marketers leave one important word out of that sentence: "targeted". And it's not entirely their fault. They're doing it because the so-called traffic experts they learned from teach techniques that focus on volume more than quality. After all, it's a lot easier to drive volume than quality.
Some people focus on volume, figuring that somewhere in all that volume, they'll catch a few members of their target market. And it may work. But it causes problems:
- It wastes bandwidth and other resources.
- It makes it more difficult to connect with members of your target market, because either you're spending too much time on everyone else, or you're too distracted to ever even discover who your real target market is and what they want.
- It makes it harder to get valid split test results, because actions taken by people not in your target market may skew your results away from the actions taken by your target market. For example, if people who'll never buy your product are more likely to join your mailing list with headline A, but potential buyers respond better to headline B, you might drop the more profitable headline and end up with a great big mailing list full of non-buyers!
So how do you get more targeted traffic? Here are three important tips:
- Figure out who your target market is in as much detail as possible. Pay attention to details that you might think are irrelevant.
- Figure out where they're reachable online. One reason you want to know the "irrelevant" details is that they can help you find places to reach customers. For example, even if your product has nothing to do with politics, if your buyers are mostly conservative republicans, guess what -- you may be able to reach them through conservative republican websites.
- Figure out how you can reach them there. Once again, "irrelevant" details can be useful. For example, even if your product isn't a "womens product", if most of your customers happen to be women, you'll reach them better by tailoring your appeal to women.
Where to focus
You don't have to work on all four ways of increasing profits at once. You'll usually get more done if you focus on one thing at a time. But where should you focus?
The most obvious answer is to pick the area where you're weakest and try to fix it. Sometimes that's the best answer, particularly if you've never bothered to learn or implement anything in that area. You may be making glaring mistakes that are easy to fix.
On the other hand, it's often best to focus on your strengths. You don't want to neglect the areas where you can be extraordinary to focus on areas where you're unlikely to excel. Just don't focus exclusively on your strengths -- which is often tempting because it's usually the most fun -- and ignore festering problems in other areas that are dragging your business down.
Ultimately, it's a question of where you can make the biggest improvement. Remember that small improvements in each area multiply with each other to make for big changes.
Take time periodically to consider each of the areas, identify where you have the best opportunities to improve, and then take action.