A Powerful System To Generate New Customers At ZERO Cost and Make Money Too
(Amazon Opportunities, Part 2)
Savvy marketers will immediately recognizing the profit opportunity of the following system:
We talked about Amazon in the last TIP (Amazon Opportunities, Part 1) and how easy for us to make money on their site (http://www.amazon.com) selling used and out-of-print (OP) books (see my Bookseller Manual for more info on OP books).
As you probably know, most of the TIP's presented I've personally tested to see if they really work before sharing them with you. Here's an angle on selling books on Amazon that will help you build a solid and long-term profitable business. Amazon probably wouldn't be very happy about this idea...so let's keep it just in the family.
Let's say you're interested in selling books. You love to sell books. OK?
If you have been in business before you know how expensive it is to acquire a single new customer. Depending on the kind of business you're in, it could be anywhere from $1.00 to over $350 or more.. for a NEW SINGLE customer.
When you rent mailing lists or do any advertising, all that expense (or, depending how you look at it- investment) should have one goal and one goal only-- getting and keeping a new customer. Because the real profits of any business are REPEAT SALES, not one-time sales.
In our example we want to sell books. And we want to sell them 100% on the Internet or by mail order to existing customers.
How do we proceed to acquire customers?
If you're like most small businesses just starting out, you buy a mailing list and send out flyers or postcards or letters or put up a web site, and try to draw traffic to your site. If you get enough traffic, hopefully, you'll get a few customers too.
Worse than spending money, you'll be waiting an awfully long time to generate new customers (customers are defined as someone who has actually PURCHASED something from you). The average hit to purchase ratio on the web is about 500 to 1. In other words you need 500 unique visitors to your web site before 1 person will buy.
If you have a web site that is lucky enough to generate 500 unique hits a week, you'll get one new customer a week. Now you could do a lot better than that. Maybe you have a great site- or something unique about the way you sell books- you could significantly improve those odds...but you'll still have an incredibly tough time competing with all the other web sites selling books out there. Try generating 100 new customers a month- you'll need 50,000 unique hits. Not impossible, but there's a better way.
"Well, Dave what do I do?"
I'm glad you asked!
Remember that Amazon let's you sell books on their site? Good.
Do they have to be used books?
Yes, but...
Here's what I've been doing recently with good results. Not only am I generating a ton of new customers at ZERO cost, I even make a few bucks.
I read Steve Krug's book, Don't Make Me Think: A Common Sense Approach To Web Usability. I liked it a lot. After I read it through a couple of times, I decided to sell it as a "used" book on Amazon.
Within 1 hour of it getting listed, it sold. Hmmmm...
Before sending the book out to the customer, I jotted down the publisher (New Riders) and their telephone number (800-428-5331) from inside the book cover. I called the publisher, told them I was book seller and wanted to order several books at the regular discount. (I also had to fax my resale tax ID number to their offices)
They sent me a stack of books at a discount of 48% off the cover price or a net cost to me of $19.11 each (with freight charges added to the per book cost).
Amazon only allows you to sell books at 20% below their price. But even so, if I listed this book again I could still sell it for $22.40. So I would make a few bucks (3.29) on every copy I sold, BUT MORE IMPORTANT - I have a NEW CUSTOMER with an acquisition cost of ZERO with a $3.29 contribution to profits!
Believe me, this is good...this is very good.
Now, here's the next step:
You develop a line of books in the same subject/genre/topic area as the book you sold to this Amazon customer. You have their name and address and an idea of what they're interested in based on what they bought. Then you simply contact them again, with more books of the same.
If you are in the information business...it gets even better.
Let's say you have written a course or have a newsletter on "Creating and Marketing Killer Web Sites".
The profits are high (because it's your own product) - you can fill orders on demand and you are the exclusive source for your products.
The customer who buys a book on creating and marketing web sites would be a prime prospect for your course or newsletter- don't you think?
If you took the traditional route of renting a list (@ $90/M, min 5,000 names), sending a letter out to a few thousand names and waiting for a response of 2% (which is high for cold lists) you could spend a lot of time finding 'qualified' potential buyers.
With the method I just gave you above- you could easily generate 'qualified' buyer lists of your own at ZERO cost and your closing ratio (could be 10%-20% or higher) would be extremely high with the right offer and a killer sales letter.
TO SUM UP:
Let's go through the steps again, just to make sure we're on the same page:1. Cost of acquiring new customers is very high for all businesses;
2. Amazon allows you to sell your books on their site;
3. Books do not have to be old...they can be new...
4. You sell a book on Amazon that is related to your business interests;
5. If done correctly you can acquire a potential new customer at ZERO cost with a large probability you can even contribute something to profits;
6. You follow up with the customer offering them more stuff related to what they just bought from you...;
7. You will have an extremely high closing ratio because they are prime, qualified candidates for your offers.
8. Repeat steps 4 to 7.Go do it...it's an incredible 'open door' that may not be open for long.
Best wishes,
- Dave
Entire Contents © Copyright 2001 by David Vallieres. All rights reserved.