Today, most entrepreneurs who want to sell online use online e-commerce platforms such as Shopify. But increasing sales and making more money out of your online store could be a little tricky. You will need effective tools that help you increase the performance of your online store. In this article, I’ll go through the three steps you need to take to make more money from your Shopify website.
There are only 4 strategies you can increase your revenue. Following, I’ll discuss these four methods and in the conclusion, I’ll tell you how to start. So, let’s go through these strategies:
1. Grow the Number of Customers
Growing the number of customers is the first strategy that comes to any business owner’s mind to make more money from your Shopify website. It’s expected to be safe and straightforward but is not as easy as it seems.
Increasing the number of customers means you’re trying to bring more people in the door. This strategy is relatively straightforward: more visitors to your business will equal more sales, which (assuming the average transaction size stays the same), will bring in more money.
One of the most common ways to grow the number of customers is by converting and monetizing your website traffic. It’s done by widgets and forms that help you collect the contact info of your website viewers. You’ll then use this contact info to lead them into your sales funnel.
Growing the number of customers is a very straightforward way to increase revenue, but it won’t guarantee your revenue in long-term. In other words, nobody can guarantee the customers you’ve gained will stay with your business the next month or the month after.
When building your strategy, it’s essential to think long-term. Read the next strategies to learn more about more long-term strategies that will help you make more money from your Shopify website.
2. Increase the Average Transaction Size
Increasing average transaction size means you’re trying to get each customer in to purchase more.
This strategy is typically done through a process called upselling. When a customer purchases something, you offer them other products or services that encourage the customer to buy more. The more of these items the customer purchases, the more they spend, and the more revenue you collect.
To optimize your upselling and increase the average transaction size of your online shop, you can use customer analytics tools that help you understand your customers and offer the right products to the right customers at the right time.
Increasing the average transaction size is a very common strategy both for short-term and long-term plans. The most important element you should consider in this case is understanding which products to upsell. As mentioned above, this is achieved by analyzing your customers to understand them using customer analytics tools like Formaloo.
3. Increase the Frequency of Transactions Per Customer
Increasing the frequency of transactions per customer means encouraging people to purchase from you more often. If your average customer comes in once a month, convincing them to patronize your business once a week will increase your revenue. The more frequently they visit your establishment, the more revenue you will bring in, assuming the average transaction size stays the same.
According to the Gartner Group, 80 percent of your future profits will come from just 20 percent of your existing customers. Therefore it’s vital for any business to increase the frequency of transactions per customer. This is achieved by retaining customers and encouraging them to keep engaged using gamification marketing.
This is the most effective strategy your business can implement to guarantee both long-term and short-term revenue. You can boost your sales by mixing this step with the above strategy in step 2.
4. Raise Your Prices
The final strategy is to raise your prices. Raising prices means you’ll collect more revenue from every purchase a customer makes.
Assuming your volume, average transaction size, and frequency stay the same, raising your prices will bring in more revenue for the same amount of effort. But this strategy is not always the best strategy you could choose. It’s important to understand how much raise is right because the wrong pricing could even bring disappointment and decrease your revenue.
It’s clear that raising prices is not always a long-term strategy and your business needs much more to grow fast and sustainably.
Let’s Get Started!
To begin, start with analyzing and understanding your existing customers. Then, you can make data-backed strategic decisions. Customer Analytics tools such as Formaloo help you consolidate and analyze your customers. Formaloo also gives you impactful insights and actions you can take to retain your customers and grow your revenue.