How do you solve the problem of the Second Sale Void?
Wouldn’t it be great if you could turn a tap and let money flow into your business? Would you believe us if we said that such a tap exists? Believe it or not, there’s an often-overlooked revenue powerhouse lurking among your audience.
They’re called first-time customers.
Handle them well, and they’ll buy again. Ignore them, and they fall into the second sale void. Perhaps you’ll never see them again.
Trouble is, many marketers focus on gaining more leads. ‘Building their list’ becomes more important than nurturing it. This approach overlooks your revenue powerhouse and leaves you chasing strangers around Facebook.
So how do you find this magical powerhouse? All it requires is a mindset shift. Put less focus on acquisition and more emphasis on retention. Let’s explore how to do that while avoiding the two voids of email marketing.
Hang on—What’s the Problem with Acquisition?
Most e-commerce marketers follow an acquisition-focused strategy. Their time, effort, and money goes on analytics and optimising marketing funnels. They maximise their social media presence for reach and visibility.
It’s all about trying to bring in new people. ‘Get, get, get’ could be the motto, rather than ‘sell, sell, sell’.
But here’s what happens. The average open rate of a campaign to an audience is 17%. That means 83% of your audience haven’t opened it. There’s a good chance that people who don’t buy from you make up that 83%. Over time, the number of people who sign up and don’t buy will grow, making your list less effective. This helps explain the 17% open rate.
Why does this happen? Welcome to the first Void of Email Marketing: the Post-Welcome Message Void.
The Post-Welcome Message Void
Does this look familiar? A potential customer signs up to get your incentive. They get your welcome message, and your email marketing system dumps them into your regular newsletter cycle.
This welcome message is where you’ll see your best level of engagement. The recipient expects the welcome message because they’ve signed up for it. This email is timely, automated, relevant, and targeted: all the things a good e-commerce email should be. (Remember this point for later).
Most people send a single welcome message. If that’s you, that’s why your audience falls into the post-welcome message void. There’s nothing for them to do and nowhere to go from a single email. It isn’t enough to introduce yourself and start a relationship with the recipient.
They don’t buy, and their motivation to do so wanes.
And you lose their interest because they didn’t buy during the initial excitement of signing up.
Remove the apathy from your audience
To combat this growing apathy, send a welcome sequence. That means 3-4 emails, depending on how complicated your offering is, and what the decision-making process is.
Persuading someone to sign up for your project management software will take longer than persuading them to buy your stationery.
So it’s often the case that it’s the importance of the decision to the customer that dictate the number of messages in your sequence.
It takes less convincing to buy a skirt than it does a car.
The less resistance to the investment, the fewer emails needed to persuade them. Meanwhile, your audience continues to grow thanks to your acquisition efforts. Yet the relevance of that audience and their effectiveness diminishes as long as they don’t buy from you.
It’s a sad fact that most of your audience is going to end up being people who have never bought from you. They’ve fallen into the Post-Welcome Message Void.
What’s The Answer? Hint: Not What You Think
Many e-commerce marketers solve the problem by getting more leads. The goal is to get so many leads that converting a handful still means more revenue.
Trouble is, that means more time and effort spent reaching new customers. You need to keep persuading strangers to buy the first time.
Think of all that energy you spend in overcoming objections and clinching the sale. This means you end up with more people on your list who won’t buy. You’re making the problem worse, not better.
Ironically, the solution is right there on your list already.
It’s the people who sign up and buy from you.
You can generate more revenue by returning to those customers. You’ve already persuaded them and overcome their objections. It’s far easier to persuade them to buy a second time after they’ve given you money.
But this is where your customers can fall into the second void of email marketing: the Second Sale Void.
Welcome to the Second Sale Void
You have your order confirmation emails in place. Customers know when you’ve dispatched their item. You send a follow-up email asking for a product review. Then you dump them back into the newsletter cycle.
Why does the second sale void exist?
Gaining new leads costs so much time, effort and money. It forces you to fight against ecosystems you don’t control. Think of the cost-per-click mechanisms, search engine algorithms, or social media terms and conditions.
Why not put your focus on the area that you can control—your email marketing?
The moment they buy from you, you already know more about them than 80% of your audience.
By giving you money, they’re giving you market research information. They’ve shown you which of your products are appealing or solve a specific problem.
Even better, they gave you their consent to contact them. So they’ve also given you permission to use that purchasing information.
Remember, people fall off a cliff twice in your email marketing setup. Once after the welcome message, and again after the first sale.
If you’ve kept them on the cliff after the first void, it’s your job to keep them on the cliff when they reach that second sale void.
How? Give Customer Retention some attention.
Conversion through your website is important. You need new leads coming in to create new customers.
But according to the Adobe Digital Index 2020 report into consumer electronics, the average conversion rate from your website is only 3%. That’s after all the effort you made to get them onto your website. That’s super disappointing but it’s a fact of doing business.
So if you put all your focus on acquisition, you’re missing a huge potential stream of revenue—your existing customers.
Do the maths. The second sale void is costly
Let’s do some basic maths to illustrate the point.
Let’s say it costs you £20 per head to acquire a new customer thanks to your marketing outlay. If you have an average transaction value of £40, you’re slicing your profit in half. Every sale you make to a brand new customer is at 50% of its value thanks to the cost of your marketing efforts.
How about the cost of a second sale? You already spent £20 to gain them. Yet you may only need to spend 5% of that marketing cost to persuade them to buy again. That’s £1, to save you finding a calculator.
If that same customer spends £40 a second time, then you’ve spent £1 to make £40.
Apply that to a third, fourth, fifth sale, and so on. Your return on investment on that original £20 becomes exponential when you focus on returning customers.
Put simply, the cost of a second sale is much lower than the cost of acquiring a fresh lead. Cover your costs of acquisition by all means, but focus on customer retention and avoiding that second sale void results in better profitability in your business.
How to avoid the second sale void and convert that second sale?
Do you remember earlier when we said the welcome message gets such a high open rate because it’s relevant, timely, targeted, and expected? That’s the point we wanted you to remember because it can guide your strategy to skip the Second Sale Void.
The key to getting this right is automation. 20% of marketers use automation to send campaigns.
How can you set up your emails to those first-sale customers so they’re also relevant, timely, targeted, and expected? Is your product something that runs out? Send a reminder when it’s time to order more. Is it seasonal or tied to some other period? That’s another great excuse for an automated, timely email.
Look at what your customer bought. Which other products would they like or need? Do you sell other products that complement their first order? This helps you satisfy the targeted and relevant criteria. If they enjoy your recommendations, it’s also a great way to build trust with customers. This approach is what Netflix and Amazon rely on.
Many businesses offer discounts to brand new customers, but why not offer a discount that’s only available to existing customers? Consider a surprise, time-based discount for the second sale. Perhaps they get 10% off if they buy a second time within the next 60 days.
Or why not turn your customers into affiliates and give them a discount for sharing a product page on their social media accounts? PayHip offers this functionality to those running e-commerce stores on its platform. The potential customer shares what they’re about to buy and unlocks a 20% discount.
If you use Websand, your dashboard identifies who these potential second buyers are. Look at what they bought, how much they spent, and how much they engage with your other emails. Do they click on specific links in your newsletters? Use this data to craft a personalised offer that suits their customer profile.
Keep Customers Happy
Building relationships and customer retention needs to be your focus.
Keep asking yourself how you can nurture the fledgling relationship to turn the first sale into a second sale.
It might be helpful to think about how they nurture sales in B2B environments, they are experts at avoiding the second sale void.
When someone buys a B2B product, the usually end up dealing with some of the most helpful people on the planet, they are called account managers.
It’s their job to keep the customer happy. They do so by continuing to help them with the product or service they’ve bought. It builds trust and loyalty and keeps the customers coming back to buy from that company.
How can you do this too after the first sale in your business? Answer that question, dodge the second sale void and you’ll be flying.
Just remember, if you’re making people happy, they’ll tell people about you. That boosts your word-of-mouth recognition and your company reputation.
Ultimately, it improves the wellbeing of your business.
Get your free 14-day trial of the Websand platform today to unlock the full potential of this customer data, avoid that second sale void and start nurturing lasting relationships that keep your customers coming back.
It’s time to start getting more from your email marketing
Sign up for a free Websand demo and let’s show you how to get the best from your email marketing.