What does it take for someone to buy your product or service?
• They need to be interested in your market.
• Know about your product or service.
• See value in your product or service.
• Be willing and able to purchase.
The 10-1 Rule
For every 100 customers that see your product or service, 10 will likely be interested and 1 will possibly buy.
This formula is a great way to start, amend it as you get more data about your conversion rates. These might be higher, but most likely lower if you have done your marketing correctly. This entire process will improve over time with trial and error.
Make an incredible offer
When you have reached the stage of making your offer, make sure that you make visible all the value that it brings the potential customer.
Benefits of your products are not necessarily the value. Think deeper, think about the problem and the emotions related to having the problem solved.
You may also want to increase the value of the offer by adding additional value, or a free “Bonus” as it is called. This could be:
1. An additional product or service.
2. A discount on a future purchase.
3. Anything of value that is relevant.
The Sales Funnel
All the work you have done this far has led you here. Now ask yourself the question, how many sales do I need?
In the 10-1 Formula you learnt that essentially for every 100 people that see your product or service, you could potentially get 1 customer. Again, this will vary for many reasons, including market type, demand etc.
Knowing the price of your product or service, subtract all monthly costs, including all running costs that could be included such as marketing, hosting, software, and ads.
If this number is negative, which most likely it would be, it shows that your business will not be viable on selling only one product.
Redo this calculation with 10, 100 and 1000+ sales.
Do you see a positive number that you like? Now you have a target.
Reverse this number as follows:
I need X sales, this will require 10X people interested and an audience of 100X.
You now have your success formula. Note that this will change with time and become more accurate with more data.
You can also consider:
• Acquisition Cost (Are you doing any paid marketing or ads? What is the cost to get a single customer onboarded?)
• Cart Value (What will the average order value be, consider adding up and down sell products to increase potential order value)
• Lifetime Value (What are the chances of a repeat order or can you offer a monthly subscription?)