Business owners often fail to understand that until and unless ideas get them enough revenue to pay their bills, even the best of ideas are rendered useless.
There are three primary methods for revenue generation:
(1) Prospect generation
(2) Online sales transactions, and
(3) Advertising and referral income.
What are prospects? They are potential clients/customers whose interest in your products might result in sales for you. The usage of the Prospect Generation model is amplified if you make use of the internet share more information about your products with prospects. Once you’re done with convincing prospects about your products, the next step becomes closing your deal. You can do it in any manner that is most suitable to your prospect – telephone, e-mail, or a face-to-face business transaction.
Let’s take the example of my own business – the internet was of great help to me as it helped in attracting clients for my online store design business. What they needed was information, and I gave them whatever they wanted to know from me. That automatically resulted in more prospects visiting my website for even more enquiries about my products, because everybody wants to know the detail of the item that they’re going to buy from any seller. If I got lucky, some of those enquiries would results in sales.
A properly designed online response form acts as a catalyst for getting more and more prospects. E-mail links on your site give people the convenience of contacting you, but keep in mind that if they fill in online forms, they give you catalogued information so that you may categorise prospects on various basis for your own convenience.
A couple of years ago, a police products cataloguer did business via a website so that he could get more requests for a print catalogue. To his surprise, he found out that he actually got more requests for catalogues through his website from international prospects, as opposed to the business he generated via conventional sources, and that too at much, much lower costs. He very smartly asked his leads the name of the organization they represented or were members of. In this manner, he cut down on a huge number of catalogue requests from people who would more likely than not convert into sales.
If your business has clients that need proper human contact for knowledge about their purchase, or they simple take their own sweet time to come to a decision, then prospect generation is your best bet. This is especially true of products that have a higher price tag or need customization.
But, you can always boost your sales by providing information on your goods or services via your website. An argument then pops up – if we tell customers everything that there is to know, they
wouldn’t bother contacting us, in which case we might not be able to complete the sale. That might be true. However, you have to understand that today’s consumer is highly smart and will never spend their hard earned money on something that they know not much of. If they find the information on your good or service dubious, incomplete or unsatisfactory, they’ll move to your competitors’ website, and get whatever information they want. In that case, it’s a definite loss for YOU.
In today’s world, competition for your business is only going to increase, and for prospects, access to your competitors is going to be just a click away. For this very reason, the manner in which you present all your information should be compelling enough for making your prospect not want to go to any other business party.
Being in any business means you have something to SELL, and when you have to sell, you need to have a way to process your transactions. The Sales Transaction model is all about completing the actual sales transaction over the Internet.
Let us begin with the advantages that business owners have while processing transactions over the internet. The internet has made many things possible now – is has the ability of extending your company’s reach beyond your physical market area i.e., you might be sitting in California, but you could make business deal with another dealer across the ocean, in Japan. And you don’t even have to do much. Run a website for your company, give the details of your products and your company, a phone number or email address to get back to you, and then the whole world becomes your playground! The transactions are user friendly too – new products can be added with the simple click of a button.
Business to consumer is not the only growing area in the online retail market; business-to-business e-commerce is growing by leaps and bounds. For any online business company, it is mandatory for it to complete its sales transactions and product delivery over the internet. Analysts were not wrong in believing that in the near future, almost all software transactions would be taking place via the Internet. With your competitors have the same price ranges as your product or services, it’s finally what you have over and above them that’ll set you apart – how efficient you are in delivering your product and helping customers out with whatever troubles they might face after their purchase. Product fulfilment is of great importance for any business owner.
Advertising and Referral Revenue
The third revenue generation model is about your referral income and how you advertise.
Everybody wants to just sit back in their chairs, comfortably in their offices, and get lots of revenue from advertising without having to do much. But as they say – no pain, no gain.
Each and every day sees thousands of website springing up. The number of websites is increasing by leaps and bounds, but there’s not enough demand for online advertising that can keep up with the creation of so many websites. Due to this, many websites do not get any paid advertising. And there is no reason for advertisers to put their money into a sinking boat, is there? If a website is not getting enough traffic, no advertiser will be attracted to it.
In order to get good traffic, your website needs to be nothing less than outstanding – something that’s all in one, something that contains information, news, has an online forum for members to interact with each other, etc.
You might have it all – a star product, good delivery status and even an extremely appealing website, but you still might not be getting much business. You can make money off the traffic that visits your site, along with making prospects buy your products, all by following the Affiliate Program. Providing incentives is one smart way of going about it – you hire affiliates to bring traffic to your page, and in return, you pay them a few that is in direct proportion to the traffic they bring to you. This program is a viable option for smaller site owners because it helps them earn more money, quickly.
The primary objective might be to obtain a particular sales level, but for most new business owners, raising awareness is of prime importance. There are many ways in which you can garner your payout:
- Pay-Per-Sale – Affiliates are given a certain percentage of the profits of the sales they make. Larger companies generally opt for this option.
- Pay-Per-Click – You pay money to your affiliate every time someone gets to your site via any ad.
- Pay-Per-Lead – Prospects click on an access point from the affiliate’s site. They fill a form, and it’s send to you. You pay money according to the number of forms forwarded your way.