Sunday, December 27, 2009

New Network Sales Model Changes the Online Sales Game

Traditionally, online sellers have fit into one of two models. Either they are a pure retailer, selling other companies’ products at a mark-up. Or they are a ‘factory outlet store’, selling their own products and services direct to consumers.

The second – the factor outlet stores – are leaving literally millions of dollars on the table.

Do the math. A merchant that has one product to sell, at $40 a pop and a goal of selling fifty thousand units next year has put an artificial cap of $2 million in revenue on their business. And once a buyer has put their trust in the merchant, there is nothing more to sell them – that business relationship is valueless.

To understand how much profit is being left on the table, first cast your mind back to the last time you reached the check-out at a grocery store. You’ll recall that the space around the check-out is densely packed with impulse-buy items: packs of gum, gift cards for iTunes, magazines and more. Each of these items represents a high-margin opportunity to add to your eventual bill. And that space is actually bought for the most part by the products’ manufacturers – because they know that once you have your wallet open, you’re highly likely to add another item to your basket.

Now imagine an online buyer purchasing your $40 software package. They would be more than happy to add an impulse-buy item, if you offered them one. Maybe a casual game at $9.95, a support package for $14.95, even a PC Accelerator for $20. If you could take a 30% to 40% revenue share on selling these items, your business’ revenue could increase by as much as 20% - without the need to invest in building new software.

And now imagine running a monthly newsletter to each of your buyers offering a ‘special deal’ on another partner’s product with another 40% revenue share on, let’s say, a $40 item. Assume you have a user base of fifty thousand, and a conversion ratio of just 1% - that would mean you could look forward to 500 sales per month, or six thousand per year at $16 revenue each. Combined with the promotions you offered in the purchase process, you’ve now increased your revenue potential by a full 25%.

The really good news is that you can do this right now, without any financial investment, by using the Plimus e-Business platform. With your own account in place to take care of the e-commerce for your own products, you can swiftly agree to re-sale deals with companies like Namco, Avanquest, Surf Secret and literally thousands more. And of course, you can seek partners who will re-sell your products on a revenue share basis, increasing your audience size.

Plimus merchants are seeing initial invoice sizes as much as 43% higher using Network Sales, increasing their revenues and helping them build a sustainable business for the future. For more information, visit Plimus at http://home.plimus.com/ecommerce/content/transform-your-business-network-sales.

Jason Kiwaluk

Mower & Shoveller,

Ideation | Ecommerce | Fintech | Innovation | Strategy | Opinionated Agitator RevenueWire,FuturePay+PayMotion

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