Does Your Site Extend Its Welcome?

By Michel Fortin
Posted Saturday, August 28, 2004

On the web, targeted traffic is essential to an online business' survival. Al Ries, in his book "Focus: The Future of your Company Depends on it," wrote that our rapidly changing, technology-driven marketplace will mandate a sharper marketing aim -- particularly in the new millennium as increased competition will give more choice to the electronic consumer.

Niche marketing is indeed the wave of the future. In a society saturated with sameness and overcrowded with choice, the necessity of narrowing one's focus and differentiating one's business have become more evident. As the Internet grows, so too will the number of online businesses. Targeting and catering to a higher quality traffic is increasingly important.

It makes no sense to market to an audience that is uninterested in -- or unqualified to buy -- a site's offering (such as a web site catering mainly to corporate executives when its traffic consists of hobby farmers). It also makes no sense to spend more resources on generating new sales when repeat sales may be more cost-efficient, which in fact are often ignored.

As the business adage goes, it costs ten times more to generate a new customer than it is to keep one. Online, that adage rings even more since the Internet is littered with potential shoppers that are hard to reach. That said, it is also true that the web does make it difficult for a business to keep customers too, since an underlying benefit of the Internet is the ability that clients have to shop around at the single click of a mouse.

Therefore, since online it is harder to both find and satisfy higher quality clients, the question remains: How does one milk this sleeping cash cow? In other words, how does one build repeat traffic and especially repeat sales? While answers to those questions can be quite diverse, one solution is to incorporate the extended benefit.

It's an area that can become profitable for many online firms. In reality, extended benefits are sales promotion tools to help increase short-term sales, build client relationships, reward loyal clients, stimulate product trials or convert competitors' clients. They can also take many different forms. Here are some examples of extended benefits that businesses use:

Samples, Tools and Coupons
Samples are product or service trials. In terms of hard goods, and while web sites can offer actual samples of their products (mostly by mail), samples can also include other things -- such as soft goods that aim at informing the prospect, entertaining the visitor or rewarding the client. They include ezines, ebooks, freeware, contests, quizzes, polls, online greeting cards, forums, screen savers, web-based email accounts and so on.

For example, a site selling large exercise equipment, which is difficult to sample, can offer free, downloadable diet recipe ebooks that complement the exercise machine. Incidentally, these types of samples can become effective viral marketing tools since they are spread freely around the web. And the greatest benefit of all is that, once recipients hit the site, they are far more qualified and apt to buy than most casual, curiosity-seekers.

Sites offering other types of traffic generation tools include, among others:

- (http://bravenet.com),
- (http://www.mycomputer.com/),
- (http://webmaster-resources.com/),
- (http://www.webmastersland.com/),
- (http://www.webmastersdirectory.com/),
- (http://www.jimworld.com/),
- (http://www.webmastersonly.com/)
- And (http://www.123webmaster.com/).

Coupons are certificates that give buyers certain savings on their purchases. But coupons do not have to be physical in nature let alone limited to one's site for distribution. There are numerous web-based coupon sites and email coupon services that can be used -- such as:

- (http://www.valuepass.com/),
- (http://www.coupons.com/),
- (http://coupons.net/),
- (http://valpak.com/),
- (http://www.hotcoupons.com/)
- And (http://coupons.yahoo.com/).

Extended Warranties
Extended warranties are like insurance policies that in some way guarantee the continued performance of a product, especially after an initial period of time. While guarantees in essence promise specific benefits, warranties promise that the enjoyment of those benefits will continue. An extended warranty is like a guarantee's guarantee. And they too can take different shapes and forms, and become potentially effective profit centers.

The warranty promises that a product will perform the way it is supposed to do so for a specific period of time. In addition to guarantees, businesses should also consider selling extended warranties with their products. But if the product is guaranteed indefinitely or can not be guaranteed for whatever reason, then the warranty may take the form of future upgrades, additional benefits, patronage rewards, membership programs or support services.

For example, if an online business sells new and used computers it can also offer a buy-back plan. In exchange for an additional fee, customers receive a certificate giving them the ability to trade their newly purchased systems for better models within a year following the purchase. The plan promises them a complete refund that's applied towards their upgrade. And if they do choose to exercise their option, clients only pay the difference between the two systems.

Bundled Services
With services, the extended warranty is a little different since services are not tangible, need no repair or do not depreciate in value. Therefore, the warranty can take the shape of memberships, preferred customer programs, prepaid retainers, premium services, customer service packages, options and so on. Such warranties are in fact service agreements.

For example, a consultant can offer prepaid retainer packages or special web-only packaged programs that may include several hours of email consulting at a discounted rate. If the marketer offers repetitive services like a hairstylist or a chiropractor (such as a business offering repetitive web-based services), a number of prepaid visits can be offered at a discount. They can also extend their line in order to cater to varying segments of their market.

The latter comprises of offering several variations of one's service in order to cater to those that are quality-sensitive as well as those that are price-sensitive. An example is to bundle services together or to apply the "Olympic" approach to one's portfolio, which for example could include a gold program, a silver program and a bronze program -- each of which varying in terms of price, services (or number of services) and so on.

In addition, these programs are often more advantageous to the client above the obvious price incentive, since the value of a particular variation -- by catering to a specific segment and its unique set of needs, goals and budget -- is regarded as being of higher quality. This is one of the reasons why "preferred client clubs" are so popular. Clubs have a mystique about them. The perception is such that members feel part of an elite group to which higher priority or greater attention is given. Clubs also cater to our human need for belonging.

Preferred Client Clubs
Highly consumable products generally translate into repeat sales. Therefore, an extended benefit in this case would be a loyal customer program. This could involve a flat discount rate on all purchases made at a particular web site during a specified period of time. And what this program also does is to preemptively reduce the possible loss of a client to a competitor.

Bookstores sell avid reader membership programs that offer a fixed discount rate on all subsequent books purchased during the time that the program is in force. These programs can range from one month to a full year. Such programs can certainly be applied to the Internet, where a customer pays a membership fee and is given a username and password. In turn, that person is given access to better rates, specific products or member specials.

Again, on the Internet it is easy to shop around and to lose customers at the click of mouse. But with a discount club or loyal customer program, clients are in some way guaranteed to return to the original web site for their subsequent purchases, which removes the possibility of having them shop around when those opportune times appear. Keep in mind that these type of extended benefits can be adapted to many different situations and in different ways.

Nevertheless, one of the biggest disadvantages of the web is the fact that people are given too many choices -- too many in fact that they tend to do nothing or easily jump from one site to another. Extended benefits in this case encourage targeted and repeat customers to remain loyal, and also to spread the word around -- especially among other, qualified prospects.

About the Author
Michel Fortin is an author, speaker and Internet marketing consultant dedicated to turning businesses into powerful magnets. Visit (http://SuccessDoctor.com). He is also the editor of the "Internet Marketing Chronicles" ezine delivered weekly to 100,000 subscribers -- subscribe free at (http://SuccessDoctor.com/IMC/).