How to Make More Money On EVERY SALE
Summary
- Every business can add 4% to their revenue by including credit card fees. Customers usually don't mind paying this extra charge.
- When customers purchase something and see a 4% credit card fee, they typically agree to pay it without hesitation.
- For a better approach, offer to waive the 4% fee if the customer provides a second credit card.
- This strategy is particularly effective for recurring payments because it reduces involuntary churn.
- By having a second card on file, you can decrease churn by a third.
- At the very least, you'll earn 4% more revenue, but ideally, you'll get a second card and increase the lifetime value (LTV) of each customer.
Video
How To Take Action
I would suggest implementing a strategy to increase your revenue by adding a 4% credit card fee. Most customers don't mind paying a small extra charge, especially when it's clearly communicated during their purchase. This way, you can easily add 4% more to your revenue without reducing your sales.
Next, to make this even better, offer to waive that 4% fee if the customer provides a second credit card. This is particularly useful if you have customers making recurring payments. By having a second credit card on file, you'll significantly reduce involuntary churn, which happens when a payment fails due to issues with the primary card.
Here's how to do it:
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Add a 4% Credit Card Fee: Inform customers about the 4% fee when they choose to pay by credit card.
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Offer an Incentive: Let them know you can waive this fee if they provide a second credit card. Frame it as a benefit for them, saying it can prevent interruptions in their service.
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Explain the Benefit: Clearly explain that having a second card helps ensure their service won't be interrupted due to payment issues.
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Monitor and Adjust: Keep an eye on how customers respond to this change. If you see an increase in revenue and a decrease in churn, you're on the right track.
By doing this, you'll not only earn more from credit card fees but also increase the lifetime value of each customer. It's a straightforward, cost-effective way to boost your business without spending a lot of time or money.
