Products and offers play different roles in our businesses.
Here are six roles a product can play in your business that are not profit-based.
The caveat is to be very clear about what each product's role is in your business and, therefore, how it should be priced. Numbers 1-3, for example, can be hard to price well because they need to happen before people pay you for higher-priced offers.
Welcome to Part 2!
Last week I talked about tracking the individual profitability of each product, offer, or business in your portfolio. You might want to go ack and read that article.
This week, let's look at some of the reasons you might not care primarily about the cash profitability of a product or offer. Clearly, a whole business should be profitable.
1. It is a list-builder.
Some products are designed to bring in the ideal audience that will make other products more profitable by increasing the number of eyes on the offers.
Retailers keep some unprofitable products around because they get people into the store. Once we get into the store, they can tempt us with other valuable offers.
This should be a low-cost or free product. It should create and satisfy an immediate curiosity.
2. It builds your authority
Sometimes you first need to establish that you know what you are talking about in the area that is important to the customer. On some level, you have to establish yourself as a leader, mentor, expert, or authority - even if your brand voice is not any of those things. See #3 below.
This needs to be done early in the customer's interaction with you, and affordably. People won't pay you to establish your expertise in their eyes.
You might do this with an eBook, PDF, case study, compendium, or walk-through video.
Curated offers can increase your authority, like, "Based on my [expertise/authority/experience], these are the best options for XYZ."
Sometimes, establishing authority can be done in a sales page itself.
A hotseat-style offer (or, part of an offer) can be good for this because it lets them see you in action somehow.
3. It adds to the know, like, and trust factor
This is a product that reveals your personality, likeability, and reliability.
It makes your audience stickier. They'll wait around longer for and gobble up more offers, if they kinda dig your whole vibe and see you as a resource or partner in whatever they are trying to accomplish.
This might be an audio product, an online community, or whatever you think allows you to shine.
4. It tells the story of your business or brand
Sometimes you might build a product just to reveal the scope of your brand. What don't people know about your brand? What might they not naturally think you offer?
For example, if you do three things, you might create 3 easy intro products that remind your audience that, oh yeah, I do that, too. Or, oh yeah, people who need XYZ buy from me, too.
You also could use these products to communicate that you have DIY, DWY, and DFY offers.
You also may use this to communicate your brand values. For example, if you sell Bible summaries, you also might sell Bibles because you value people reading the Bible for themselves.
5. It increases the likelihood of purchasing another product or offer
These are your product pairs: Add-ons, tripwires, upsells, twofers, bundled offers, ascension offers, etc.
Selling peanut butter increases the likelihood of selling bread and jelly. The way a retailer might look at this is to ask, "When we look at the profitability of the trio, are we more profitable than if we didn't stock one of them?"
In that case, it may be OK that peanut butter individually actually is unprofitable.
**This is an example as I don't know the actual profitability of PB&J sandwich ingredients.
If you do multiple things, even unprofitable offers can whet your audience's appetite for larger, related, and more-profitable offers.
6. It drives visitors to your online hub
You might create a product that requires your audience to visit your website or FB group every day, and that is the sole purpose of that offer. Once they get to your website or other hub, you can help them in all sorts of ways.
This is a traffic-driver, like a list-builder from #1, but even people on your list need to be driven to your hub periodically.
You might create an offer that includes a challenge or weekly livestream for this. You might create a paid blog for this.
Fred gets it!
If you haven't already done so, I suggest you go back through your product list and make sure you can clearly identify what role each product is playing in your business.
Do you have something in place to play each of these roles?
Then make sure the investment (including non-monetary) you are making in each product is commensurate with the role it plays in your business.
These products may, in fact, be profitable, too. If they aren't, they still may be worth building or keeping IF they successfully fill one of these other roles.
Big Love!