The Product Funnel
It’s easy enough to say that you need a product line. But how do you plan and produce a product line? What does it mean to have a line of products as opposed to a product or just a bunch of products? I believe your best chance for success in the supporting (or back-end) product area is to fill as many positions in what I call the “Product Funnel” as you can.
Over the years, I’ve created my own version of the famed Product Funnel. Picture in your mind a funnel. Coming in the top of the funnel are prospects. You obtain these through all the lead-generating techniques we’ll talk in other articles. Every prospect who buys something purchases what for that customer we can call the front end product. The vast majority of your first-time buyers will purchase something from you that represents low risk, high potential return, and gives them a chance to get to know you as an information provider.
Once you have converted a prospect into a customer by selling him or her anything, the Product Funnel concept comes into play. You want to sell that person one copy of every product in the funnel. To do this, you’ll use a technique called “upselling” which involves convincing a customer to buy the next higher-priced item in your product line. Once they’ve done that, they become a candidate for the next higher-priced item. And so it goes.
This is not to say that some people won’t come into your product funnel at the highest price point (for example, a consulting gig) and then buy other, lower-priced products. Nor is it to imply that someone who comes in at, say, a $30 price point (by buying your book, for example), isn’t going to leap right up and become a consulting client or buy into your expensive three-day bootcamp. But most of your customers will tend to enter the funnel at a reasonable price point (under $50 as a rule) and then be willing to buy up in price as they get to know you and the quality of your work.
I recommend that you define and create products at least at the following approximate price levels as you design and fill out your product line:
- $10 or less (a special report, excerpt from a book, special issue of a newsletter, research study).
- $20-40 (typically a book; we’ll talk shortly about why having a book is such an important idea for you as a seminar leader)
- $100-$200 (audio or video cassette collection or, in some cases, individual training videos)
- $300-$500 (one-day seminar or perhaps a seminar-workshop or a half-day workshop)
- $600-$1,000 (bootcamp or multi-day intensive seminar/workshop)
If you follow this formula and then design a careful tracking and followup system (using email autoresponders at your online store is easily the best way to accomplish this, particularly if some portion of your product line can be made electronically deliverable), I can guarantee you that you’ll see increased income.