That’s not a typo.
If you want to grow your sales, increase your refund rate.
Now, before you dismiss me as off my rocker, let me ask you a question.
Then I’ll show you how to do this.
Would you be willing to double your sales if it meant increasing your refund rate by 50%?
Before you answer, let’s see what would happen if you did…
Say right now you’re generating 100 sales at $50 each. A total of $5,000 in revenue.
And let’s say you have a ten percent refund rate.
That means out of those 100 sales you refund 10 people. So you refund $500 leaving you with a net of $4,500.
Now let’s see what happens if you increase your refund rate by a hefty 50% while doubling sales.
Now, you generate 200 sales at $50 each. A total of $10,000 in revenue.
With your 50% higher refund rate (15%) you now refund 30 people. That’s $1,500 in refunds.
Leaving you with a new net total of $8,500.
$8,500 of profit versus $4,500… a 188.89% increase in profit even after increasing your refund rate by 50%.
Fact is: Even if you only grew sales by 50% while increasing your refund rate by the same 50% you’d still come out with $6,375 in profit after refunds — an increase of 141.67%.
Even more staggering…
Even if you only grew sales by 15% while increasing your refund rate by 50% you’d still come out with $4,887.50 in profit after refunds — an increase of 108.61%.
So, even if I changed my original question to “Would you be willing to increase your sales by 15% if it meant increasing your refund rate by 50%?”... the answer should still be YES!
And here’s how you can begin doing it…
It starts with recognizing…
As a marketer, you’re NOT in the business of reducing refunds. You’re in the business of increasing sales.
(Read the above paragraph as many times as necessary until it sinks in. Print it out… circle it… tape it to your computer. Whatever’s necessary to never forget it.)
A focus on engineering marketing to keep refunds at their lowest level possible will suppress new customer sales and hold your business back.
Your aim, when engineering any marketing campaign, is to increase sales as much as possible. Even if it means increasing your refund rate at the same time.
As long as the increase in sales more than compensates for the increase in refunds, you should be thrilled. Dancing.
There are no awards for a lower refund rate. No bragging rights. No top 100 list of the lowest refund rate companies. All of those are reserved for sales.
So how do you increase ’em?
With a bigger, bolder more audacious offer, that’s how.
As an example…
Moving from a hard offer (i.e. pay upfront) to a soft offer (i.e. get the product today and pay in 30 days), you’ll almost always see a hefty increase in sales conversions.
And… of course… you’ll almost always see an increase in refunds/non-payments as well.
But so what?
Almost always your increase in sales will far outweigh any increase in refunds.
So it’s a victory.
Remember: You’re not in the business of reducing refunds…
You’re in the business of increasing sales.
Sadly, many entrepreneurs and marketers don’t get this. They allow their irrational fear of increasing refunds to hold them back from having the most powerful marketing possible.
Don’t be them.
Get over it.
P.S. If you’re still not generating new customer sales every day, and want me to show you how to do it using my E5 CAMP Method, go here and checkout the free training.
It requires some time and work, but is producing some staggering sales numbers for marketers.