This is an important stage of the funnel where you start generating the revenue.For a consultant, this would be when you get the signature on the contract, and for a SaaS company, this would be when your customers make their first payment for the subscription.Whatever it is, but it is surely not the end of the customer journey. Don’t stop here; you are only 4/6th of the way through the funnel.Be very careful at this stage as it can have an impact on the bottom line of your business.You need to continue delighting
your customers by offering attractive annual plans and best-in-class support. 86% of customers will pay more for better customer experience.Once someone makes the payment, your job gets much more comfortable as you know who your customers are and what they need.It is cheaper to drive a repeat purchase from a present satisfied customer then Bahamas Phone Numbers acquiring a new one.Businesses have a 60 to 70% higher chance of selling to an existing customer while the probability of selling to a new prospect is only 5% to 20%.Few mistakes and you will get demoted to the acquisition stage of the funnel where you will have to start it all over again with a new prospect. 33% of Americans say they’ll consider switching companies after just a single instance of poor service.
How is revenue linked to the other AARRR metrics?
By now you must have realized that none of the AARRR metrics are self-standing, that is why we look at it as a framework.For a company to succeed, it is mandatory to do well at all the stages of the funnel.Let us see how revenue is affected by the other metrics of the AARRR framework:
Acquisition
AcquisitionYour revenue will grow with each new customer, but the cost will go up faster.High acquisition cost decreases the net revenue of the company; the more you spend, the less profit you earn.What is the point of getting $300 from a sale when your customer acquisition cost was $250? Therefore, it is necessary to optimize your acquisition strategies and invest in the channel that introduces you to lucrative opportunities.
Activation
ActivationWrongly acquired lead is like that piece of a jigsaw puzzle that doesn’t fit. You put in all the efforts to complete the puzzle and in the end realize your efforts were in vain because of a single incorrect move.Similarly, during sales activation, a wrong lead can lead to a waste of time, money and resources.They might abandon you at any stage of the funnel, which directly affects the revenue of your business. Read how to activate the right people here.Retentioncustomer retention
“Retention is the single most important thing for growth”- Alex Schulz
If people are unsubscribing your service in a few months or not returning to your store, then how will you increase your revenue? You are just stuck in a vicious circle of acquiring and losing customers.Retention in the only way to reduce churns and boost your revenue. Increasing customer retention rates by 5%, increases revenue by 25% to 95%.
Referral
ReferralTurn your existing customer into a referral magnet to increase your revenue in a short time. There should be some USP of your product that motivates your users for recommending it to their networks.It is difficult to rely on the customers coming from random sources for steady revenue growth; they might quit at any point.However, the ones referred by a satisfied customer are more likely to stay loyal. Referred customers have a 16% higher lifetime value.
