Why You Need To Give It Away for Free

What would you be willing to give away in exchange for a potential new customer’s email address? What is the value or worth of having one new customer? Answering these questions will help you understand what you need to promote on the homepage of your website as a powerful way to grow your business. Let’s dive in a little deeper. 

First, let’s talk about the lifetime value of a customer. Knowing this number will help you create a reasonable offer that you can use on Facebook, in print and especially on your website. There are a number of fancy and complicated formulas to figure this number out so I like to use a simple version provided by the folks over at Social Media Examiner. It goes something like this: 

(Average Sale per Customer x Monthly Frequency) x 12 Months = Annual Customer Value
Then …
(Annual Customer Value x 5 Years) x 2 Referrals = Lifetime Value

Here’s an example if you own a restaurant: 

“To illustrate, suppose you own a restaurant. When a new customer walks in the door, he spends $20 per visit and visits twice a month on average. Using these figures, your business earns $480 ($20 x 24 visits) in yearly revenue from this customer. On average, a customer stays with you for around 5 years ($480 x 5 years = $2,400) and refers at least one other person ($2,400 x 2 people = $4800), giving you almost $5,000 in LTV for that customer.” Source

Social Media Examiner

With that number in mind, what would you giveaway or offer to get people to come into your restaurant (or store)? That’s what you want to have on the homepage of your website. 

Let’s talk about the other kind of featured asset. This is where you give something away for free in exchange for an email address. Aside from a featured asset, this is also referred to as a lead magnet or freebie

What do you give away for free in exchange for an email address? These can be a guide that you’ve created, a worksheet, coupon or free sample. You’ve probably seen these online before. You simply type in your name and email address and then you’ll have access to download the freebie or access the giveaway. With their email address, you can then use an email management system like Mailchimp or Constant Contact to send out periodic emails with tutorials, offers and other things that will lead them down the path to becoming a new customer. 

Some of the lead magnets you may have seen on my website include the 20 question quiz that evaluates the effectiveness of your homepage, my 20 point checklist for a better homepage, a worksheet to discover your ideal customer and a free video for your business. All require an email that I then use to send out my weekly newsletter. 

  • TIP NO. 01 Let viewers know that you won’t spam them or sell their email. Instill confidence that giving you their email is safe. 
  • TIP NO. 02 Do it in a video to see an increase in the number of people filling out your form!

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