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The Money Making Secret of "The Toll Booth Position"



Jesus The Great Teacher --Lessons Learned
I don't know of anyone who really liked taking tests in school if you did there is something seriously wrong with you. It just seemed as though some breezed through while people like .....
Im a marketing consultant and at one of my client-companies, acompany that, in less than 10 years, has gone from a $10 millionto a $100 million dollar business one of the people I work withfrequently has jokingly given herself the title, 'Vice President,Back-End.'



Although that clearly opens her up to be the butt of many jokes,it does very accurately describe her very, very important area ofresponsibility, in direct marketing parlance. At least 80% of thecompanys profitability depends on her contributions.



If the term "back-end" is new to you, it means everything yousell your customers after their initial purchase (that firstorder is called the "front-end"). For instance, lets say yousell instructional video tapes to golfers on how to play better.You advertise in golf magazines and your lead product is a $25video on putting strategies. Thats your "front-end" becausethats what people buy first. But then once people purchase thatfirst video, you send them a catalog offering them over 50 othergolf videos ranging in price from $50 to $99. Those follow-onvideos are your "back-end."



In many businesses, there is a relatively brief period of timeduring which there are significant, exciting profits on thefront-end, that is the very first sale to a customer.



But that happy situation dissolves over time, as you "cream" themarket. And, as you go deeper and deeper into a market, the costof making the first sale (acquiring a customer) goes up and up.For instance, in the above example of the golf videos the firsttime you run a magazine ad you might pull 100 orders. But if youkeep running it every month, your order volume will probably dropoff steadily. Within six months, youd be lucky to be selling 30videos from the same ad in the same magazine. As some point, itgets so high it is no longer practical to advertise and sell thatproduct to that market.



Nothing is forever. This fact of life is what mandates beingsmart about making all the money that you can from the back-end.



The good news is that your satisfied customers are probablywilling to buy other things from you -- and they dont even haveto be your own products/services. You can make deals with othercompanies to offer their products/services to your customers inexchange for a piece of the action.



For instance, lets go back to our example of the golf videocompany. You might do a "joint venture" with a manufacturer ofspecial golf clubs which sell for $1,500 a set. Youll mail aletter to your customers telling them how well these clubs willimprove their golf game and youll get $750 on each order placed.If your customers trust you, theyll be much more likely torespond to your letter than they would be if the golf clubmanufacturer mailed to them directly.



Of course you only want to recommend high-quality products andservices which will be of value to your customers. But you getthe idea. You could make similar deals with other companies whosell what golfers want -- golf apparel, golf trip and excursionoperators, even custom home builders who sell houses near golfcourses. Theyd all happily pay you a 'toll' commission to selltheir wares to your customers.



No matter what your business, one of the most valuable assets youhave is a list of satisfied customer, predisposed to buy from youagain. When you control a sizable list of customers who boughtfrom you, know your name/business name, are happy with what theybought and with the ensuing relationship ... and are pre-disposedto read your mail and buy from you again, its like owning yourown "toll booth."



A pioneer of direct marketing, Harvey Brody, taught me the powerand value of getting into "The Toll Booth Position" and Ive beenteaching it for years. Imagine owning your own toll booth on thehighway near your city. Anybody who wants to get to the otherside of that toll booth has to pass through its gates and pay youmoney.



As the controller of a responsive customer list, thats exactlywhere you are; sitting there in your own toll booth and anybodywho wants to get their appropriate product or service to thosecustomers you control, has to pay you money.

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