8 WAYS TO ENTICE CUSTOMERS TO PAY FOR THE PRIVILEGE OF BUYING FROM YOU – BUYER CLUB

Do you have ways to entice customers to pay for the privilege of buying from you?

The "normal" way of buying

You know how things work when you go to the store.  You enter the store (both bricks and mortar and also "e-commerce" stores).  You walk around looking at what is for sale.  You see things that you want to buy and you put them in your cart.  You pull out your list and then gather the items that you need to buy.  Perhaps you comparison shop between different items.  You browse the sale items. Then you go to the check out register.  Your items are scanned and then you pay for them and leave the store.
But what if you needed to buy the privilege of buying from you?  What is you needed to previously purchase a "participation" card who's only value was the ability to check and buy from that store?  Wow…what would you think of that?

Do you have a membership option for your customers?  A buyers club?

Well, that time is here.  It has been for many years and there have been many different iterations of this type of program.  Some have been "buyers clubs" where you could purchase big-ticket items for wholesale + a few percent. Others were "wholesale clubs" such as Costco and Sam's Clubs, where you could buy items in bulk at much lower prices than in regular retail stores.  "Photo" clubs where you could get a better price on purchasing of your photo prints.  These are just a few of the different types of programs where customers purchase the privilege of buying from you.
In some cases, joining the club is free.  In others, it costs you real money to join.  Which do you think holds more value to the customer?  You bet…it's the one where they buy the privilege.  When you pay for something, you place a greater value upon it.

Why you should develop a buyers club for your business

So, let's see what value these type of buyer club programs have to the retailers

• Repetitive business-When your customers belong to a "club" they want to be an active part of the club.  It's association. They want to get their "money's worth" so they come back for more purchases - and more discounts.
  
• Increased number of purchases- Although customers are provided with a discount, and your "profit" seems less than selling at a higher price, the fact that customers are more likely to come back to the store where they are a "member" provides you with higher volume of sales.  More "turns".  This results in higher profit from volume.
• Increased amount of stock that you are turning over- By selling more product, the retailer may be able to gain a better discount pricing from the wholesaler, which can help them regain part of the profit lost from selling at a lower price.
• The membership price is the profit-This is pure profit.  Even if people don't visit on a regular basis, the retailer has already pocketed the full membership price as profit.  Think of it in this way.  If the retailer charges $100 for the privilege of allowing you to shop in the store, and if they previously had a 1% profit on products (typical for a grocery store), that membership alone is the same profit as selling $10,000 of groceries!  And, there is no spoilage, stocking fees, additional employees, etc. 

So think of it this way…if your profit from your average customer is less than the price of a "buyers club" card, you actually make more money by having the buyers club program and selling your product at an exact break-even price.  If you shave your margin to 50% (for a grocery store..to 0.5%), then you would still be ahead in the previous illustration until the customer purchases $20,000 of product!

What can you offer in a membership?

But these programs are not limited to grocery stores.  Nor are they limited to discount pricing.  Are there OTHER benefits that you could provide with such a program?  Let's look at some possibilities.

• "Club-like" feel - Making your business upscale can provide a true "luxury" feel to your services and products.  Think of the high-end car dealer who has luxury waiting rooms and computers available. How about a "shave and haircut" club, only open to members.  This may be a good model for a continuity program.
• Special access hours - Give your special customers special hours, where there is additional help on hand.  Less crunch of other customers.  More relaxed atmosphere.
  
• Special discounts - This is easy.  Provide additional discounts to people who join the club. I recently purchased a "discount card" for toner and ink.  It's a $20 card that will give me 10% off for 12 months.  I know I will use it and benefit from it, but there are a LOT of customers who will buy the card and lose it or never use it.  The discount card price is pure profit for the store in those situations.
  
• Member only benefits (Free coffee?  Donuts?) - Could your members be looking for something special. A little better treatment?  A nice place to sit or snack?  You create that atmosphere for your customers and provide it ….for a premium!
• Free delivery - Think Amazon prime.  About $100 per year for a variety of services, including free delivery.  Now think again….not discount on services or products..only on delivery.  That discount is worthless UNTIL you BUY something from them.  It's a great program for those who buy a lot…but I am sure it's sucked in a lot of people who never get their money's worth.
• No tax on purchases?- No, you can't waive the taxes that have to be paid, buy YOU can pay those taxes…and it's a great promotion to get people to buy from you.  It's not just the few percent of cost…it's the impression that they are "getting away" with something.
  
• Extended warranties- You can potentially provide this at a very low cost. There are many different creative ways of providing this.  There is one retailer that I know of that is so large that they have their own warranty division. They can buy the products for lower price because they have an arrangement with the companies to not include the "factory warranty".  In this case, the retailer saves on the wholesale cost, provides a longer than manufactures warranty and comes out cheaper, because they only sell quality items that typically don't need as many repairs.  What a GREAT concept!
• Guaranteed repurchase of products- Do people only need the item(s) for a short period of time?  Maybe a wedding dress shop will buy back "gently used" wedding dresses for 50% of the original price.  Then they can re-sell those same wedding dresses a second time.

Now it's up to you…What type of services, bonuses, premiums or other features can you offer to your customers…for a price.  This opportunity can provide an additional source of revenue to your business and help repeat business.  Share with others below what you can …or are…doing in your business to tap into this potential!