Approach Of Revenue Management Solutions Towards e-Commerce

 A business generates revenue through three basic ways; acquisition, retention, and expansion. The acquisition is getting new customers, retention is making those customers renew subscriptions or enable repeat purchases and expansion is cross-selling or up-selling for the existing users. 

A revenue management solution is a process of optimization to acquisition, retention, expansion, and pricing approaches for the growth of profits and business health. By allowing revenue management, it not only bears the impact of earning from individual sales but rather it also improves the sum of income. 

Managing Different Portions of Revenue

There are four levels of approaches to work on while managing the revenue; acquisition, retention, expansion, and pricing. Every approach needs to be given equal consideration while working for the maximum results from every space. 

Optimizing the pricing strategy will affect acquisition, retention, and expansion areas. Enhancing customer retention can boost acquisition, expansion, and finally influence pricing. 

1. Acquisition

To make the best out of this strategy, the business should acknowledge and attract the target audience that offers the most revenue while simultaneously keeping the customer acquisition cost low as possible. 

The basic approach to doing this successfully is to build connections and col-lab with teams across the company for definite buyer personas. Creating this ensures  that the business’s investment is marketing into interacting with ideal prospects are likely to become successful customers. . 

2. Retention

When it comes to retain existing customers, it gets cheaper thanit is to acquiring new ones. With increase of retention rates up to 5% can directly proportionate in increase of profits with 25-95%. 

Making this strategy successful, the business needs to consider various things such as; meeting the customers expectations, aligning the value of product with the price being paid, contacting for queries and mentioning feedback for the products received.

An important aspect for customer retention is to help customers get value from product. The knowledge based articles, training and descriptions should be clear and informative about the product. Another major aspect that needs to be covered is customer feedback that analyzes the most valued products, and where the products needs to be improved. This identifies the best-fit consumers. Therefore, both formal and informal feedback is essential. 

3. Expansion Revenue 

This strategy comes in action through up-selling and cross-selling the existing customers. To improve expansion strategy the customer retention needs to be improved. Customer feedback should be checked which can make sure that the current product being sold is a success. This success can help the business in expansion by promoting similar products. A customer having a positive experience with the company and the product, is more likely to continue doing the business.

4. Pricing

It may appear deceptively easy to optimise the pricing strategy to maximise revenue: choosing a price that allows you to turn a profit while also selling enough units to cover your costs. The pricing methods of competitors should also be taken into consideration because they affect how clients view your brand and business as well as their likely to pay what you're asking for.

In order to maximize profit from both individual sales and individual consumers at the same time, you need to think long-term about pricing. The objective of pricing plan should be to promote producing recurring purchases since retention and expansion are more profitable than acquisition. 

The revenue management solutions enhances the growth of e-Commerce businesses by predicting the customers need and monitoring the changes with the selling f products. Bright directories enables the payment gateway for your business by customizing solutions that are specific for your country.