Let's do the
numbers…
Think about this:
Who is your largest,
most successful competitor?
Are they more expensive than you?
Why do they win business even
though their prices are higher?
Perhaps it's because they sell "affordability" not price.
That is, they offer financing.
Not convinced? OK. Let's do the numbers.
For example:
Average sale = $13,000
Margin = 20% ($2,600)
Cost of a qualified lead = $350
(industry estimate)
Currently, you average 3 orders for every 10 customers you meet with.
This means you are spending $3,500 (10 leads) to make $7,800.
If, by offering financing, you could increase your win rate by one, to 4 of 10,
the same $3,500 investment will make you $10,400. Keep in mind your results
could be even better.
Now, let's say that in addition, you are able to use financing to increase
the average order size to $15,600. Now, you will make $12,480 (Remember: With
GreenSky, customers can be approved for more.)
If you include your financing offers in your marketing materials, on your website and
in every email offer, you'll attract customers who would not have called otherwise,
which could reduce the cost of each lead.
Offering financing has the potential to significantly improve three critical elements
of the profitability equation: Lead Cost, Win Rate & Average Sale.
*All examples are provided for demonstration purposes only.
10
