This is a continuation of the article How Great Can The Profits Be From A Consultants Website?
Prospects That You Want To Engage With
Let’s assume that 50% of your visitors are local. (This is not as big assumption as you might think, in the Recommended Actions section, I will tell you how to make sure this happens)
We said 50 new visitors a day on average and 50% of them are local. Therefore, 50 x 50% = 25 new prospects a day, therefore in a year you will get 25 x 365 = 9, 125 new prospects a year.
The standard for direct mail is a ClosingRatio of 0.5%. (In direct mail and website marketing, a ClosingRatio is called a conversation rate) A website that attracts visitors via Google is equivalent to a purchased list with little effort put into the selection criteria.
Therefore:
(Prospects x ClosingRatio)) x AverageEngagementRevenue = GrossProfit
(9,125 x 0.5%) can produce 45 new clients
Let’s assume a $1,500 daily rate, therefore 45 x $1,500 = $67, 500 in profits. (Or 45 days work)
Profits From Prospects That You Don’t Want To Engage With
Let’s look at what kind of profits are available for the prospects that for what ever reason you don’t want to be engaged with.
Let’s assume that you can create a guide that can be used by in-house staff or a local consultant to solve one or more simple problems that would take ½ day or so of your time. The guide will be related to the search terms of your site.
Assume that you receive 50 qualified prospects a day, therefore 50 x 365 = 18,250 qualified prospects.
Again, let’s take the simple assumption that only 0.5% of the new visitors of your site would be interested in your guide. Let’s further assume you sell the guide for $10.00 and they download it in PDF format. Nothing fancy, they can copy it and send it around to all the staff in their office.
(Prospects x ClosingRatio)) x AverageEngagementRevenue = GrossProfit
(18,250 x 0.5%) x $10.00 = $912.50
Not very good if you spend ½ creating the report. That is just about what you would make as a consulting engagement. Therefore, you will need to increase the price.
What if you charged, $25 for the report?
(18,250 x 0.5%) x $25.00 = $2,281.
Much better, about 1.5 times your daily rate. Or three times the amount of billable time you put into it.
What if you wrote four of these guides?
$2,281 x 4 = $9,124
Not bad, $9,1248 for two days work. We did assume it would take you ½ day to write the guide.
Profits From Existing Clients
Existing clients are a whole new different. They know you, they trust you. Therefore, if they can get your expertise cheaper, they will consider it a deal.
Let’s assume you create a report or a guide that solves a complex problem for them. You explain to your visitors that it’s worth two days of consulting time, but because of volume and the non-specificity of the report, you are only charging the 25% quarter of its value. ($3000 x 25%) = $750.00
Let’s assume you have 50 clients that have you used your services over the last five years and were pleased with the results. Let’s further assume that 0.5% of the people who bought your $25 report are willing to purchase your new expanded $750.00 report. 912 x 0.5% = 5.
Therefore,
(50 + 5) x $750 = $41,250
Now let’s total up all your revenues:
| New clients |
$67,500 |
| Prospects you don’t engage in |
$9,124 |
| Existing clients |
41,250 |
| Total |
$117,874 |
The writing will take 2 hours x 2 articles per week x 4 weeks per month x 3 months = 48 hours or about 6 working days.
Very nice indeed, $117,874. for working 56 days. (45 + 2 + 2 + 6) Or an average of $2,105 per day. An increase of about $600 on your daily rate.
A couple of questions to consider about my assumptions.
What if your ClosingRatio is 1% instead of 0.5%?
What happens if your articles drive 75 prospects a day to your website?
Click here to read Zale’s Recommended Actions To Generate Website Profits
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