Future Bank Account

by Tim Francis on January 17, 2012

There are two kinds of bank accounts – the Present Bank, and the Future Bank.  Neglect either and you can get yourself into trouble very quickly, and/or miss huge opportunities for profit.

I would like to thank Dan Kennedy for bringing this to my attention as I was reading his book No B.S. Ruthless Management of People & Profits.  He succinctly explained the concept of Future Bank with an excellent example:

Image you own a restaurant.  You offer a Birthday Club where customers can register with their contact info and date of birth.  Then, a few weeks before their birthday they will receive a gift certificate in the mail allowing them a free meal at your restaurant on their birthday.

Over time, let’s say that this Birthday Club grows to 2,300 people.  You figure out that approximately 70% of people take action on the gift certificate and actually come in on their birthday for their complimentary meal.  When they come, they typically bring 3 friends, and the average bill for those three people is $100.  You also observe that the typical customer returns for 3 years.

The math works out like this:

  • 2,300 people in the Birthday Club X 70% redeem on their birthday = 1,610 redemptions / year
  • 1,610 redemptions / year X 3 years = 4,830 total redemptions
  • 4,830 total redpemptions X $100 spent by 3 friends = $483,000 in revenue

That’s $483,000 in the “Future Bank”.  By setting up a program like this and having a sense of the Future Bank of your business, consider some of the advantages it would give you, to name a few:

  • If you’re considering selling the business – you can include this program as a key selling feature – would give the buyer greater confidence in their purchase from you
  • The above calculation only includes these Birthday Club members coming in on their Birthday; if you do a good job on their Birthday, they may come back on other days of the year too
  • If you’re thinking about a renovation to your location, or some kind of expansion of your business, and you have a good sense of this Future Bank, how much more stability and confidence does it give you to move forward with things?
  • When it comes to Free Meals, it’s an easy sell.  In fact, when someone comes in for their Birthday you could easily ask their 3 guests if they would like to join the Birthday Club too.  In fact, you could ask everyone every day of the year.  A free birthday meal is a ridiculously compelling offer.  What exists in your business that is similar to that?  I bet you there is something if you gave it some thought…
  • With the customers in your Birthday Club database, you can easily send them other promotions too

…and on and on and on.

All of this rests on the larger principle of establishing, then growing and nurturing your database.  And this includes not only people you’ve sold to, it also includes leads and prospects that need to be nurtured towards a sale over time.

As the saying goes, “People don’t buy when you’re ready to sell, they buy when they’re ready to buy.”  Staying top-of-mind with your leads, prospects, and customers, ever-deepening your relationship with them over time makes you the obvious choice when they are ready to buy not just once, but again and again.

Hope that Helps,


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