Knowing the difference between a business’s front and back end is very helpful.
I first heard this from another marketer many years ago and want to discuss it in this post.
What is the Front End of an online business?
The front end of a business is everything involved in acquiring a new lead or customer.
This includes things like:
- Generating traffic through organic or paid online advertisements
- Using lead magnets to create leads and a fan audience
- Acquire a new customer by offering a low-priced product (sometimes called a trip wire or lost leader)
There is a lot of work in the front end.
The focus is driving traffic to your content, web pages, videos, and anything else you do to promote yourself or your products online.
The payoff feels very small for all the work that goes into it. There tends to be a lot of trial and error, frustration, and confusion.
Driving organic traffic might mean spending a lot of time writing content and posting information online on social media, blogs, forums, and other places.
If you are advertising, you spend money driving traffic to your sales funnels and opt-in pages.
When the payoff is small, it feels like you are running your business into the ground. Many entrepreneurs quit at this stage.
However, the front end is the engine of the business, which generates new leads (and eventually customers) and is critically important.
So, where does most of the profit come from? The back end of the business!
Here are the core components of the Back End of the business:
The back end focuses mainly on the follow-up process for your leads, audience, and fan base, including tasks such as:
- Follow-up emails to your leads and fan audience via email (or blogs/social media/other platforms) with more information and content to build a relationship.
- Offer higher-priced products, such as high-ticket and recurring revenue (subscription-based).
I heard a marketer once say the money is in the follow-up, aka the backend of the business.
Other marketers express how the backend is where the money is made.
On the back end, it becomes easier to make a profit because you paid the price for it on the front end through the challenging acquisition of getting a lead or new customer.
The profit comes in many forms, such as customers buying more of your products, buying consistently, or purchasing a luxury or high-end product or service with high profit margins.
You finally get paid for all the time and costs associated with upfront acquisition.
I like to differentiate the two parts of the business.
It can feel frustrating when business is slow or you try something that does not work.
During these times, you naturally spend more time on the front end acquiring new customers.
But it can become challenging to remember the backend, where most of the money is made.
It would be best if you got through the hard times to experience the rewards on the backend!
This is the journey many of us entrepreneurs take to see our business thrive!