Part 1: How understanding your metrics can influence sales online.
It seems everywhere I turn lately, I see small business owners struggling with a drop in sales, both online and offline.
Is it the election? Is it a wider economic downturn? Is it because of end of financial year?
Clearly businesses are hurting. The stress and anxiety is almost tangible.
And trust me when I tell you, I totally know how this feels.
Here are some of the business lows I’ve had to deal with in the past:
- Paying production bills in USD when the exchange rate got down to 60 cents in the dollar during the GFC.
- Losing an entire shipment of brand new stock in the Brisbane floods.
- One factory going out of business and taking hundreds of metres of my pre-paid custom-printed fabric with them.
- Finding one of my highest-selling designs had been copied and made available on Alibaba and then re-sold to a competitor of mine in Australia.
Truth smack: shit happens in business. That doesn’t mean your business is not, or won’t be, a success. HOW you deal with these lows will mean the difference between your success or otherwise.
We all know that the journey of an entrepreneur is like a rollercoaster, with peaks and troughs in business just as there is in life.
But it is possible to cope with all these difficulties – indeed, to come out the other side with guns blazing and to actually soar to new heights and achieve new levels of success.
Well, I’m not sure if there is one single key answer to that, but a BIG one that I see soooo many small business owners completely miss out on is: knowing their key metrics.
Take-out: Implementing this in my own business represented a big jump forward in my sales growth, and in my ability to generate consistent, predictable and reliable sales each month.
What are ‘metrics’?
Essentially, ‘metrics’ are your key performance indicators. They’re the numbers you want to track and measure in your business, because they relate to the activities most likely to affect your sales performance.
That sounds a bit stiff and corporate and like a total bore, I know. So let me show you how easy it can be, as well as how it can influence your sales growth.
For an eCommerce website, the sorts of metrics you’d want to begin monitoring include:
- unique visitors to your website,
- time spent on site, bounce rate,
- abandon cart rate,
- conversion rate (that’s number of visitors who convert to buyers),
- and average order value.
I’m going to address some of those now, and some of them I’ll talk about next week in a follow-on training.
First two metrics you must know
The first two metrics you absolutely need to know are:
- Your conversion rate (what % of website visitors convert into buyers), and
- Your average order value (what is the average $ value a customer spends per order).
Once you know these two numbers, you can then work out how many visitors you need to get to your website in order to achieve your sales goals.
And when you know how much traffic you need, then you’re in the driving seat! You can concentrate your efforts on your best traffic sources, knowing that if you get the right number of eyeballs on your website, you’ll generate the sales result you want.
Watch this training video
Need some help generating traffic?
Now, I know I’ve touched upon the ‘what’ you need to do in this blog post and training video.
If you need some help with the ‘how’ part, that is, ‘how do I go about getting the right number of visitors to come to my website’, then let’s talk.
The right mix of activities to generate traffic to each individual website is never the same for each business, but I have a solid process for working out what the right mix is for you.