Metrics for Online Retail (Shopify/.CO/Luxr webinar)

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We discuss the three key metrics that online retailers should be watching and pushing and why they're important. We also cover a simple framework for making experiments to help drive those numbers.

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Metrics for Online Retail (Shopify/.CO/Luxr webinar)

  1. 1. Metrics For Online Retailers Shopify’s Build a Business Competition Janice Fraser Jason Fraser March 5, 2014
  2. 2. Jason Fraser Founder Master Coach © 2014 Luxr Incorporated www.luxr.co
  3. 3. Who is ? Supporting entrepreneurs worldwide Video based curriculum Short video workshops In-person workshops around the world © 2014 Luxr Incorporated www.luxr.co
  4. 4. Follow Us @luxrco Event Hashtag #retailmetrics © 2014 Luxr Incorporated www.luxr.co
  5. 5. Gather Your Tools © 2014 Luxr Incorporated www.luxr.co
  6. 6. 3 Key Metrics Acquisition Conversion Dollars per sale © 2014 Luxr Incorporated www.luxr.co
  7. 7. How do I find my numbers? has some basic features Google Analytics © 2014 Luxr Incorporated www.luxr.co
  8. 8. How do I find my numbers? Buy a clicker! © 2014 Luxr Incorporated www.luxr.co
  9. 9. How do I find my numbers? Buy a clicker! © 2014 Luxr Incorporated www.luxr.co
  10. 10. How do I find my numbers? Buy a clicker! Keep a log by the register © 2014 Luxr Incorporated www.luxr.co
  11. 11. How do I find my numbers? Buy a clicker! Keep a log by the register © 2014 Luxr Incorporated www.luxr.co
  12. 12. How do I find my numbers? Buy a clicker! Keep a log by the register © 2014 Luxr Incorporated www.luxr.co
  13. 13. How do I find my numbers? Buy a clicker! Keep a log by the register © 2014 Luxr Incorporated www.luxr.co
  14. 14. How do I find my numbers? Buy a clicker! Keep a log by the register © 2014 Luxr Incorporated www.luxr.co
  15. 15. Why? Make informed decisions Move the numbers Make more money © 2014 Luxr Incorporated www.luxr.co
  16. 16. Metrics Pattern Observe © 2014 Luxr Incorporated www.luxr.co Act Observe
  17. 17. Acquisition How many people come to your store? Your Store © 2014 Luxr Incorporated www.luxr.co
  18. 18. There are many ways to acquire customers Paid traffic Mailing lists Search results Social media © 2014 Luxr Incorporated www.luxr.co
  19. 19. Using the Pattern Observe © 2014 Luxr Incorporated www.luxr.co Act Observe
  20. 20. Using the Pattern Observe Establish a baseline © 2014 Luxr Incorporated www.luxr.co Act Observe
  21. 21. Using the Pattern Observe Establish a baseline Act Brainstorm ideas to drive traffic. Try one as an experiment. © 2014 Luxr Incorporated www.luxr.co Observe
  22. 22. Using the Pattern Observe Establish a baseline Act Brainstorm ideas to drive traffic. Try one as an experiment. © 2014 Luxr Incorporated www.luxr.co Observe Track the results
  23. 23. Brainstorm! What can you do to get more customers to come to your store? 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  24. 24. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  25. 25. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  26. 26. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  27. 27. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  28. 28. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  29. 29. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  30. 30. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  31. 31. Brainstorm! Just 4 ideas to increase traffic 2:00 :15 1:45 :30 1:30 1:15 © 2014 Luxr Incorporated www.luxr.co :45 1:00
  32. 32. Choose Two selection criteria: © 2014 Luxr Incorporated www.luxr.co
  33. 33. Choose Two selection criteria: CHOOSE 2: Most likely to generate traffic © 2014 Luxr Incorporated www.luxr.co
  34. 34. Choose Two selection criteria: CHOOSE 2: Most likely to generate traffic CIRCLE 1: Easier to implement © 2014 Luxr Incorporated www.luxr.co
  35. 35. Make it happen Put some time in your schedule to do the work Get started right away © 2014 Luxr Incorporated www.luxr.co
  36. 36. Using the Pattern Observe Establish a baseline Act Brainstorm ideas to drive traffic. Try one as an experiment. © 2014 Luxr Incorporated www.luxr.co Observe Track the results
  37. 37. Conversion Of the people who visit, how many buy? © 2014 Luxr Incorporated www.luxr.co
  38. 38. Conversion Of the people who visit, how many buy? $ MONEY $ $ $ $ MONEY $ MONEY MONEY $ $ $ MONEY MONEY $ $ MONEY © 2014 Luxr Incorporated www.luxr.co $ $ $
  39. 39. Kinds of Conversion Ad views to site visits Site visits to purchases © 2014 Luxr Incorporated www.luxr.co
  40. 40. Conversion Is Key Low conversion suggests fundamental problems: 1 Wrong target market 2 Wrong product for the market 3 Wrong message © 2014 Luxr Incorporated www.luxr.co
  41. 41. Using the Pattern Observe © 2014 Luxr Incorporated www.luxr.co Act Observe
  42. 42. Using the Pattern Observe Establish a baseline © 2014 Luxr Incorporated www.luxr.co Act Observe
  43. 43. Using the Pattern Observe Act Establish a baseline Brainstorm ideas to increase conversion. Try one as an experiment. © 2014 Luxr Incorporated www.luxr.co Observe
  44. 44. Using the Pattern Observe Act Establish a baseline Brainstorm ideas to increase conversion. Try one as an experiment. © 2014 Luxr Incorporated www.luxr.co Observe Track the results
  45. 45. Dollars per Sale Average cart size © 2014 Luxr Incorporated www.luxr.co
  46. 46. It’s hard to get people to visit your store. Make the most of each transaction. © 2014 Luxr Incorporated www.luxr.co
  47. 47. Using the Pattern Observe © 2014 Luxr Incorporated www.luxr.co Act Observe
  48. 48. Using the Pattern Observe Establish a baseline © 2014 Luxr Incorporated www.luxr.co Act Observe
  49. 49. Using the Pattern Observe Act Establish a baseline Brainstorm ideas to increase the dollars per sale. Try one as an experiment. © 2014 Luxr Incorporated www.luxr.co Observe
  50. 50. Using the Pattern Observe Act Establish a baseline Brainstorm ideas to increase the dollars per sale. Try one as an experiment. © 2014 Luxr Incorporated www.luxr.co Observe Track the results
  51. 51. Many other things to measure Repeat sales Customer referrals Page views per visit Item views per visit Abandoned carts © 2014 Luxr Incorporated www.luxr.co
  52. 52. If tracking your metrics doesn’t change your behavior... © 2014 Luxr Incorporated www.luxr.co
  53. 53. If tracking your metrics doesn’t change your behavior... ...then there’s no point in doing it. © 2014 Luxr Incorporated www.luxr.co
  54. 54. Using the Pattern Measure © 2014 Luxr Incorporated www.luxr.co Act Measure Again
  55. 55. Over and Over Measure Act © 2014 Luxr Incorporated www.luxr.co
  56. 56. What’s good? What’s good for you? Set your own goals Do some math © 2014 Luxr Incorporated www.luxr.co
  57. 57. How they play together If 500 people visit my store in a day © 2014 Luxr Incorporated www.luxr.co
  58. 58. How they play together ON ITI S UI Q Aa day If 500 people visit my store in © 2014 Luxr Incorporated www.luxr.co
  59. 59. How they play together ON ITI S UI Q Aa day If 500 people visit my store in 2% make a purchase That’s 10 purchases © 2014 Luxr Incorporated www.luxr.co
  60. 60. How they play together ON ITI S UI Q Aa day If 500 people visit my store in 2% make a purchase That’s 10 purchases © 2014 Luxr Incorporated www.luxr.co ON C RS VE N IO
  61. 61. How they play together ON ITI S UI Q Aa day If 500 people visit my store in 2% make a purchase That’s 10 purchases ON C Average cart size is $40 My gross is $400 © 2014 Luxr Incorporated www.luxr.co RS VE N IO
  62. 62. How they play together ON ITI S UI Q Aa day If 500 people visit my store in 2% make a purchase That’s 10 purchases ON C RS VE N IO ER P RS LA OL D LE SA Average cart size is $40 My gross is $400 © 2014 Luxr Incorporated www.luxr.co
  63. 63. Backtrack to discover what you need If your profit (net of COGS) is 50%, that’s $200 -BUTIf it costs me $300/day to run my business, I know I need to change something © 2014 Luxr Incorporated www.luxr.co
  64. 64. What do I do? Increase Acquisition to 750 visitors -or- Increase Conversion to 3% -or- Increase Dollars Per Sale to $60 © 2014 Luxr Incorporated www.luxr.co
  65. 65. Acquisition: Baseline 500 visitors converting at 2% = 10 purchases 10 purchases x $40 each = $400 gross $400 gross x 50% = Net of $200 © 2014 Luxr Incorporated www.luxr.co
  66. 66. Acquisition: Improved 750 visitors converting at 2% = 15 purchases 15 purchases x $40 each = $600 gross $600 gross x 50% = Net of $300 © 2014 Luxr Incorporated www.luxr.co
  67. 67. Conversion: Baseline 500 visitors converting at 2% = 10 purchases 10 purchases x $40 each = $400 gross $400 gross x 50% = Net of $200 © 2014 Luxr Incorporated www.luxr.co
  68. 68. Conversion: Improved 500 visitors converting at 3% = 15 purchases 15 purchases x $40 each = $600 gross $600 gross x 50% = Net of $300 © 2014 Luxr Incorporated www.luxr.co
  69. 69. Dollars per sale: Baseline 500 visitors converting at 2% = 10 purchases 10 purchases x $40 each = $400 gross $400 gross x 50% = Net of $200 © 2014 Luxr Incorporated www.luxr.co
  70. 70. Dollars per sale: Improved 500 visitors converting at 2% = 10 purchases 10 purchases x $60 each = $600 gross $600 gross x 50% = Net of $300 © 2014 Luxr Incorporated www.luxr.co
  71. 71. This is a way of life that grows your business 750 visitors converting at 3% = 22 purchases 22 purchases x $60 each = $1350 gross $1350 gross x 50% = Net of $675 © 2014 Luxr Incorporated www.luxr.co
  72. 72. Measuring tells you what, but not why. Talk to your customers Listen to your customers Learn from your customers Empathize with your customers © 2014 Luxr Incorporated www.luxr.co
  73. 73. 3 Key Metrics Acquisition Conversion Dollars per sale © 2014 Luxr Incorporated www.luxr.co
  74. 74. Why? Make informed decisions Move the numbers Make more money © 2014 Luxr Incorporated www.luxr.co
  75. 75. Why? Make $informed decisions MONEY $ $ $ $ MONEY $ $ Move the numbers MONEY $ MONEY $ $ MONEY MONEY $ $ MONEY $ $ Make more money © 2014 Luxr Incorporated www.luxr.co
  76. 76. Thank you! Slideshare.net/luxrco @luxrco Metrics For Online Retailers Shopify’s Build a Business Competition © 2014 Luxr Incorporated www.luxr.co
  77. 77. Question and Answer time! © 2014 Luxr Incorporated www.luxr.co

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