What You MUST Understand About Your Web Numbers
Two years ago, when I first started selling online, I focused on doing what I did best: generating useful content that people would want to pay for. But I quickly learned that selling a product online required me to have to learn about …
…my Web statistics.
“Yuck! Why should I have to do this?” I thought. “I’m not a numbers person. Such small details! I want to spend time on big ideas.”
Then after a few months of poor sales, I realized I needed to learn more about my numbers so I could learn how to improve my results. (You can’t improve something that you can’t measure.) After getting acquainted with my statistics, I not only realized that this information would help me immensely, but I was relieved that it wasn’t so hard after all. It was just unfamiliar.
There are four types of basic “Web numbers” I want you to understand. Don’t worry – if I can handle this, you can too!
HOW MANY SALES are you making? This should be easy to determine on your end.
2. Unique Visitors
HOW MANY PEOPLE are visiting your site? To know this, you’ll need to know your number of unique visitors.
Do NOT confuse unique visitors with “hits,” which refers to number of graphics downloaded. (For example, if you have a Web page with 10 graphics, 10 hits would equal one visitor.)
Your Web host may already provide some stats you can access, but many of these programs are hard to understand and only track hits. If this is the case, it’s well worth it to use a low-cost outside tracking service such as WebSTAT (www.WebStat.com) that will show you your number of unique visitors.
3. Sales Conversion Rate
Here’s where we start with some math. Take your number of sales during a given time, and divide it by your number of visitors during that time. We’ll walk through this in a minute.
4. Value per Visitor
This tells you how much each visitor is worth to you. It’s basically your selling price times your conversion rate.
Let’s Walk Through It Together
Say Suzy Q runs a site that sells a special report on how to teach your dog to do a back flip. The report sells for $20.
Last month she had 50 online sales. Her Web stats show that during that month she had 1,500 unique visitors.
First let’s figure her sales conversion rate – sales divided by visitors.
50 / 1,500 = .0333. We’ll round it down to .03. (If we’re talking about percentages, that’s about 3%. Or 3 sales for each 100 visitors.)
Now, let’s determine her value per visitor.
The report sells for $20, and we now know that her sales conversion rate is .03. So .03 x $20 = $.60.
That means each visitor is worth 60 cents to Suzy, whether they buy or not.
(Here’s a longer way of doing this but it may make more sense to you: Based on Suzy’s current conversion rate, she makes an average of 3 sales per 100 visitors. 3 x $20 = $60. So for every 100 visitors she makes an average of $60. $60 / 100 visitors = $0.60 per visitor.)
This number tells Suzy how much it’s worth spending to get a visitor to her site. For example, if she decides to advertise on a pay-per-click search engine, she knows that $0.60 is the maximum she’d want to bid. (For a beginner’s guide to pay-per-click search engines, see my article at www.ezine-queen.com/payclick.htm)
FR*EE Calculations Template
Would you like a free fill-in-the-blanks template to help you make the calculations above? I’ve put one together for you! Send a blank e-mail to firstname.lastname@example.org and you’ll receive it automatically.
What to DO With Your Numbers
First of all, look at your unique visitors. If your numbers aren’t as high as you’d like, work on attracting more prospects to your site via your e-zine, search engine listings, advertisements, articles, etc.
Then look at your sales conversion rate. If it’s around 2-3%, you’re doing pretty well for online sales, according to what many Internet experts share. Some months my conversion rate has been as high as 6%, but it typically hovers around 4%. Some marketers with hot products have reported conversion rates up to 10 or 20%. (Hey, it gives us something to shoot for!)
Aim to continually improve your sales copy and your sales offer to boost your results. Keep a log of what changes you make and when you make them so you can see which factors help or hinder your sales. (There’s a place for these notes in that template I created for you.)
Don’t Sweat It
This may seem foreign to you right now, but once it becomes familiar, you’ll actually have fun with it. And there’s more where this came from, once you’re ready!
(c) 2003 Alexandria K. Brown
Alexandria K. Brown, “The E-zine Queen,” is author of the award-winning manual, “Boost Business With Your Own E-zine” and the publisher of the e-zine, “Publish for Profits.” To learn more about her book and FREE tips, teleclasses, and resources, visit http://www.EzineQueen.com.