There are certain marketing metrics you need to follow in your business to ensure continued growth and profitability. It is within every business persons reach to do this. Following the numbers game will dramatically improve your bottom line.
Here are the seven numbers you should be watching:
- Foot traffic.
- Opt ins.
- Average item sale value.
- No. items in the basket.
- No. of times the customer returns.
- Gross profit.
A 10% increase in foot traffic followed by a 10% increase in opt ins, followed by a 10% increase in conversions, followed by a 10% increase in the average sale value, followed by an extra 10% no items in the basket, followed by a 10% increase in the number of times your customers return, followed by a 10% increase in gross profit will result in a 97% increase in your profits.
If this interests you then read on...
So what is a ten % increase in foot traffic?
Well if you have 10 clients walking in your door each day, then you need 11. If you have 100 clients walking in your door each day you need 110. So how many people visited you this month?
So what is a 10% increase in Opt-ins?
Well let’s define an opt in first. An opt in is when a potential client takes a demonstrable action towards a sale. In a clothing store they may try on the shirt or jacket, In the service industry they may ask for a quote. In the restaurant trade they may ask for a menu or request a price or description of the item. In the online environment they may sign up for a free give away on your website. So if you have 20 people trying on an article of clothing each day, you need 22 to have affected a 10% increase. Not a big ask. So how many new opt ins did you get this month?
So what is a 10% increase in conversions?
Conversions are when the plastic hits the card machine, when the cash hits the till or when the deposit is made in your bank account. If out of the 20 people who opt in with you each day, ten normally result in a sale then your target is to get 11 to convert. So how many new clients did you get this month?
So what is a ten percent increase in average item sale value?
Lets take a mans belt as an example. You can get a cheap one for R50. However a genuine Levy belt will cost upwards of R400. Both hold your pants up. The perception of value is better with the Levi product. So within your business is there an opportunity to upset to a deluxe item, one with a perceived higher value. Your target is to get enough people to take the better option to increase your average item value by 10%. In the restaurant game that may be selling the 400g rump instead of the 200g sirloin.
So what is a 10% increase in number of items per sale?
What product or service can you add to the clients basket of goods he gets from you? Can you interest them in an add on service, a warranty, extra chips or a cool drink in addition. How often have you stood at a fast food outlet and being asked if you want to upsize your order, or would you like that with a jumbo coke or a side salad. A 10% increase is not difficult to achieve.
So what is a ten percent in the number of times a client comes to you business?
If he shops once a month then you need them to come twice in one month of the year. If he dines with you five times a month then you need to get him to dine with 11 times in two months. If he has coffee in your coffee shop every weekday then you have to entice him to come twice on Saturdays.
So what is a 10% increase in gross profit?
Gross profit is defined as your turnover divided by your cost of sales and is often expressed as a percentage. There are many ways to increase your gross profit. You can reduce shrinkage or stock losses due to damage or theft, you can negotiate better supplier prices or you can raise selected prices in your store. Most people can achieve this by using a combination of the three.
So, by watching the numbers and focussing on these areas of your business you can double your profit if you increase each of the metrics by just ten percent.
But by now you’re raising a hundred different reasons why this can’t be achieved. The reason you don’t play the numbers game is that you don’t know the numbers.
But what if I can show you how to get these numbers, with very little effort and that you have the ability to turn your business around?
Pop me an email if you are interested.