… or: Simple Math to make you want to market

This article is a continuation of our series on using the Marketing Funnel to determine where you should be spending your time each week in order to grow your online business. For the first article, check out: “Using the marketing Calculator.”

As a refresher, here’s the simple equation we’ve been using as the basis for growing your web site:

1,000 site visitors per month = 100 orders per month

10% conversion rate

We talked about increasing the conversion rate (and will dive into that in detail in future articles), but what other levers do we have to increase your online revenue? What about the numbers you don’t see in our equation?

In this article we’ll discuss the marketing funnel before you get site visitors and increasing the dollars in each order.

Getting more site visitors

Option 1: Increase the % of your fans who actually click through

Since this is all about math, think about the numbers that come before our simple equation. Your site visits are driven by your efforts to convince people to come to your site. We’ve already alluded to getting more people there, and so it makes sense that you would want to find ways to convince a higher % of those potential visitors to actually make the leap and click through.

Currently we have 1,000 site visitors per month, so let’s say they represent 50% of people you’ve reached this month. (That’s pretty good, btw.) So, you’ve reached 2,000 people. 

If you can increase the click-throughs to your site to say 60%, you’d have 1,200 site visitors. 

Original: 

2,000 people reached X 50% click-through = 1,000 site visitors

Better click-throughs:

2,000 people reached X 60% click-through = 1,200 site visitors

Getting a higher click-through rate isn’t as hard as you might think. You could do this through an enticing offer, promising (and delivering) a rich experience on your site, or simply making it easy for people click-through. (You’d be amazed at what a strong call-to-action message will do for your click-through rate.)

Option 2: Finding a bigger pool of potential site visitors

Another tactic is to go after a larger pool of potential visitors. In this case your click-through rate might actually go down, but the volume would go up. If you reached 5,000 people, then even if your site visit rate drops to 40%, you’re still getting double the people to your site.

Original: 

2,000 people reached X 50% click-through = 1,000 site visitors

Bigger pool:

5,000 people reach X 40% click-through = 2,000 site visitors.

How to reach more people? This is all about “pounding the digital pavement” … utilizing every available channel, from myriad social media platforms, to organic search, to email and even to promoting sign-ups and visits at your physical events. This is the part where you have to hustle a bit!

And, of course, I recommend going after both options 1 and 2. Having more potential customers plus a better chance of them getting to your site? That’s marketing gold, right there.

Average order value: Getting more for each order

Now, it’s time to turn our attention to what happens during the order process.

In our example, you were getting 100 orders per month. But, how much are those orders worth? The average order value is the sum total of your purchases divided by the number of purchases.

So, if you made $1,000 on 100 orders, then your Average Order Value (AOV) is $10.

You want to make more money next month? Find out how to increase your AOV to $15. That would bring your monthly revenue to $1,500, giving you an extra 500 bucks. Not bad, right?

Original:

100 orders @ $10 each = $1,000

Higher AOV:

100 orders @ $15 each = $1,500

So, what could increase your average order?

• Promoting complementary or accessory items (Get the hat & the tee shirt from this year’s festival)

• BOGO promotion (Buy the hat, get the tee-shirt half-off)

• Bulk buy: Get a season’s pass for 10% off.

It’s not just about having the additional products/services to sell, it’s how you serve them. Do it in the cart, do it at check-out, but most importantly: MAKE IT EASY (and cheap, helps, too.) An upsell or cross-sell that’s less than $10 is a sure-fire way to go. After $10 people really start to think about it.

These ideas, and others like them, are just brain-starters. What else can you do to increase the number of people flowing through the marketing funnel and bring in more dollars? To check your math, don’t forget to use my easy marketing calculator.

by Scott Atkinson, March 27, 2020

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