School is officially in session, and Professor Ben is taking you through the basics of your online revenue. Learn the essentials of calculating your revenue online, and keep your eyes peeled for more videos from noissue University (not an Accredited University, in fact, it doesn't really exist)!
There are three key factors that play into your ecommerce revenue. All of which you can track through either your site or through Google Analytics. For ecommerce store owners, Google Analytics is your best friend.
First up is your traffic, which is how many people are actually coming to your site. We cover site traffic a bit more in another of our videos, but the basic gist is that more traffic is always good. However, you want to ensure that you're getting relevant traffic, and not just random traffic. People who are interested are always better for your bottom line than people who have no idea why they're on your site to begin with.
Second is your conversion rate. This is the percentage of people who 'convert' when they visit your site. An ecommerce conversion signals the completion of an event, usually a sale or purchase, and is a key metric that you want users to take when they visit your site. For most ecommerce stores, conversion rates fall in the range of 2-3%. That means for every 1,000 people on your site, 20-30 of them will end up purchasing something.
Finally, there's average order value. Average order value refers to the average total dollar amount of items in your customers' cart when they checkout. If you have two customers, Gerald and Sharlene, and Gerald buys two pairs of shorts worth $100 and Sharlene buys a shirt worth $50, your average order value is $75.
When you multiply the three together, you get your overall revenue. It's important to pay attention to those three factors, because increasing any one of them (provided the other two stay the same) can have a drastic impact on your ecommerce revenue.
With that, you should have the tools you need to take a look at the basic components of your ecommerce revenue. We'll have more videos on how to improve each element so don't forget to subscribe! Check out some shots from the shoot as well.