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How Much Should I Spend Per Click? [plus Calculator]

Many businesses struggle with figuring out how much money they should spend on advertising.

Some businesses don’t spend any money on advertising, other businesses spend too much.

Sure, the “free” advertising methods are great and if you’re generating enough money to make you and your business happy – then … good for you! Keep at it!

However, if you want to generate more sales, revenue, and profit … you’ll want to be sure that you’re spending your advertising dollars wisely.

How Much Should You Spend On PPC Advertising?

Believe it or not, figuring out how much money you should spend on your Pay Per Click (PPC) advertising campaigns is very simple.

Unfortunately, too many businesses don’t do the simple math to figure out how much they can and should spend on advertising. So, they wind up spending too much, or running away to cheaper, lower quality, sources of traffic.

You’ll need 3 numbers to calculate your PPC budget:

  • How much gross profit you make per product/service sold ($)
    • Gross Profit = Sale Price – Cost of Good Sold
  • Profit you want to keep per sale ($)
    • This is known as the Operating Profit
    • The amount of money, from each sale, that you want in your pocket
    • Conversely, what amount of gross profit you’re willing to spend on advertising to sell the product/service
    • Note: Don’t forget, operating profit is taxable and may incur other expenses
  • Conversion rate (%)

Bear with me a moment!

I know, those definitions may be a bit confusing at first sight, but after I run through a few examples, you’ll understand.

The PPC Formula

Here’s the formula the calculator follows … you can do your own math if you’d rather!

(Gross Profit – (Gross Profit * (Operating Profit / Gross Profit))) * Conversion Rate

The PPC Calculator

PPC Calculator Examples

Example 1 (Our Product)

We’re an eCommerce store that sells t-shirts.

We buy the t-shirts from the manufacturer for $2 per unit and sell them for $20 to our customers … resulting in an $18 gross profit.

We want to pocket $10 per shirt sold (Operating Profit).

We’ve determined Facebook Advertising traffic to our Sales Page converts at 5%.

Plug the numbers into the calculator …

PPC Example 1

Viola! We can comfortably spend $0.40 per click in order to pocket $10 per sale!

Example 2 (Affiliate Product)

We’re an affiliate for an online course that pays us $50 each time we refer someone to the course (Gross Profit).

We’ve decided we want to pocket at least half of that and spend the other half on advertising. So, $25 in operating profit is our goal.

Over time, we’ve figure out that the course’s sales page converts at around 3%, when traffic is sent via Google Adwords, for a few specific keywords.

Plug the numbers into the calculator …

PPC Example 2

Viola! We can comfortably spend $0.75 per click in order to pocket $25 per sale!

Profit Maximization

When you’re launching PPC campaigns, you may notice some people are paying ridiculous amounts of money per each click.

For example, the product for sale on the sales page is only $49, yet, people are bidding upwards of $15 per click! More than likely, their sales page isn’t converting above 30% to make it profitable.

So, how the heck are they able to bid so much and still turn a profit?!

Simple answer: The have a sales funnel.

That $49 product you see is just the front-end offer (sometimes called a tripwire). It’s what gets people in the door. Once they’re in the door, they go through upsell after upsell … which tend to have high conversion rates, thus making individuals worth way more than the original $49 they spend.

So, the average person may be worth about $200, making the $15 per click more practical, possible, and realistic.

Needless to say, if you find yourself surrounded by very expensive PPC ads, and you can’t compete … you need to spend some time building out and optimizing your sales funnel and sales pipelines.

Of course, if you need help with this … we’re here to help!

Ready For More?

Knowing how much you should spend per click is just one part of the equation.

Knowing how to decrease the cost and/or increase the profit is the other part …

The Sales Funnel Training Vault will teach you all the parts!

How Much Should I Spend Per Click? [plus Calculator]2016-11-17T17:29:52+00:00

The Powerful Sales Funnel – Explained

No matter what you call them – sales funnels, marketing funnels, conversion funnels, purchase funnels, customer funnels, etc. – one thing remains true, you need one!

In this post, I will walk you through a few simple models to demonstrate the power of a sales funnel. By the end, you’ll truly grasp the concept in all its glory.

The Scenario

We’re an online only (eCommerce, B2C) electronic cigarette business.

Note: Whether you know anything about Ecigs or not … it doesn't matter, I'm simply using it to illustrate the point … which you will still understand. (I know very little about eCigs myself)

Core Product

The core product is the main reason anyone visits our store. Ours is this …

ecig

Basic Ecig ($50)

Upsell of Core Product

This is the more “prestigious” version of our core product and what we try to get people to buy as opposed to what they originally visited our store for (core product).

It costs a little more, but it's better!

Upsell

Advanced Ecig ($75)

Complementary Products

These are products that complement the core product. They’re not really useful on their own; however, they take the core product to the next level or are used with the core product.

complementary products

Fluids ($20)

Battery ($15)

Battery ($15)

Car Charger ($10)

Car Charger ($10)

Quick Recap

The point of a sales funnel is to bring people into your business, “funnel” them down until they make a purchase, and then keep that customer happy for years to come (retention).

sales funnel updated

No Sales Funnel

Although the sales funnel is a general representation for business, most businesses don't “purposefully” operate in this fashion. Instead they focus on the immediate – sell, sell, sell!

Needless to say, they’re missing out on a tremendous amount of conversions, customer loyalty, and revenue.

Here’s what our business looks like without a purposeful sales funnel in place:

No Funnel

So, assuming 1,000 people visit our store, and we have a 10% conversion rate on sales … we can expect 100 purchases a month or $5,000 in revenue a month … which means each visitor to our store is worth about $5.

Not too bad.

But, think about it … 90% of the people who visit our store leave and never come back! Certainly there is something we can do about this.

Sales Funnel (Convert Leads To Customers)

Enter the sales funnel!

With Funnel

By adding an email opt-in with a lead magnet to our site, we're able to build a better relationship with our leads and increase our conversion rate to 20%!

Sales Funnel (Maximize Customer Value [Retention])

Now, let's take it one step further by continuing to engage with our paying customers:

Funnel with pipeline

BOOM!

By implementing a “purposeful” sales funnel, we're able to bring our visitor's average worth up from $5 to $14! That's an increase of 280%!!

Let’s quickly walk through it.

Thanks to our sales funnel (the part that converts leads into customers) we’re able to boost our conversion rate from 10% to 20%. After the lead becomes a paying customer and we begin to focus on retention, we're able to recommend complementary products to our customer.

Sure, not every complementary product (cross-sale) will convert, which is why we have different conversion rates. Some will convert, which is the key.

Overall, the retention phase adds another $4 (or 40%) to our customer’s lifetime value … and this can all be handled automatically, through email marketing!

Apply To Brick And Mortar

I know what you’re thinking. This whole concept sounds all well and good with an online store … but, what about a physical, brick and mortar store?

I’ll let you in on a little secret … treat it the same way!

Instead of a landing page … you have a store. People “land” in your store.

Instead of a lead magnet … you can offer people a chance to enter a raffle for a $100 gift card … in exchange for their email address.

When someone makes a purchase … you manually tag that individual in your autoresponder tool.

Sure, some stuff will be more manual … but, it’s not at all hard. You can easily see the value between having a sales funnel in place and not.

The time invested in setting up a little contest (lead magnet), and manually entering people’s information is well worth it!

Get Started!

I'm done trying to convince you of the power of having a sales funnel in place. If you're still not convinced … I can't help you.

If you need help … grab our top converting email series! It will get you headed in the right direction in no time!

The Powerful Sales Funnel – Explained2016-10-14T18:29:40+00:00

How We Transitioned an eBay Store to a Website (and how you can too!)

We recently took on a client that wanted to transition their robust eBay store over to their own website.

While this is not the first eCommerce store we’ve ever built – it is the first one that we transitioned from eBay, so we learned a few things that we’d like to share with you (and for us to refer back to should we receive another job like this!)

Before and After

I’ll start off describing the before and after, and then we’ll get into the details on how we made it happen!

The eBay Store

Below you’ll see a picture of the eBay store our client wanted transferred to her own website – and the eBay store still exist if you want to check it out

[click here to go to the eBay store].

The Wild Petunia on eBay

As you can see from the picture – it's a collectibles store with a lot of cool looking stuff!

As you can also tell – there are a lot of pictures and categories that needed to be transitioned over as well.

The Old Website

Our client already had a website in place; however, it was in need of a face lift, plus it did not have any eCommerce functionality.

Here’s what the website used to look like:

The Old Wild Petunia

As you can see, it’s kind of dark  – our client is a happy person, but you wouldn't be able to tell from this dark theme. Also, some formatting was a little funky.

Yet, the biggest problem was that it was not mobile friendly (responsive).

So, it was going to have to change.

The New Website

Below is a picture of the new and improved website – complete with eCommerce functionality! If you would like to see the website in person go to https://thewildpetunia.com!

The New Wild Petunia

As you can tell – a LOT has changed … and I’ll be getting into those changes … right, about, now!

What Changed?

Before I get into what all we used and why – let me start off by stating what did not change –

Our client was running WordPress – which is what we use, so we kept it in place.

Our client had a few posts and pages already in place – we kept the content; however, we cleaned up some of the formatting.

Everything else – was changed.

Web Host

Our client was originally hosted on a shared hosting account – which, given the sheer volume of products and images – would probably not have cut it.

She kept the same host (because they're good and they're who we actually recommend), but she upgraded her hosting package to a more robust one that could better handle running her store.

She hosts with StableHost and opted for the En-Basic Plan (Note: use coupon code CrazyEyeMarketing for 40% off).

SSL

Our client wanted to have the option to accept credit cards directly on her site instead of having her customers have to checkout through PayPal.

We recommended Stripe to her – which is a fantastic credit card processing company, but – it does require that the website have SSL – so, she had to add that to her hosting package.

WordPress Setup

Theme

We changed her theme over to the very popular Avada Theme by Theme-Fusion.

What's New?

This part is going to be fun, because about 90% of it is new!

eCommerce Setup

Since our client was running WordPress, we opted to use the best eCommerce plugin for it – which is WooCommerce.

The best part is – it's free! (kinda)

WooCommerce, on it's own, is fairly stripped down.

Sure, it can host a store; however, you'll probably want a few more features that handle things like shipping, credit card handling, taxes, display, and more.

And in order to make it do all of those extra things – you'll wind up forking over a little bit of cash; HOWEVER, in comparison to an eCommerce store that's hosted by a 3rd party that charges you on a monthly basis (like Shopify) – a few extra dollars up front winds up being a much better deal.

The Additional WooCommerce Plugins We Added

Some of these were/are free, others were/are not:

  • Offers for WooCommerce – gives people the option to offer a price other than the one that is listed. Kind of like making a bid on eBay
  • Stripe for WooCommerce – allows people to pay with credit cards directly on the site
  • WooCommerce USPS Shipping – interacts with the USPS website in order to automatically calculate shipping costs based on weight, size, address, and more
  • Import from eBay to WooCommerce – I will talk more about in the “How'd We Move Everything Over” portion of this post
  • WooChimp – I will talk more about in the Email Automation portion of this post

How'd We Move Everything Over?

Our client had over 50 categories and 1,000 products listed on eBay.

I hoped, and prayed, that there was a plugin that was going to be able to help transition everything over from eBay to her site – and thankfully, there was!

Import from eBay to WooCommerce is well worth the investment for anyone looking to make the switch.

While it did take about 14 hours for it to pull everything over – it was much faster than a human could ever do it.

It pulls over all of the categories, products, images, descriptions, measurements, and a few other things.

So, that's how we moved an entire eBay store over to a WooCommerce store.

Email Automation

Email is everything.

It's the most direct way to interact with your customers.

Not to mention, our client already had an email list of over 600 paying customers already!

Sure, there are people that say “email marketing is dead!” – and sure, it's not as effective as it was way back in 2005; however, when you compare it to ANY other form of advertisement – it can't be beat.

In knowing this, our client knew she wanted to be on top of her email marketing game – which is why we added the WooChimp plugin.

This plugin connects her WooCommerce store to MailChimp (our favorite email list service).

So, whenever she has a new paying customer – MailChimp knows and can send an email, automatically, thanking them for their purchase – while recommending complementary products!

It also tells MailChimp important details like – what the individual purchased, how much it cost, when the purchase was made, etc.

Everything you'd ever want to know.

Other Email Automation

So, I've already discussed the portion where if someone purchases a product – but, what about everyone else?

As you probably saw from the picture of the new site – we've added an opt-in form to the sidebar that offers an extra 10% off any order.

Sidebar Opt-in

There's also an “exit intent” popup that makes the same offer.

Exit Intent Opt-In

Now, when people enter their email address, they're automatically sent a 10% off coupon as well as a follow up series that converts them into paying customers!

We generated the two opt-in forms with a plugin called OptinMonster – which is an incredibly awesome plugin that we highly recommend!

Other Plugins

Besides all of the plugins that we installed to make WooCommerce and email automation function the way our client wanted – we installed a few other plugins to help tie everything together.

  • All In One SEO Pack – helps make all of the pages, posts, and product listings search engine friendly
  • EWWW Image Optimizer – our client has well over 10,000 images … which is a TON! Needless to say, we still wanted her website to be as quick as a whip and having uncompressed images would have bogged it down. EWWW Image Optimizer helps by automatically optimizing images as their uploaded – making the file size smaller while maintaining the image size.
  • Gravity Forms – the BEST forms plugin for WordPress. It's running on her Contact Us page as well as a survey page that is sent to paying customers

Conclusion

While there are certainly benefits to having a store on eBay – mainly the fact that people can easily find you via eBay's search function – there are also many disadvantages – look, feel, you don't “own” your store, eBay fees, hard to build a following, etc.

It's always nicer to have your own place compared to renting or borrowing.

And as you can see, it's not difficult to move everything from an eBay store to a WooCommerce store – it just takes a few plugins and a little bit of time!

How We Transitioned an eBay Store to a Website (and how you can too!)2016-10-14T18:29:42+00:00

Website Evaluation: Stauer.com

This is the first Website Evaluation post for Crazy Eye Marketing!

We take a look at Stauer.com – which is an eCommerce website that sells jewelry.

The point of this evaluation is to give tell the company exactly what I would do if I was “king for the day” and to provide them with several actionable steps in order to optimize their website for many different metrics (conversions, click throughs, time on page, number of pages viewed, etc.)

You’re Bleeding

Intense, I know.

Your mobile website, which, should be responsive and not its own separate entity (but, that’s a whole other issue), has a HUGE flaw … the opt-in form does not work.

Stauer Mobile Optin

The subscribe button isn't a button! It doesn't do anything when clicked!

You are literally taking away people’s ability to give you their precious contact information. And contact information is money.

You’re also aggravating these potential customers by your site not functioning properly. They want their coupon, yet, they cannot get it.

I’d address this issue immediately.

Besides, how are you going to measure anything when there is nothing to measure because your site doesn't work?

Your Homepage

Stauer Homepage

Visually, it’s OK (it looks a little dated). Of course, I’d test different colors, pictures, link text, etc. However, without seeing any data, it’s hard to tell how well it’s performing – which pictures/links are drawing the most clicks.

The Main Issue With The Homepage

The main issue that I can almost guarantee is hindering your conversion rates is the location of the opt-in form – which is located all the way in the footer.

Stauer Optin

Do you not want people to see this and give you their contact information? Because that’s the way it appears.

An opt-in form should be front and center, not shoved in the bottom corner.

Your Opt-In Form

Well, I reckon I’ll address the opt-in form now.

I don’t like it one bit.

The Offer Is Not Good

First off, the offer only appeals to people who are about to make a purchase. What about the people that are just browsing? They’re not going to give you their contact information for a coupon they may never use.

Secondly, you’re offering a $20 coupon; however, most items “come with” a massive coupon …

Diamond Ring - circle

$20 is chump change compared to the $200 I’ll save instantly, without giving away my contact information.

You need to offer something so delicious that everyone from a random window shopper to a jewelry connoisseur is dying to give you their contact information in exchange for a taste.

That $20 coupon will not cut it.

Worst Call-To-Action (CTA) To Ever Exist

The current CTA is the worst CTA to ever exist, ever.

If you’re not sure what I’m referring to – it’s that lovely button that says “Subscribe”. Don’t ya just want to put your email in there and press the button?!

I’m guessing not.

It needs to be “fun” to click, and it needs to be in line with the offer (Give Me My Coupon Now!).

Your Success Page

Stauer Success Page

Now I see that the coupon is good on orders of $100 or more and cannot be combined with other codes or promotions – thus, rendering this coupon as useless.

Besides fixing the mobile opt-in form – please, please, please change your offer. All you’re doing with this is aggravating potential customers.

Tracking

It appears that you’re using Adobe Marketing Cloud (at least parts of it), and I can’t quite tell if you’re using it to run Google Analytics, Facebook Conversion Tracking, Facebook Exchange, etc. – as shown within builtwith, but it appears you’re tracking things.

At least I hope you’re tracking things.

Things like opt-ins, click-through-rates (CTR), conversion rates, open rates, social engagements, etc.

Hopefully you’re forming hypotheses and testing them, because Adobe Marketing Cloud can do a lot of stuff – and it’s expensive, so it should be used to constantly run tests – which is what I would be doing tons of.

Emails

I am about to give you some props!

The second I submitted my contact information, you delivered my coupon – as promised!

First email from Stauer

Regardless of whether the coupon is actually worth anything or not, it was instantly delivered which, a potential customer, would be very appreciative of.

Note: Normally, I would wait until I received several more emails from you before submitting this report in order to better analyze how you build a relationship and close a sale; however, since I'm only “king for the day” – I will go with what I currently have.

As king, I would keep a close eye on how well your emails perform. I would examine things like open rates, CTRs, and engagements. I would split test subject lines, content, images, etc. just like the rest of the web site.

I would also setup different email series for different customers based on what they’ve purchased and/or looked at and/or their buying habits. For example, if someone buys a certain watch, I would have an email automatically go to that person recommending a matching set of earrings. Thus, increasing sales.

Intermission

I am going to hit on a few more topics very briefly because I’m not sure if you’re enjoying this style of post or not, because if not, I don’t want to waste any more of your time.

However, if you would like to discuss more – let me know in the comments below!

Social Media

First off, where is your Twitter account? That is THE most important social media account for businesses. Twitter is one giant conversation that allows you to reach down to your customers and potential customers, and gives them the opportunity to reach you.

Facebook, you have a lot of likes 16,404; however, very little engagement. Some posts have one like. Why is that? My guess is because you’re using Facebook as a giant ad board, and people don’t want to look at ads; so, I would test the heck out of your Facebook posts and the content you’re sharing. Maybe a contest to re-invigorate interest?

Your Pinterest is not very active – the most recent pin I could find was over a year old – why is that? Are you not adding new products? Could you not promote your products in another light? You have great pictures and they need to be seen!

Your YouTube channel – I’m going to keep this short – it needs to be resuscitated.

Instagram – why aren’t you on here? Imagine getting some celebrities to take photos with your jewelry and sharing it with their followers – cha-ching!

There are so many variables you can test on social media, but it looks like you’re letting things fall apart.

Advertising

While I was browsing CNN, I was retargeted – nice!

Stauer Ad

It was good to see your ad follow me around.

As king, I would test hundreds of ads, traffic sources, landing pages, etc.

eCommerce

Of course, there is the whole eCommerce portion – in which I would examine cart abandonment, up-sells, cross-sells, down-sells, etc.

I would test images, button locations, titles, links, etc.

Everything can be tested.

The End.

While I made a few assumptions in this report – If I were “king for a day” – I would take a very objective approach to improving your website – numbers don’t lie.

What did you think of this style of post? Was it helpful to you? Were you able to glean any insights? Leave a comment below!

 

Website Evaluation: Stauer.com2016-10-14T18:29:42+00:00