What Drives the Sales (Part I)
I'm going to write down a small summary of the factors that drive the sales and increase the profits. It's mostly a reminder to myself and I'm not jealous of sharing the information with you too. I hope it helps to improve the sales of those reading it.
I was using data from different retailers and separated the sales results by following: 1) Periods where subscriber was contacted 2) Periods of discount or special offer 3) Periods where product images were shown to customers via advertising 4) Combination of discount and product images. Those periods were measured againts yearly averages of overall sales.
According to the data, contacting the subscriber didn't have that big of a difference to the sales. It resulted with an average boost of 5% to the sales. So, getting in touch with your subscriber has to have a pretty good reason to push the sales more than some percentage points.
The same goes with the discounts. As special offers and discounts are becoming a common feature of everyday marketing it's impact and results are getting successively smaller. In my analysis the effect of discount to the sales was only 7% of sales growth.
Showing images of products to customers is nothing new. It should be considered a standard. But some retailers still don't understand the value of it. As a customer you obviously want to see the product.
And the other thing is the price: it's a big dissapointment to open an offer only to find out that there is no price data to be seen. Dissapointment is even greater while showing up at the store and discovering that the price is from another league of what you were considering of spending.
As I was not analysing sales change from the price info perspective I can only point to the difference between showing product images againts not doing it. The differnece of sales was around 15%. So, showing product images on ads had better results to the sales growth than contacting subscriber or offering a discount.
Product images + discount
The final indicator that I measured was combining the product images with discount offer. As you might already expect the results were better than those of above. Showing product images and offering a discount at the same time resulted in 24% of sales growth.
The next step
Maybe you already thought of it yourself as it seems pretty obvious that the next thing to do would be to compare average yearly sales againts showing product images + price + offering a discount. Unforunately I don't have that kind of data right now to make that comparison.
I'm trying to collect more data and hopefully set up my own store to test out the difference between all of those mentioned above plus coming up with some extra stuff later.
It should be standard
Everything that I wrote in this post is pretty basic knowledge and practice. Still it's good to know that these steps above more or less matter. Product images, price data, subscriber connection and regular discounts should be a standard anyway. And it's exactly what my analysis and comparison confirms.
Last update: 2018-05-02 (Y,M,D)
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