Spend 13% To Increase Sales By 30%
Notice the June numbers declined? That's because we took the Learning Search service offline, thinking it wasn't working. Actually, once we did this, we checked the referral URL's and realized we weren't tracking the inbound referrals correctly. Nevertheless, we rode out the month and started advanced search again promptly on July 1.
From July to August, sales increased by over $7,000 from the previous month, a 32% increase. As you can see, sales from search are increasing while the number of search queries remain fairly flat. If I can increase sales by a couple thousand dollars a month by offering visitors a better search. I'm going to do it. It’s still a test in progress, and it hasn't been running long enough for the numbers to level out but it seems to be a good way to go.
When we first signed up with SLI, sales trackable to the Yahoo! Stores provided site search was under $22,282 per month. If I can level out sales from search at the current $26,000 per month, that's a $4,000 increase for a fraction of that cost. And that Cost of Sales is well within the bounds of a profitable investment. Personally, I think we are increasing more than that when you include the lifetime value, or return rate as that must be impacted by the pleasant ordering experience. One of those unknowns at this time. Also, the initial $22,282 could only be tracked after learning search had been running for a month.
The tracking method I'm using in Yahoo! is the "Referers" in your Yahoo! Stats. This will give me the total visits, orders and sales volume. I'm really looking at the increase from one month to the next. As long at the visits stay about the same, which they have been, I can assume the increased sales are because of a happier shopping experience.
|May had similar volume of search queries but 31 more orders resulting in $4,686 additional revenue. If that $4,686 was earned because of better search, those sales cost 17% (Cost of Sales). What are you currently spending to get an order? Would you be willing to spend 17% with NO Labor costs? |
Now when you also factor in an unknown lifetime value rate of a new customer, that increases the revenue earned and therefore lowers cost of sales.
|Again, both months had similar volume of search queries but August had 79 more orders resulting in $7,041 additional revenue. We increased sales by over $7,000 just by offering a better search experience. This represents an 11% cost of sales.|
|Despite fewer search queries, August had 39 more orders resulting in $6,507 additional revenue. The numbers are compelling - a 13% cost of sales and at the same time an increase of the average order by $10?|
In other words, would you spend 13% to increase sales by 30% with no regular labor costs involved? Simply set the system up and let it run. No need to update search when you update products on your web site, constantly manage positions or worry about competitors. It's all done automatically.
Obviously results will vary based upon your company and this article is NOT endorsed or paid for by SLI in any way. Although I have sent them the results.
Note we are NOT using SLI Site Champion (the natural search engine optimization service they offer). That was our reasoning for testing them in the first place, but we have not yet had satisfactory traffic from Google, Yahoo! or other web search engines from this service. When we turned off the service, we accidentally discovered the improved site-search results. Our clients currently only use SLI for site-search.
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Michael Roebuck is General Manager of All Web Promotion, Inc.
All Web Promotion, Inc. is a full service Search Engine Optimization and Yahoo! Store Web Site Design company. You can have an e-commerce web site designed or re-built and optimized for you for much less than you think. Request a free Web Design Quote or visit our site for more of our services and free resources at http://www.allwebpromotion.com.
Additional information, resources and blog posts regarding Yahoo! Stores can be found on his personal web site located at http://www.michaelroebuck.com.