Regardless of how long you work in e-commerce, I want to know what is the value of the business in which you invest time and soul. Both beginners and experienced entrepreneurs need a tool in order to evaluate the effectiveness of the entire business project.
Why make an assessment?
There are many different strategies that make it possible to evaluate an online business. You can work and develop the project further only when you operate with exact numbers. Otherwise, the whole enterprise is more like wandering in a dark room, and not on the road to success and prosperity. In this article, we will look at exactly which indicators and tactics you can use to determine and increase the value of your online store.
Assessing the value of a business is extremely relevant also if you are thinking about selling a commercial project on the Internet. You can, of course, not bother and, for example, request a free assessment from the leading international mergers and acquisitions consulting firm FE International. However, it is better to understand the basics of conducting this process in order to avoid underestimating the selling price. By the way, the assessment will also help to understand what actions need to be done to increase the value and maximize your profit from the transaction.
Work on increasing key parameters
If you want to increase the value of your online store, you must definitely pay attention to several important indicators. To achieve success, try not only to count each of them, but also to think of ways and actions for their further increase. For example, you can set yourself certain goals for the growth of each of them in the near future.
Indicator # 1. Website Traffic
It includes an understanding of the number of visitors, the frequency of return visits, geographic spread, and much more. Everything is extremely simple here: the more traffic on your resource, the higher the value of your online store.
As a tool for tracking visitors, you can use, for example, Google Analytics or statistics on Yandex. When you learn about who, when and from where visits your site, a unique opportunity arises to predict and satisfy customer needs. And this will lead to an increase in the number of orders and growth in profits.
Among the possible channels of communication with your client, you can consider the organization of mailings by e-mail. Inform about your news and promotions, and this will be an additional reason for the buyer to make another profitable purchase in your store.
Indicator No. 2. Average order amount
The calculation of this metric is the arithmetic average of orders (the sum of all the orders of your store must be divided by their number). Compared to traffic, this data will help you better understand what type of customers your customers are.
Among the methods for increasing the average order indicator may be the provision of additional services for free or at a discount if certain conditions are met.
For example, “place an order from 1,000 rubles and get delivery as a gift” or “buy 2 things and get the 3rd with a 30% discount." Also, offers to buy goods with the maximum discount at the last stage when placing an order work well.
Additionally, you should also refer to the reorder option. The more regular customers you have, the greater their loyalty. This means that customers are willing to buy from you not only once, but also continuously for a long time.
Indicator No. 3.Revenue per customer
To evaluate digital commercial projects with a history, it is important to understand the quality of long-term customer relationships. This can be done based on the value of long-term interaction, which shows how much income you earn on average per client.
This is where the opportunity arises to appreciate real long-term loyalty. You can calculate it yourself by choosing regular customers, summing up all their purchases and dividing the amount obtained by the number of such customers. Thus, it turns out the value of how much each client spent on your resource during use.
Post your offer on Google or Yandex
The use of contextual advertising in large search engines can also be a good indicator when evaluating the value of an online store. In a sense, the availability of company information on a key request indicates a high status and a strong financial position. A recommendation from a major search engine (even if it's just an ad) subconsciously increases confidence in your site and your products.
Regardless of whether you get a lot of sales or just carry out the positioning of the company, the perceived value of the online store immediately increases.
Create a complete offer
Creating a packaged selling solution is a great way to add value to your online store. If in addition to the site you offer additional assets, together with such an offer creates a much higher perceived value for the potential buyer. Among these additional assets, in addition, there may be: a brand, a customer base, a catalog of suppliers, etc.
Additional value-adding assets
- Brand - sometimes it is called a private label. If it is untwisted, then the cost can increase significantly. In fact, this is the face of the business, and long-term customers are loyal to him. The brand includes logos, promotional materials, website design, brand style guidelines (brand book), etc.
- Social Media Accounts. Despite the fact that they can be reoriented, in practice this leads to a loss of audience, so it is not effective. Usually they are included in the transaction to increase the total selling price. Depending on the number of subscribers and their activity, this asset can also cost a significant amount.
- Personal support - offer your knowledge and experience in a specific professional field to work with clients of the new owner. Payment in this case can be set for a certain period of time and be included in the general package.
- Inventory - physical or digital, which is possible and appropriate to transfer along with the online store.
Despite all of the above, a universal recipe for evaluating an online business does not exist. Do not forget about simple things. Focus on providing the best products and services customers need. Take care of them with excellent service and do not neglect the feedback. Always be in contact with the target audience.
Make high-quality and demanded service, and you will be on the way to maximize the value of your online store.
