What factors should I consider in deciding which product size to first launch?

2020-08-09T15:25:49-06:00By |Categories: Product Development|Tags: , , , , , , , , , |

This is a Quora question I was asked to answer. You are going to generally size based on the competing products already available to consumers. The reason is because that is what consumers expect and in many cases, supply chain, warehousing, e-commerce operations and store shelves are already optimized for the sizing sold. If you [...]

How is e-commerce viable for low value products?

2020-07-25T10:04:03-06:00By |Categories: Finance|Tags: , , , , , |

This is a Quora question I was asked.  My answer as follows. That depends. You really need to maximize your average order value (AOV), ideally above $75 in order to make the e-commerce operation pay for itself and earn a profit. If you can do that, then yes. Subscription orders and repeat customers will help [...]

How can I get better margins for my products in my e-commerce business?

2020-06-17T12:25:26-06:00By |Categories: Finance|Tags: , , , , , , , , , , |

This is a Quora question I was asked to answer. By margins I am going to assume net margin, which is net income. Think of the flow of money in a consumer goods business as a way to help you improve margins. I have a spreadsheet model accompanying this graphic here. In the [...]

Simple model to determine success of product sampling in e-commerce

2020-06-10T07:34:04-06:00By |Categories: Marketing|Tags: , , , , , |

Here is a simple model to determine success of product sampling in e-commerce. I was presented with some quick  performance metrics on an e-commerce product sampling campaign for a supplement startup, which included the cost of the sample plus shipping ($.70), the average order value ($39) and the response rate at 20%. That got my [...]

I’m considering on starting a drop ship ecommerce online site. What are the best products to offer?

2019-12-22T15:16:17-07:00By |Categories: Product Development|Tags: , , , , , , , |

This is a Quora question I was asked to answer.  My response is below. There are a ton of free resources online about drop ship ecommerce. One is Drop Ship Lifestyle. Finding the best products is the million dollar question. But you find these products using many tools and processes to help, one of [...]

What are some barriers of entry to running a successful eCommerce business?

2019-12-28T14:26:27-07:00By |Categories: Finance|Tags: , , , |

This is a Quora question I was asked and my answer is as follows. My sense is that a minimum qualification for “successful” is profitable on an EBITDA basis (net profit or earnings before interest and taxes, depreciation and amortization) such that your profits will pay back your original investment in a defined time [...]

Marketing campaign goal metrics model: a simplified version of the most important financial model for any consumer product company

2018-12-08T14:21:41-07:00By |Categories: Downloads, Finance|Tags: , , , , , , , , , , , |

The ultimate goal in any company... ...is to acquire AND retain customers where costs to acquire and retain are less than expenses, which leads to profits. Boiled down to this single statement, then the most important variable in the finances is the marketing spend. Even if your other expenses are high or way out of [...]

The Flow of Money in a Consumer Product Company (infographic)

2018-12-08T14:11:46-07:00By |Categories: Downloads, Finance, Visuals|Tags: , , , , , , , , , , , , , , , , , |

The best way to think about this is a profit and loss statement, starting with revenue at the top and net income at the bottom. A customer flows from the top, acquired through marketing spend, and everything in between to deliver that product to them, with profit left over, and all the key metrics [...]

Do I spend the $50,000 on this TV commercial or not? Analyzing a TV commercial opportunity with simple metrics

2018-12-08T13:59:30-07:00By |Categories: Downloads, Marketing|Tags: , , , , , , , |

This is a question from a business acquaintance: I've been approached by a network and their TV show about featuring our line in a commercial as part of an episode. The rub is that they want a $50k "scheduling fee" from us in order to do the segment. This would be a big bet for [...]

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