What Numbers Matter in eCommerce Brands?

Kenny Hoang

Kenny Hoang

With no clear business goal, there’s no accountability.

It’s like preparing for a Fight without aiming towin. Hard to imagine because it’s implied that winning nets 1 – 0. While a loss nets 0 – 1.

In eCommerce there’s an abundance of numbers that makes it hard to see what a win is.

LTV – Life Time Value
CAC – Customer Acquisition Cost
CR – Conversion Rate
AOV – Average Order Value
ROAS – Return on Ad Spend
COGS – Cost of Goods

What numbers do we look at?

Like a fight, there’s a lot of numbers at play.

SLpM – Significant Strikes Landed per Minute
Str. Acc. – Significant Striking Accuracy
SApM – Significant Strikes Absorbed per Minute
Str. Def. – Significant Strike Defense (the % of opponents strikes that did not land)
TD Avg. – Average Takedowns Landed per 15 minutes
TD Acc. – Takedown Accuracy
TD Def. – Takedown Defense (the % of opponents TD attempts that did not land)

Sub. Avg. – Average Submissions Attempted per 15 minutes

But even with a lot of numbers, even the casual fan instinctually understands the important metric and that’s to win and not lose. 

In business that goal is often foggy.

A ROAS (Return on Ad Spend) of 3.4 is good isn’t it?

A CR (Conversion Rate) of 0.54% is bad isn’t it?

Wait my CAC (Customer Acquisition Cost) is way too high at $54.

It’s hard to say without more information.

A ROAS of 3.4 could be a failing campaign if the Cost of Goods are too high and putting the Brand at a Loss.

A Conversion Rate of 0.54%.might be phenomenal if it hits the ROAS Target.

The Customer Acquisition Cost of $54 might be incredibly affordable knowing the 90 Lifetime Value gives a Profitable Payback.

That’s why the primary metric in business is Profit.

Specifically, is your Profit Margin Goal being hit Month over Month?

If your Profit Margin is 20%, then if this month you’re at a 23% Profit Margin than you win.

If you’re at a 15% Profit Margin than you lost.

When we Partner with Martial Artist Owned Brands we first audit the Business to understand in detail the state of the numbers.

Then we literally do the math to see if we’ll be able to help.

Because sometimes before pursuing Growth and Marketing, a Brand might have to dial in their Supply Chain to improve their Cost of Goods.

Or they may need to improve Product Fulfillment to prevent being penalized by Facebook’s Page Score and being charged higher CPMs.

Once we know the Profit Margin %, then we can map back to Secondary Metrics of a Marketing campaign such as what ROAS or CAC targets you need across your Products.

If Gameplan of a Fight is to Win, the Business Goal of a Brand is to Profit (Specifically X% Profit Margin Month over Month)


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