So how do you determine which portion of your Ecommerce marketing business is accounting for 80% of your sales, using 20% of your resources?
You must track your buyer sources. You must compile tracking data, and then analyze that tracking data until you have teased out the 20% that is most profitable for you.
There are a number of ways that you can do this. You can use tracking software on your web site that tracks the origination of your traffic (using ip addresses, cookies, or some other similar technology). This is the most popular method – and it is the easiest to use and to set up.
However, I use a different method, one that is considerably harder to set up, and does require a few minutes of my time each month the compile the data. However, I believe that I get better long-term results by using my method.
Keep in mind, however, I only track about 60 or 70 different incoming traffic sources, as I do not generally use PPC or other keyword Ecommerce advertising. If I did, and I had perhaps 100’s or even 1000’s of incoming traffic sources (treat each keyword and keyword origination point as a source), then I would be forced to incorporate tracking software, however I believe I would use it in conjunction with my current method.
Before I describe in detail my method, let me explain the methodology behind it.
First, what is more important? Knowing where our traffic comes from, our subscribers come from, or our buyers come from?
Since our buyers are the ones who pay our monthly bills and our vacations, I consider knowing where my buyers are coming from as premium information.
Tracking traffic and subscribers is only useful for short term evaluation and helps us make short term traffic decisions. Buying decisions by subscribers may take months, so if we relied on buying data alone to decide on our traffic sources, we would have to wait a longer period of time before receiving preliminary information. And I do consider traffic and subscribers as preliminary information.
Once I have buying data on my traffic and subscriber sources, I can then make decisions about the actual value of my various Ecommerce marketing traffic and subscriber sources.
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