Another recent tip from Ryan Deiss. He ad his team checked the price sensitivity of on of their products. They tested the product sales at $197 and at $97. They found that they had a 3 times better conversion at the lower price.
There are FIVE measures that you need to know in your business, according to Brad Sugars’ Action Coach model:
- Conversion Rate
- Average Sale Value
- #Sales per Customer
- Profit Margin
Many people I consult with are not able to tell me most of these numbers. That’s scary. No matter what business you run, you need to know the numbers and understand their relationships and impact. Never rely on others to totally look after your finances and never relinquish responsibility for knowing what those numbers are and how they are arrived at. I’ve worked with one woman running $750million dollar business who had teams of people in Finance – the CEO ALWAYS knew her key numbers and if any were under-par she would be asking short and sharp questions!