The E-commerce Leader

[00:00:00] Chris: you don’t have to be good at everything in order to find success in business.
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[00:01:00] Michael: Welcome to another edition of the hot takes. Call in, episodes of the e-commerce leader with Jason Miles. Kyle Haymarket, Chris green. Other side of the Atlantic and myself on the correct side of the Atlantic home from London, England, where it all started. Yes.
[00:01:14] Anyway, we’re talking about metrics. We had a good old chinwag about our favorite marketing metrics, which is an agreeably nerdy conversation. But really it turns out to be incredibly important for success versus failure in e-commerce or business generally.
[00:01:27] And, this time we’re going to go into some specific marketplaces, and this is a miniseries today. We’re going to talk about Shopify vital Shopify marketing metrics today. And obviously Jason’s that the, probably the main man for this, because being on Shopify platform for, I believe about a decade, right?
[00:01:42] And then also, Kyle, I know you help. Jason’s your joint clients out over Omni rocket foreman, the called winning on Shopify. So the clues in the name there and Chris, you and I have probably maybe my biggest relationship to Shopify metrics, we will find out. So let’s plunge in and get our hot takes round one.
[00:01:58] Jason, what’s your hot take? What’s your vital Shopify marketing?
[00:02:01] Jason: I love the topic of course. And, I would say that it might be, a nuance here that people haven’t thought through, but my number one. Shopify metrics that I’m really liking lately is the second time purchaser metric. Now think about this to get somebody to your Shopify site is a yeoman’s task.
[00:02:21] You’ve got to figure out your top of funnel marketing. Maybe you’re doing organic, maybe it’s SEO, maybe it’s a paid search. And to get somebody to the site is a big task to get them to. To buy something. Of course it would just be a fraction of people who visit your site that will buy. But the real trick, the real, like where the money starts to really come together is can you get that person who purchased to come by and back, come back and buy again.
[00:02:45] And that has to do with many things in your business, how frequently the item is needed, and on. But that metric, if you start to look at that, how many of your customers have bought a second? Or third, et cetera, et cetera. Item is a vital to the health of a Shopify site in my view. And you can find that under your customer tab in Shopify.
[00:03:06] So I think that’s maybe a nuanced one that people might not have thought through, but, in the customer tab, you can see all kinds of things like customers who have come to your site and signed up, but haven’t purchased anything. People who have abandoned checkout, there’s many metrics there.
[00:03:19] That’s the place I like to get. And that second time purchaser one is my top one that I enjoy. So to look at it because it tells you so much about what’s happening in a business.
[00:03:27] Michael: Excellent. So that’s a nice, clean, simple metric for us to wrap our heads around. Love that. Kyle, obviously you work alongside Jason, a lot in the Omni rocket, formerly known as winning on Shopify clear in the name.
[00:03:37] So what’s your favorite metric that you look at in Shopify?
[00:03:40] Kyle: It’s interesting. I was leaning towards the metric that you had mentioned last pod on the conversion rate, but actually I think I want to go a little bit more even meta in terms of just overall general marketing metric that you need to understand and know, and that’s that the unit metrics.
[00:04:00] Does your product even, is it even going to be survivable on Shopify? Here’s an example. If you have a product and you say you’re selling it for 20 bucks and it costs you. $15 all in to ship it, source it, get it to the customer, get it into your warehouse and do everything you need to do.
[00:04:20] And you have $5 of margin on that product and you’re brand new and you have no other means of getting an audience. It’s going to be a tough sled for you. So I think understanding your unit. Even before you understand what metrics on Shopify you need. I think that’s first principle. You really need to have very deep knowledge and understanding on, and then you start to build on all these favorite metrics.
[00:04:41] So I think I took a back. I’m just like I to know that is the foundation for me on Shopify is whether or not your product is even going to be, survivable, as it is. And what sort of pivots do you need to make it?
[00:04:53] Michael: Yeah, very interesting. For me that comes back to the thing that marketing metrics often have a financial metric behind them.
[00:04:59] And, yeah, I’m totally with you on that. I’ve got to say financial metrics, first marketing metrics, second. Jay, so Chris metrics generally since, so that you have an interesting relationship with what’s your take on the Shopify metrics specifically?
[00:05:10] Chris: I am super thankful that I know people who are good at Shopify and good at NYC metrics.
[00:05:17] And I think that’s kinda the lesson here. Like you don’t have to be good at everything in order to find success in business. There are people out there that teach for free there’s that there people out there that teach for money, there’s memberships, there’s networking opportunities and the things that you’re not good at that I think it was Russell Brunson who said, you don’t always need to find out how you need to find out who.
[00:05:37] So if there’s like this brick wall in front of you and you’re like, I can’t get to where I want to go. Like where I want to go this on the other side of this wall, I see the road, but I hit this wall. You can try to figure out how to break that wall down yourself. Or you can say, you know what, mommy and Jason.
[00:05:49] He is like super good at breaking down this specific exact type of wall. Let me see if I can work with him. He can tell me how to bring it down myself, the shortcuts, how to go around and he can do it for me, a done for you service, like all kinds of things. And I think a lot of people get stuck, especially if you have like kind of entrepreneur mindset of oh, I’m going to figure it out.
[00:06:06] I’m going to do it. Maybe you actually need. Learning new things and trying to figure out how to do something for yourself. And that can almost be a little bit of a curse because learning it is going to slow you down. So I think people need to identify, do I need to get through this wall super fast? Do I need to learn how, because get through this wall myself, maybe not, and I interested to be different for different people.
[00:06:26] So it’s good to stay in the game long enough that you get to meet a lot of different people who are good at a lot of different things. And some of those times those things that they’re really good at, they actually. Enjoy. So they become super proficient at it instead of just, oh, like begrudgingly, learn how to take this wall down and you actually hate it and slows you down and it makes you sour.
[00:06:46] I’m like, no, find someone who’s good at it. And I’m known for living, giving long answers. So I’m not gonna do that today because Shopify metrics are not my thing. So yeah. I want to hear one year old. Jason does it because I get overwhelmed. There’s too many things. Overwhelmed. Leads me to inaction. I want to take action.
[00:07:02] So I want to 100.
[00:07:03] Michael: Great advice yet, who not how that classic. And particularly when it comes to metrics for specific platforms, whether that be marketing platforms or in this case, it’s a sales platform, I guess yet you can get into the pit so fast. I’m certainly guilty of falling into that trap learning stuff and enjoying the metrics too much.
[00:07:18] And then getting distracted. For me personally, I would say. A favorite and the question I’m going to be cheeky here and get some free advice on behalf of a client of mine. Who’s doing very well with the Shopify store. So I think my favorite is breakdowns again, to Kyle’s point more of a financial metric, but I think that the Shopify, interface allows you to do quite well, which is what percentage of your revenue you’re getting by product lines.
[00:07:37] Also I’ve asked her client today to just look at the percentage of revenue by customer, because I want him to dig into how valuable are his trade customers. So quite specific reason for that, because if you can sell something to somebody more than once to your point, Jason, that makes them more valuable.
[00:07:50] But if somebody is going to come back and keep reordering and reordering, cause it’s their business to, buy certain types of products and use them, then they’re even more valuable. So those are my favorite things. Not. Not very marketing metrics of where marketing meets sales really. I’ve got a question though.
[00:08:05] I dunno if this is something you can speak to Jason or Kyle, which is about attribution of sales to pay the ads, because obviously that’s a critical, one of the critical paths that people take. And we talked about our favorite advertising versus organic, Got a client who’s doing quite well with Google shopping ads, but he’s really finding it hard to attribute the sales.
[00:08:22] So how would you deal with that kind of situation or related metrics? And do you think they’re actually useful or not? Is that a red herring?
[00:08:29] Jason: No, it’s not a red herring at all. Kyle can answer this better than I can in terms of the data analysts. We, we track these things with our clients.
[00:08:36] In fact, there’s a killer dashboard product that we have that we build for clients. Kyle was showing it off the other day with a client and they were just like, what in the world? How do you show us all this information? It’s it’s Google data studio product, but it’s just a different tool, but, it is important to break down attribution by ad source and even organic traffic source.
[00:08:57] Those tools are best done through Google analytics, but then extenders like Google data studio or the product that we use. And you want to have that sorted clearly and have a dashboard view, so you can clearly see visually what those numbers look like. And I’m Kyle, if you have any other thought on that,
[00:09:11] Kyle: Yeah.
[00:09:12] I think that attribution as a whole is not necessarily easy. You do have to get a number of technical things, correct. And even then, there is a challenge whether or not it’s accurately tracking, what that, what ends up happening is you have something called like multi-touch attribution and Google analytics has done a pretty decent job.
[00:09:33] Breaking that down or it’ll actually show you the different touch points that people have done. In order to convert and maybe it’ll be like, oh, they saw my ad, but they also searched for me organically or they came in through my website via my email marketing. And you can see that in Google analytics quite clearly.
[00:09:51] So I would say if you’re trying to figure out what’s what to attribute. Dive into your Google analytics, as long as it’s configured correctly and see what sort of attribution that your Google ads does. The nice thing about analytics is the Google ads. Attribution piece is pretty dialed in to that platform because it’s a Google product.
[00:10:11] So you can get pretty clear data as opposed to different platforms, which is a little bit more difficult.
[00:10:16] Jason: Yeah, totally.
[00:10:16] Michael: Excellent. Thank you. That’s a very helpful bit of advice. I’m always afraid of Google analytics, cause I know it’s that talking of data overwhelming, as you say, Chris, I always find that pretty horrendous.
[00:10:26] So ran to and responses to current thoughts. Jason, we’re all shamelessly thinking brain and quiet as well. I know you’re an analytics and metrics kind of guy. Jason has come back to you next, next round of thoughts responses.
[00:10:37] Jason: Yeah. I’ll give you two more, metrics that we really love to look at and, The first one is not obvious and simple to think about.
[00:10:45] The second one is more obvious and, but it’s vital. So the first one I mentioned is, you want to look at your customers and your Shopify site and see who has spent the most money. And it’s very simple to do you just go to your customers tab and then you can, sort all your customers, by total amount.
[00:11:04] And this is a no brainer. You just, you want to know who your top customers are and how much they’ve spent. And I just did that in our site. We have 185,000 customers and our site, 85,000 of them have purchased twice. And I can look to see the name of the top customers right here in front of me, the top, just it’s a running list and how much they’ve spent.
[00:11:24] It’s vital for you to do that for your site. Just so you understand the order of magnitude that. Potentially available to you as it relates to, long-term customer value. Long-term customer value is always a moving metric. The question is how long have they been associated with you, but what’s their terminal, ultimate value to you.
[00:11:42] You don’t know, but so you always have this, a point in time snapshot. So go figure that out is one thing my second metric I want to mention though, is, the most vital thing that most people are familiar with is. Conversion rate on their site, e-commerce conversion rate. And that’s a very, all of us know any commerce that there that applies somehow.
[00:12:02] And I would just say that for Shopify sites, it is the little hinge that swings the big doors. Most Shopify sites for the average have about a 2% e-commerce conversion. And there’s three metrics inside Shopify. They show you that build to that. And then, it’s added to cart and then it’s, is, are they in the checkout?
[00:12:22] And then do they con you know, complete the transaction and those knowing those is vital and managing to higher and higher, frontiers, in that space is vital as a shop owner. And there are many things you can do. I think I said it in the last pod or a few times ago, we had a client who just was brutalized by a low e-commerce conversion rate and spending so much money on effort and energy.
[00:12:44] But the conversion rate was so low and he had a custom theme that he had installed. Whizzbang guru who makes and sells themes. And of course, those are always a bad idea, my opinion. And so he just bought an off the shelf theme from the Shopify theme store and his conversion rate went up by, I don’t remember the exact, multiple was like a factor of eight or 10.
[00:13:07] It just his theme was destroying his conversion rate and he didn’t know it. And, so anyway, conversion rates are a huge one,
[00:13:13] Michael: yeah. It’s, it’s a very striking example of how important the visual layout and functionality of a site can be. Isn’t it? And we don’t always necessarily know that unless you test it and not so new, you’d want to test every day.
[00:13:23] The other thing that just wanted to respond quickly, non-obvious things, the customer who spent the most money. That’s exactly what I was trying to do with a client this morning. So two further thoughts on that one is validating customer value. There’s a useful formula called R F N value.
[00:13:36] Evaluating customer lists are, is recency. F is frequency and M is money. And obviously the higher each of those numbers are the more valuable the person money, obviously in my opinion, being the most important. But if somebody bought recently from you, then they are somebody who’s more likely to be responsive to marketing efforts.
[00:13:50] So again, in terms of, if you’ve got a big lot of catalog of sorry, list of customers after, while focusing your efforts, I think it becomes very important to do an analysis of some kind like that. The other
[00:14:01] Jason: thing. Metrics for sure. Remodel is right. Yeah,
[00:14:06] Michael: totally. Yeah. Which I think is still very helpful.
[00:14:08] It’s not as clean and simple as just being a list by the amount of money people are spending. Of course. But if you can, be aware of that, it’s very helpful, particularly for email marketing. I think so the responsiveness is going to be better for re recency. The other one is. As part of that mix, if you discover, depending on the type of product you’re selling, many products will have a B2B or business consumer type customers, as opposed to being businesses or consumers or business to end user that uses it once.
[00:14:32] And if you can use, you can combine those two. Sometimes the metrics will show you that someone is buying an awful lot of something and you can figure out, oh, you get in touch with them or do a bit of a Google and find out they’re a business that can be a whole new strand of income. I think that comes out of that stuff as well.
[00:14:47] In my mind. Yeah. So that’s me. I’m doing sneakily sneaking in my response there, Kyle or, depending on who feel strongest
[00:14:55] Kyle: about it. Let me just layer in real quick, on what Jason was talking about conversion rate, it’s really interesting too, because we also had a client and you look at their conversion rate on their Shopify store and it w it was not good.
[00:15:07] It was well below 2%, but what was happening was a lot of the traffic organically was going with the content. On the website. And so what you have to do at that point is you have to go back to Google analytics and take a look at the different streams, the different channels of traffic and see where that conversion rate was because hidden within that blended conversion rate in your Shopify metrics was an, it was something really interesting that the Facebook, the paid Facebook traffic that he was driving was converting at 400.
[00:15:39] And it’s ah, if this traffic is converting much higher than anything else, maybe this is something that we should lean into and test, I continue to push towards. So I think that you have to be careful about looking at any metric and especially if it’s blended and there’s different times when you want to look a little bit deeper.
[00:15:55] And I think conversion rates one of them, because you can easily access that information within a Google analytics.
[00:16:00] Michael: Yeah, blended metrics or or big picture matches. Can I suppose they can be a good health check aren’t they, but equally, yeah. As say they can be misguiding as well. Absolutely. Chris, any other thoughts from you?
[00:16:10] Chris: The marketer in me is just listening to some of the things that Kyle and then Jason is saying, and you guys can see it.
[00:16:16] I got a big poster here with all kinds of different books around entrepreneurship and silences and all these things. And I’m thinking there needs to be a book called hinge. Bye Jason Miles, because I don’t know if you made that up on the spot. Jason, be like little hinges, swing, big doors. Did you make that up or is that like on the spot?
[00:16:35] Have you used that before?
[00:16:37] Jason: Not original. To me. That’s a well-known I think beyond me little phrase, but it’s a great metaphor. Isn’t it? It’s just so relevant to these topics. It’s
[00:16:46] Chris: great. I honestly, I’d never heard it before, so I’m like, there should be another book and it’s called hinges little hinges, swing, big doors.
[00:16:52] So one, if the, find the hinges and the two, you have to like, like priests, the hinges, lubricate, the hinges. I don’t know. What’s I don’t know what the best word is for that, but those are the things that can drive somebody to, and they’ll kick. Those are the metrics, right? Like why is the store moving?
[00:17:05] Let’s take a look at the hinges, right? Yeah, the marketer leads just like that needs to be a book and lead magnet. And if people shipping offer and I’m pulling it way off track and you guys were talking about metrics and then Shopify, and I’m over here, sketching book ideas,
[00:17:18] Jason: I’m going to ghost rider, man.
[00:17:20] I have contracts, but right now I can’t do another one called hinges, but it’s a great idea. It is. I
[00:17:28] Chris: love it. 30 page book, short sweet, because it’s about something very small and specific, and it’s not meant to just be a lead magnet, but it’s meant to put something out there as an example, as a story to conceptualize metrics because metrics is.
[00:17:43] But like what hinge swings the big door now I’m listening and oh, that’s actually a metric. And how do I identify and find these metrics? That’s where it goes for me. And that’s just cause I got ADHD and I don’t mark,
[00:17:52] Kyle: there are some definite hinges that, that were, ex broken out in this conversation right now.
[00:17:59] Jason’s talking about a conversion rate. We’ve talked about, repeat orders or frequency of purchases. And I think Michael mentioned frequency of purchase, which that’s a huge hinge. If you can increase your frequency of purchase on your store to get a massive impact on your revenue, profitability, I think your average order value.
[00:18:18] There’s another metric and other hinge that you can spend time in and really get a big outcome, of effort into that. And then I think that, obviously one of the things that most people focus on. Maybe not as in intent as they should is new customers. What is the plan to acquire brand new car, not just sales, because you need to have repeat buyers as well, but how do you get new customers in?
[00:18:39] And then also leads actually people that haven’t bought yet, but are adding them to your email list as a lead, I think is important. E-commerce, metric and thing to track as well. So I think those are all super awesome hinges.
[00:18:51] Jason: You have time for me to tell a little quick leads. That’s it goes to Kyle’s point.
[00:18:56] Yeah. Cinnamon and I run a freemium model on pixie Faire, and that’s why we have so many customers. Many of those people have never spent any money in dollar terms because they’re downloading free items, digital items. And so that bothered us when we looked, when sometimes when we looked would be bothered a little wow, this person has been a customer technically for nine years and they’ve spent a dollar and 43 cents with us.
[00:19:20] Like I said, it’s a bad, but. One of the things that happened was when we launched a new program called sewing was cinnamon. It’s a monthly recurring membership program. We started to look at who was signing up many of the people who signed up had never spent any money with us before, but they had been with us for a long time and they converted into a monthly recurring membership model.
[00:19:43] Just work for them. And I don’t know why, honestly, it worked for them, but they went from a lead that was, carrying cost on our side to have them in the system are happy to have them download the free things, but then they find, we finally found the right product for them. And so if you’re thinking about your Shopify strategy, just realize that people are attracted to your brand or your set of products or your site for some reason.
[00:20:05] And if they haven’t converted yet, maybe it’s as simple as finding a new. Option a quantity packaging, variant, different digital modality versus physical, whatever it might be. That is a great place to be in. So acquire as many leads as you can, and then figure out how to make a match to what they want.
[00:20:26] And, you’ll be doing very well for yourself. So there you go,
[00:20:29] Kyle: a lot of that. That’s awesome.
[00:20:30] Chris: I guess you don’t feel as overwhelmed, right? With metrics. Did you ever feel overwhelmed
[00:20:35] Jason: or is this just always been something
[00:20:37] Kyle: new?
[00:20:38] I’m pretty, I like data. I came from it background, but I also can ignore. Metrics that don’t matter to me in the moment. I think here’s the big secret with any sort of analytics or data it has to drive towards an outcome. Data by itself is useless. It has to be attached to actionable items and actionable questions that you’re asking.
[00:21:02] The real secret is not. Do you have the right data or do you have the right analytics? Is it, are you asking the right question? To then extract that out of the data to make an actionable outcome and decision a plan on. So that’s really the question that they’re asking the right questions. And I think these hinges that we’re talking about and highlighting in here allow you to start to ask yourself those questions.
[00:21:25] Did you then go and make sure that your data is one hooked up correctly and that you have it and that you are reporting on it, frequently enough to work, to influence your decision-making.
[00:21:34] Michael: That’s fantastic advice. I would just say. One of the classic areas where everyone has pain with metrics, which isn’t a marketing metric thing is just doing bookkeeping and financials. And one of the reasons I think people have pain is because they don’t know why they’re doing it. They do it because they feel they should.
[00:21:47] They know they should. They probably heard a podcast by Jason and myself or something saying you should, and we’re not wrong. But the thing is why, if you’re trying to ask the question, what’s my gross margin. You might get it from an, in something like a Shopify app or from something plugged into Amazon.
[00:22:04] If you are trying to figure out what the profit of your business is, then you have to do a whole bunch more number crunching. And the question you ask it to your point, determines the metrics you need. And sometimes the good, to your point, Chris, of getting overwhelmed with metrics. I think everyone gets overwhelmed with some metrics at some point in the business, is if you are asking the right questions with great clarity, often you’ll find you need very few metrics to answer that question in my experience, rather than.
[00:22:27] So particularly I find with, anything that generates a lot of numbers, Google analytics, and other one, which I personally find very intimidating. So I’m with you there, Chris, I think that the only way to navigate that with any sanity is to be very clear. And then also to your point, Chris, I would just ask someone like Kyle to help me, cause I’m just not savvy enough to know where to find the answers.
[00:22:45] And we, don’t a fascinating trip around two more metrics. We also wrap up in a second, any, 32nd wrap up thoughts. Very quick fire round. So let’s start with you, Jason.
[00:22:56] Jason: Great conversation, man. This is good stuff. I love this one. Actionable, I think to Kyle’s point is the main phrase it’s got to be actionable and the directive in terms of how you’re going forward and that’s the whole gist of why you collect data and look at it.
[00:23:12] So yeah, love the conversation guys.
[00:23:13] Kyle: Keep it as simple as possible, but to your point, simplicity will lead to quicker decision-making and faster action
[00:23:20] Michael: of it.
[00:23:21] Chris: Try to find someone that knows how to solve the problem that you have if it’s metrics or something else, but especially for metrics it’s overwhelming for most people,
[00:23:32] Kyle: especially me.
[00:23:34] Michael: Yeah, marketing metrics for specific platforms, including Google analytics and bookkeeping, I would say. DIY is normally the wrong option. Even if you’re going to do it yourself later, you need to have an expert to come in to tell you what to look for. I think the only other thing I would say is I love this idea of hinges.
[00:23:49] There’s nothing wrong with a single title. I’m a little hinges, swing. Big doors is indeed a cliche, but it’s a great cliche and friend of mine. There’s one old business coach, produced a book called turnover is vanity profit is. Which is the oldest cliche in the world, but it exemplifies this philosophy.
[00:24:01] So I’d love that book. And I think to your point, Chris, hopefully what we’re doing with this series is getting business owners to get excited about metrics and connect with them emotionally and find them intriguing and interesting rather than just off-boarding. And if we do that, I think we’ve done a great thing for the e-commerce leaders.
[00:24:18] Final thing to say is if you’re listening or watching, thank you so much for support. Please keep coming along to the calling app. We’re getting a bigger audience there and we are of course, available on Spotify, apple podcasts, Google podcasts, you name it, do come along there and subscribe. If you haven’t already and do give us a or rating out of five stars on any of those platforms, if you can, we’d be very grateful.
[00:24:37] Jason: Love it. Bye guys.
[00:24:38] Kyle: Bye everyone.
[00:24:38]