Product Sales Tracking
Everyone’s constantly after new products to sell, but it’s just as crucial to recognize how your current products are selling. In order to know your best business move, you need to ask the right questions: What’s selling? Why is it selling? When does it sell best? How frequently do my customers buy from me: Just once? Weekly? Monthly?
Ruth King, CEO of BusinessTVChannel.com, an internet TV station focused on small businesses, stresses the importance of tracking your product sales information. King suggests a very simple method for tracking:
• Create an Excel spreadsheet for your customers
• Create a customer number for every new person who buys from you
• Record which products they buy, when they buy, and the frequency with which they buy them.
Says King, “Within a couple of months, you should see some patterns in terms of which products are being bought, how much are being bought at a time, and the things you need to know from a statistical sense to make some decisions about your products.”
When Should I Add a Product?
If you find a product that complements your current line-up, test it out with your existing customer base and see how it sells. Be sure your product extensions make sense with what you’re already selling—don’t add snow pants to your footwear site. Another thing to watch is the cost—if you sell items in the ten dollar range, you’re selling to a particular audience. By adding an item—even a related item—that’s a hundred dollars, you’re now targeting a completely different market. So make sure your goods are similar in taste and price range.
When Should I Drop a Product?
Once again, look at what your sales numbers are telling you—sometimes sales drop for a previously popular item. It may be seasonal, or there may be greater supply in that market than before.
If new competition comes in with a lower price, you can try to outdo them by providing more value—a better website, better customer service, etc. People will pay a bit more if they feel you’re competent and trustworthy. Sometimes, someone has too much buying power for you to compete—that’s when you need to walk away. Says King, “If you find a particular product isn’t selling anymore because a big competitor has come in, go find another product that’s niche oriented and that your customers will buy.”
Do’s and Don’ts
Every product has a life cycle—an item is introduced, it grows, it hits product maturity, and it begins to decline. That’s why it’s important you know when to move on.
• Don’t get carried away with fads. Do know about changes in your market that affect you.
• Don’t try to keep up with every “hot-ticket item.” Do keep abreast of trends and make adjustments as needed. Every large retailer does it and it’s no less important for you and your eBiz.