If you do business though a website, you need to know whether or not your site is creating enough profit for you. Now, you might be saying, “Well, I’m making money, so it is doing its job.” Or, you could be thinking, “Well, last quarter was pretty rough, so maybe my site is not performing all that well.”
Neither one of those thoughts is going to help you much. You need to have a firm, qualitative way of grading your site. Here is a step by step guide to doing just that.
Step One: Have a Specific Goal
First, you have to know why you have the website to begin with. And that is not as simple as saying, “to make money.” You have to be more specific, though not necessarily complex. For example, your goal in having a website could be to sell more items than you would with just your brick and mortar store. That is a specific, yet achievable, goal.
Step Two: Know How to Quantify the Goal
Next, you have to have a way of identifying whether or not you are progressing towards your goal. Let’s say your goal is the one we expressed in step one: to sell more items than you would without a website. How do we know if that is happening? In this case, it is pretty simple: every sale you make through your website is (presumably) one more sale than you would have made without a site. So now we can quantify our progress in achieving our goal.
Step Three: Determine a Value for the Goal
Now you have to determine how much this goal is worth. In our example, where each sale made through the website contributes to our progression towards our goal, it is still pretty simple. We simply calculate the profit we make on each sale. If we sold a teddy bear online for $10, and it cost us $3 for the bear, then our value for that sale is $7.
Step Four: Add up the Values
Now you have to add up the values of all the times your goal was achieved. Using our example, it is again relatively simple. We would simply add up all of the sales that we made on the site, and add up the profits made from each sale. This will give us a total value of the sales we made on the site. This, of course, would be the amount of money we made in addition to what we would have made without the site.
Step Five: Subtract your Costs
Just because you made a hefty profit through online sales does not mean that your website is a success. This is the goal where we finally determine whether or not your site is succeeding. Once you know the total value of your site, you have to subtract the costs incurred in setting up and maintaining your site. If the resulting number is positive, then you have yourself a valuable site. If the resulting number is negative, you will have to decide whether to scrap the site completely or find ways to improve it.
Whether or not your website is doing what you want it to do, it is important to help it out as much as possible. Of course, you can promote your site online. But you can also promote it through more traditional means. These include color brochures and poster printing efforts that aim to drive customers to your site. And every time you print business cards, be sure to include your site URL on them.
