Record keeping measurements for Internet marketingRecord keeping tracks money -- where it goes, when it comes
in. Internet record keeping is also required for success.
Yet the statistics show that only one out of a hundred
people who own websites do any type of record keeping on
how much it cost them to be there A system that works hard
for you when you don't still requires monitoring and
periodic reviews. If you can't measure it, you can't manage
it, then it manages you.The top keys to making money on the Internet are working
smart, planning, testing, immediately stopping when
something isn't working, reinvest in new techniques and
approaches that improve and then keep testing. For every
success there are usually 10 to 15 tries, sometimes more,
that weren't successful. Even prolific writers create a
number of drafts to get to the end result that works.Here are nine terms you want to become very familiar with
and that you want to use to measure your success. As a past
CPA, these terms aren't just for an Internet site, they too
are usable in brick and mortar operations as well.1. Cost Per Action, sometimes also called, cost per
acquisition. How much does it cost you to get a visitor to
take a specific action beyond just clicking around in your
website? How many click-throughs does it take for visitors
to make a purchase? You can also apply this calculation to
ezines subscribers. (How many clicks were made before the
subscriber registered for your eNewsletter?) You take the
total expenses for running your website and divide by the
number of clicks measured.Example: If the cost per click is $0.50 and it takes 30
click-throughs to get one person to register for your
eNewsletter, the cost per action is $15. If you write
articles, how many registrations do you get for each
article? If your measurement is 10 for each article and it
takes you about two hours to produce and deliver the article
over the Internet. If your estimated hour rate is $100 per
hour, then each registration is costing you $10 plus your
web expenses.2. Cost Per Sale. To measure, divide the marketing
expenses by the total number of transactions to come up with
the cost per sale in a dollar amount.3. Return on Investment, also known as your ROI. Divide
your gross sales, this is all your sales coming from your
website, whether it is from affiliate, commission,
advertising, or items sold, by all your marketing costs --
all that you have invested in its production. You come up
with a percentage amount which is the bottom line on how
successful your marketing was in terms of sales. You must
also calculate in refunds or credits in this formula. If
you gave away a number of products you need to count these
as part of the items sold even though they didn't land any
money in the bank account. Giveaways are a frequent
overview in this calculation and can be a huge eye opener.Example for service professionals. If you provide a service
where you give away the first session as complimentary, give
a presentation for a sale, or prepare a proposal, these
costs also need to be included in the ROI calculation. If
you provide this service in person you need to add in your
travel time and an average cost for car expenses (not just
gas). This is why it is so important to prequalify. For
coaches, consultants, and other freelancers, this is why I
recommend only performing complimentary session over the
phone or in your office. If you already calculate this into
your fee then this could be an exception.4. Pay Per Sale, also called a referral fee for closed
transaction. This is typically a percentage of the sales
generated by the advertisement. A commission is paid when a
sales is made by the advertiser and not by the number of
click-throughs. Advantageous to the advertiser not to the
publisher.Example: Someone places an ad in your newsletter with an
agreement to pay a higher percentage fee for each sale but
zero for any nonsales. The responsibility of success for
the sale falls mainly on the advertiser. If you enter into
this type of agreement, make sure the advertiser delivers on
their promises, and has a structurally sound sales
processing system in place. Including a method for
reporting what sold, when it sold, and where it sold.5. Customer lifetime value. Stated in dollars, this is the
average length your customer remains with you divided by net
profit of that value. If you are new in business or don't
have the actual figures you will need to estimate.Example: If you are a coach or consultant and you have an
average of 22 steady clients per month for an average
agreement of six months. Your net profit for six months
would be $46,200. You then divide the $46,200 by 22, this
equals $2,100. What this means is that every client that
you acquire for six months is worth $2,100 to your business.6. Cost Per click, also known as cost per click-through
(CPC). How much you have to pay for every time someone
clicks on your ad -- clicks from that point to the next
point, usually your website.Example: You purchase a banner space on someone’s website
for your product or service. That space costs you $400 for
the month. There were 225 click-throughs from that banner
to your site during that month. $400 divided by 225 equals
$1.77. This equates to $1.77 per click-through.7. Cost Per Lead, also known as pay per lead. This usually
occurs when you purchase prospect lists. These are specific
lists from people who have already given permission to
someone else that they are interested in this type of
product or service. In other words, they have opt-in
(chosen to join) to a similar request, and they are the
target market you are looking for. These leads can be
limited to just providing the email address or include other
contact details.(c) Copyright Catherine Franz. All rights reserved without
permission.Catherine Franz, a eight-year Life and Business Coach,
Graduate of Coach University, Mastery University, editor of
three ezines, columnist, author of thousands of articles
website: http://www.abundancecenter.com
blog: http://abundance.blogs.com
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