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How To Lose Money Selling Products
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- เผยแพร่เมื่อ 14 ส.ค. 2024
- Get My Product Pricing Guide:
www.vanader.co...
Chapters:
0:00 - Introduction to Maker Magic Costs and Profits
1:30 - The Realities of Shipping Costs
3:00 - Tackling the Challenges of Reducing Costs
4:30 - Understanding and Improving Average Order Value (AOV)
6:00 - Creative Strategies for Enhancing Product Value
7:30 - Efficient Packing and Shipping Process
9:00 - Conclusion: Maximizing Profits and Future Strategies
My name is Evan, I own a crafting company called Scorch Marker and I coach people that sell products of their own so they can do what I did and make more money.
Grab my ecom checklist so you can see what I can help you with and what I teach:
docs.google.co...
If you want to chat, DM me on Instagram @vanadergrowth
Instagram:
/ vanadergrowth
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$10 is to acquire a new customer. Return customers cost you nothing, just a small retention cost. Lucky for you, this product is a consumable.
229 Thousand Subscribers. $10 acquisition costs is inflated, with this said. Vanader's information is super valuable. He earned my like and subscription.
I’m an e-commerce business runner myself and I have to say between the thousand of contents from this so called business magician everywhere you’re the only one that actually know what he’s talking about ! Good job 👍
thank you for watching my friend
the only working ecommerce at the moment are gaming and youtube ing
Same! Have had my biz since 2005, and nobody seems to get it! Except Evan does get it!
This is why websites incentivize free shipping at a certain price point so that it pushes you to buy more than one item so you can get the free shipping
Here is an idea that I've seen work:
Raise your price for a single to $24
Price a 3-pack at 2.25x that price
Offer a 10-pack for 5.5x the cost of 1.
Then display it like this:
1 Marker Magic: $24
2 Marker Magics: $48
3 Marker Magics: $54 ($18 each)
4 Marker Magics: $96
5 Marker Magics: $120
10 Marker Magics: $132 ($13.20 each)
You set the anchor prices there to highlight the ones that are discounted.
You'll see more higher volume sales.
I don't even do e-Commerce or anything like that but your explanations are very clear and the whole topic is really interesting! Thanks for making this, I sure will check out your other videos!
I am just starting back to my little business after a huge break of almost two years due to a catastrophic event my son experienced. I have just found your channel. What a gift you are! Thank you!
I'm happy to subscribe!
This is a really good way to make business marketing concepts relatable
This is excellent advice for a small business, my small pizza chain had free delivery and we had a very high percentage of high profit, low cost adds , very subtle sales techniques were used by all the order takers, not unusual to add 30% to the order that had very little additional costs, bread sticks and an extra topping special for example.
Give back a percentage in weekly profit sharing from selling those specials directly to the workers and you could guarantee everyone was onboard.
So a $2000 night would be $2600 using your average sale technique.
Your video popped up in my feed and I thought ‘man, this product sounds familiar’ and I remembered that you and your wife came to my painting class at Pinot’s Palette months ago! So glad your business is doing well and I dig your content!
Thank you very much. You are an excellent business man and an excellent human for sharing the inner workings of your business with the world. I learned more by watching your videos than any college class ever taught me.
Do a video about customer acquisition and why it costs you $10 … unless you already have. Very helpful! Awesome content.
I'd just like to say thank you for all you share in the world of e-commerce!!!!! it's so much fluff & disgust on TH-cam University. I appreciate your clear and useful videos
Love this video man! I own a small brick and mortar juice bar and the AOV aspect can make or break us! Which is why we always have package deals for some our products. 👏🏻 👏🏻
you know! awesome business i like those
Clear, consice, exactly what I came here for. Your video was awesome, and an education. Thanks.
I just subscribed, by the way. Thanks again.
Glad you enjoyed it! really appreciate you watching my friend!
dm me on instagram if i can help in any way.
instagram.com/vanadergrowth
This is how Frank V. From Melaleuca started. I did everything you are doing right now at a little over minimum wage. Bro, this is easy peasy.
Great video and content. Your presentation and authority are welcome! One of the clearest and concise videos I've watched.
Great video. This explains why lots of e-commerce offers free shipping for orders over $50
I'm not in the Amazon/Shopify hustle. But, I found your video very informative.
Thank you for sharing this information. I am a new business order, and I've been finding this out the hard way. You don't know what you don't know.
I was confused at a bunch of this at first, then I realised it was the same things I did when I was able to work retail. Different words, and I know this is a brief overview because there are other things you can do, but still interesting.
Great video! I need to look at my pricing and packages again.
There's also lifetime customer value or LCV. Get customers on a newsletter and loyalty programs. No acquisition costs while increasing their value and loyalty. I guess you'll make a video soon about it.
agree! this is huge and wasnt talked about in my video. i stuck to the front end. but youre right. is LTV:CAC ratio can support it you are golden!
4:47 25-8=18$ nice maths I hope all costs could be deducted the same easy way :)
Jokes aside nice video nice information and nice channel! verry happy I found this channel
Thank you for your help i recently opened my first shopify store last month and these video's have been very helpful with getting ahead of the learning curve
Lifetime customer value is even more important than AOV. Every time they come back and buy more, you're getting a sale without that $10 customer acquisition cost.
Agreed. It’s one of if not the most important for sure
Great video. Practical examples and real world experience. Good job!
excellent, good tough sales method and advise from the school of hard knocks...thanks for sharing. acquiring and retaining clients is so difficult these days...when i buy online vitamins ie i like to buy several items from same seller so he could save on shipping/ handling fees...i wasn't aware of your formula though how profits are realized that way...
Fantastic explanation.
Amazing video! Very helpful and straightforward. Thank you!
Lower the weight with packaging to under a pound for first class shipping,slightly cheaper, make that for the people who want a small amount, then sell in gallon size with all the bells and whistles for people who use it a lot. And do the triple for 50 like you’ve been doing,good problem to have,as long as people keep buying it.
But with three, wouldn't it make more sense to give one normal pack and two refill packs? That would take up less space and use less plastic... is that worth thinking about?
We have run into the same problem and FB is the culprit. FB costs are now disproportionate to their value. Of course that’s the hard part. Finding a better marketing engine than FB as it s no longer the value choice.
i would agree with this
Wow, most valuable information yet this year. Now I just have to find my product or product line. Happy New Year 🎈
thanks for watching. when you are ready i can help you
I’m just blown away dude, thank you.
I think I could probably get your CAC down but I'd have to see your current ad set and ad strategy, its possible its just a tough product to sell if the target is too broad.
love your work.
The $10 for generating leads off Facebook is only for new customers right? Do your customers go through Facebook every time they want to buy something from you? It seems once you have a customer, they should not have to go to facebook to purchase your products. Am I missing something in the description??
Yeah your CAC is how much your spent on advertising or paying someone to post on Facebook and instagram or whatever divided by how many new customers you get.
Once those customers are established and buying again, you start segmenting them by their lifetime value or CLV.
They still might utilize an ad to buy, but that’s factored into the CLV
@@StephenSatire thanks for the explanation!
So best way to do it is find a price point where you can give the customer a deal with the product to buy more so you get more volume I do this with wood sales to gas stations everyone says no I’ll only buy 50 so I say ok if you buy 50 I’ll sell them at 8.50 but if you buy 150 I’ll sell them for 7 and give you a few free this way they get that deal and you get taht volume
That also means setting a minimum so you don’t lose money if I delivered one bag of wood of course I would lose money cause of gas and labour
Do you make your own decoupage???
He makes a video but works on the side, which is efficient and likeable
thank you for watching friend
what if you try to use inventright youtube channel / schooling to learn licensing & go for a royalty of 2.5% - 8% deal & start 12.5 for negotiations & let a mega company blow those out way faster & cheaper vs venturing...
Have you tried calculating other shipping services like Pirate Bay or others like that
I'm confused as to why you are paying for shipping. People understand that it takes another party to move the product. Heck, I pay shipping on a lot of small items or low priced orders. It's art of doing business.
Customer *always* ends up paying shipping, either separate or included in the price. For some twisted psychological reason, MANY (most?) _love_ so called free shipping. So you have to "comply". Same thing with so called "no interest" credit payments.
@@fahey5719 There are a few reasons. Shipping handling costs don't scale linearly with order size. By pricing it in you are taking a higher profit on larger orders and subsidizing the smaller ones. That can reduce the friction on a new sale going to completion. The second and more psychological is that a big add on at the end of the shopping experience is a big of abandonment.
Another way he could have structured the sale is $15 per container and a fixed $5 s&s. One would be $20 and the three is still $50. Marketing at $15 might get more leads but that $5 hit at the end, a third more in cost will also make many reconsider the deal. Even more so if it is unexpected. People don't like surprise increases in costs. See how much people hate sales tax and tipping being added to the bill.
All credit programs help make the sale today, rather when the customer has the money. The "no interest" part get them to pay a higher margin and gets people to ignore the hidden high interest rate and/or fees if they fail to follow the terms. Lots of money is made on people screwing up "free" deals.
Im glad yt is pushing your content. Got a new sub.
I am going to order some on amazon. really great video!
Why not get the bottles made in China and shipped to you? I found this process is way less expensive and helps increase profits.
Wow. Great video. Subscribed.
@Vanader - Who or what are you paying this $10/customer? Is this ad direction or something? Do you have a video explaining this?
Thanks for your excellent advice.
Dude you’re a Wizard!! 🙌🏼🥰 I just came across your content and love it!! Thanks for sharing your wisdom!! 🙏🏼🥰
Keep up the great work!! ✨
Cheers!!
Thanks for watching Chad!
You should actually lower your price a little bit more on the larger order and definitely raise your price on the single order from where it is. Think about how much more attractive the larger order will be if the small one is 22 or 25. You should actually make less profit per volume on larger orders than small orders by a tiny bit, not more. If that isn't happening then you are pricing your smaller order wrong. Unless correctly you view your small orders as a marketing cost to get people to take larger orders. So then you should calculate the marketing value per small bottle that goes out, and make sure that total with actual profit is higher or on par per unit than your large orders. I wonder how an even smaller product would perform on that metric. Your average cost of customer acquisition would actually be less because of the higher conversion and your adjusted profit would be about the same. It better be positive or why sell it?
Wow… i never knew this… thanks for the wealth of information,
Is this just PUR glue?
Thank you
I do love a good bundle
now you say it cost you $10.00 to acquire a customer? are you saying one customer? and how does that work? now what about your other friends? do they pay the same to acquire a customer for there business? I don't know how it's done, but can you and your friends share that acquisition? lowering your cost, like if you got 4 friends and they sell there product along with your's on the same page? if it's that way you can share the page? what ever it is? is this some form of advertisement?
bravo. Everything you said is true
Congratulations, you figured out what Costco has been doing for years, now you just have to sell a membership
Probably the best explanation video I have ever seen on ROI. Well Done Sir I have seen many videos
Isn´t shipping paid by the customer?
Great video. Thanks.
Can someone type what he called that wooden spoon at 6:49 I never heard it before, it sounds french. Its bugging me since I can't type it close enough to have Google correct me. Not that I have a thing for knowing the correct way to say that exact wooden spoon but learning it wouldn't hurt.
Accoutrement. He's saying it with a bit of a French flair. It means accessory.
@@easyas314 Thank you, i would have never gotten close.
Dude, I can supply you with the containers and induction caps.
Good video, thanks!
But is no one here apart from me wondering since when 25 - 8 comes to 18? 🤔😅
That is the real reason he is losing money!!! lol
Not sure how this video ended up in my feed. But, if I really enjoyed it lol..
Do you need to pay tax too on stuffs you sold?
One of the best explained videos on YT. Thank you so much
Excellent!
man this video made me to subscribe.
24.99 a piece, buy two get one free until you can tighten the other parameters?
that is an excellent suggestion! one i have seen work in many businesses
Maybe then it will put you in the green at least for single orders. Maybe it will potentially have more viewer appeal effectively lowering your cost to acquire a new customer. Whenever you want to take an L on single units in hopes of spreading rand awareness you could just run a sale on your singles for your 19.99 price point.
Repeat sales should have a zero customer acquisition cost. therefore adding $10 to your gains
What is picking and packing and who are you paying to do that?
3pl or a warehouse that ships for us
Today I learned something
Great job
It's kind of like synergy
I like you. If your goal is to make friends then you are winning my friend 😊
Add shipping on top of it so it doesn’t cost u the shipping cost and also you forgot to take out taxes
What is the product?
Good stuff
Subscribed!
Well done video
adding accessories - VALUE ADDED...
What ads 10$ cost mean? Do you pay 10$ for each 1 bottle selling?!
YOU SAID IT: HOLY COW!
IN MY BEST 19TH CENTURY BRITISH SOLDIERS ACCENT:
ONLY IN INJA! (India).
Dave off the top rope! That bit on Kamala was incredible.
people in their mind will determine a cap! I won't buy a product that's to high in price!
agreed
Perfect
Subscribed.
raise the price - hire oompa loompas - do affilliate marketing and have people sell your product for you
Do you have insurance?
Simple solution, change your marketing. If you pay $10 per customer and they spend only $20 a unit you either need repeat customers or to lower your advertising cost. Do other forms of advertising simple.
You have any suggestions? Please post it.
@@fahey5719 It would depend on the business, but you can implement incentives for word of mouth spread, offer affiliate bonuses, or use different mediums of advertisement, such as tv, newspaper, or youtube.
Fixed costs vs Variable costs
Ads cost $10? Mean for 1 product or every single pcs sir?
That is his customer or sale acquisition cost. To put some simple but realistic numbers to it, you might pay $100 to have your ad shown to ten thousand people ($10 CPM [cost per thousand]). From there you expect about 1% (100 people, $1/click) will go to your online store and of those 10% (10 people, $10/conversion) will purchase.
Knowing all those different numbers helps you evaluate different aspects of an advertising campaign, websites, sales platforms, checkout systems, and more.
If my school teachers had taught like how you are, I'd be a lot richer! ADHD sucks!
$25 minus $8 is $17 just saying love the video though
put it in a square container and save on space
So that's how stuff like X% off when you buy X amount of units of a product works.
In a single, Drop the contents down one ounce and selling it for $18.98
Great Info Thank You 👍❤
You are so welcome thank you for watching
Sell french fries. Boom, problem solved.