Cracking the eCommerce Code: Metrics Matter | Sadaf Beynon

Matt Edmundson

00:00:00.240 - 00:01:10.840

My name is Matt Edmondson and beside me is the talented and beautiful, debonair, gorgeous Seth Baylon, who is the show's producer. It's great that you're here with us. Why are you laughing?

In our August series called the what we're doing, dear listener, is if you didn't catch last week's episode, August is a little bit different, isn't it? August is one of those funny months of the year.

And so we had all kinds of grand plans for August this year, but alas, we decided to change it very last minute. We are recording these episodes where Sanif and I have a little chat about things that we have learned along the way from E Commerce Cohort.

We're going to explain what E Commerce Cohort is. We're going to talk about the lessons today from Oliver Spark's workshop, what they meant for our business, our ecom business.

And just to give you a little flavor of what's going on behind the scenes, it's going to be a cut down version of the show of the podcast because we appreciate August is one of those things. It's just one of those months where most of the world seems to shut down. So yeah, hopefully that all makes sense. Does that make sense, Salaf?

I don't know. I know what we're doing. I don't know if I've explained it well enough.

Sadaf Beynon

00:01:11.640 - 00:01:14.120

Yep, makes sense. Makes good sense. Carry on.

Matt Edmundson

00:01:14.120 - 00:02:24.080

Good, good. That's the main thing. So, Cohort, let's talk about Cohort because Cohort sponsors E Commerce Podcast.

If you're a regular listener to the show, you will have heard me say something along the lines of this show is sponsored by E Commerce Cohort and E Commerce Cohort is something that we do. It's part of our business network, for want of a better expression. And it's this basically is training, E Commerce training that you can sign up to.

And the way it works is every month we do an expert workshop and we do a mixture of coaching and Q&As around that expert workshop to help you extract the best parts of it for your business. And we say listen, take away like three or four key key points from that workshop. Figure out how it's going to apply to your business.

We help you with that, with coaching. Any questions you've got, we do with live Q and A. And then hopefully it helps you grow your business.

It's kind of like E Commerce podcast, but on speed. It's kind of really focused on being hyper practical, isn't it? And the workshops are hyper Practical from these great guests.

So that's kind of how it works. Have I missed anything?

Sadaf Beynon

00:02:25.450 - 00:02:26.570

No, no.

Matt Edmundson

00:02:26.970 - 00:02:28.610

All there. Yep.

Sadaf Beynon

00:02:28.610 - 00:02:30.090

All there. All, yeah.

Matt Edmundson

00:02:30.090 - 00:02:39.410

Awesome. That's amazing. Right. As long as I've got it all there. So which one are we doing today, Mrs. Bainon? What cohort episode shall we do? Or cohorts.

Sadaf Beynon

00:02:39.410 - 00:02:48.970

All right, so we're gonna keep going with the momentum from last week or a few minutes ago with a peek into the number crunching world.

Matt Edmundson

00:02:50.650 - 00:03:01.540

Don't say. Because everyone's like, what do you mean from a few minutes ago? No, no, no, no, no. This.

We obviously record these episodes once a week to keep on top. We don't batch record in any way.

Sadaf Beynon

00:03:01.540 - 00:03:03.380

That was just a slurp.

Matt Edmundson

00:03:05.140 - 00:03:37.940

So happens, Matt, you're wearing the same top that you were wearing before. But that's okay, you know, it's just. Is what it is really. But no, we recorded episode one and then we've gone straight into episode two for August.

So behind the scenes, full exposure. We are doing these back to back recordings and we're not going to get them all done, are we? Today because of time. But.

But that's what we're doing because August we tend to not be around as much. So we appreciate you on holiday, but we're on holiday as well. Just clarifying. We're not being lazy. But yeah, sorry, I totally interrupted your flow.

Then what were you talking about?

Sadaf Beynon

00:03:37.940 - 00:03:53.460

No, no, that's okay. I was saying that today we're going to be diving into the number crunching world of E commerce metrics with Oliver Spark.

So we're going to be talking about the lessons we learned from his workshop. And how about we start with.

Matt Edmundson

00:03:55.280 - 00:03:55.360

You.

Sadaf Beynon

00:03:55.360 - 00:04:11.440

Know, we're talking about the three letter abbreviations that we have all over E commerce. So AOV and CAC and you know, all that good stuff. So Matt, do you want to jump? Do you want to talk about that?

Matt Edmundson

00:04:11.920 - 00:04:37.260

Do you want to build a snowman? No, it's. Yeah, we'll talk about Oliver, Spock and metrics.

I think what you need to do though, sadaf, whilst I just talk about some of the lessons that we have, you should go into ChatGPT and see if you can come up with a sexier title or description. Then we're going to do some number crunching and metrics because it's just one of those things where you just go, it's maths, I don't care.

Sadaf Beynon

00:04:38.060 - 00:04:44.060

Listen, Matt, I don't think it matters what kind of title you give it. It's always going to be like that.

Matt Edmundson

00:04:45.340 - 00:11:16.550

No. Well, your challenge is to go try and find a different. Anyway, let's take pictures now.

Full disclosure, Oliver's workshop at the time of recording was one of the most recent ones. We've got Monica coming in August, which I'm really looking forward to. But Oliver's is the most recent workshop that we've had.

And whilst metrics can sound a bit dull and uninteresting, Oliver made it actually really, really interesting. And we learned a lot from this.

We watched the workshop as a company, we went through it, we had lots and lots of conversations, lots of conversations. And Oliver has been on the podcast as well. So if you caught that episode, you will know that Oliver is in fact from the White Company.

He was one of the guys that sort of got it to where it. It's a huge company here in the UK and so he took it, I think from 6 million at that point upwards.

I can't remember the exact time he joined, but he knows retail and one part of his story is the discovering of sort of key metrics which really helps him understand the growth of his business. And this is what he was talking about and how we can do it in a super practical way. So.

And the reason I liked Oliver's workshop is because he agreed with me. Oh, yes. Now this is. It's a beautiful thing when you come across experts who say the same thing that you do. Makes me feel good about myself.

Now, he was a bit like when we talked about Vance Morris in last week's episode a few minutes ago. He agreed with me about a few things. Now, about touch points. But Oliver talked about key metrics which you need to measure.

And we've talked about this, haven't we, in our office. There are three key metrics that you have to be really aware of.

The number of new customers you have, the average order value and what I call customer frequency. But what Oliver calls aoc, which is the average number of orders per customer. I call it customer order frequency. Same thing.

But this is basically how many times a customer will place an order with you, say over a 12 month period. So if they place two orders a year, can I increase that to three orders a year? For example?

If I can, I'm going to increase my business by a third, right? So if I can increase average order value by a third, I'll grow my business by a third.

If I can increase no customers by a third, I'll grow my business by a third. The cool thing is, if I increase the number of customers and the average order value and the customer order frequency.

If I can increase all three at the same time, I don't. I get geometric growth, if that makes sense, which is where it starts to become quite beautiful. Anyway, he talked about this, Oliver.

He talked about tracking the number of new customers, the customer order frequency, and average order value, which was great for us. Just validation that we were on the right track. And really liked how he was thinking.

Love how he's got something called SuiteAnalytics, a little bit of software. If you're looking for a dashboard, check it out. We're having a little play on it at the moment, actually, with one of our E.

Com companies, because it tracks these three metrics really well, which for me are really key metrics, if that makes sense. Yeah, that was really, really good. Really validating.

And just again, looking at that from our point of view, one of the things that came out of it, he said this on the podcast, and he also said this in the workshop, and he talked about it on the. In the workshop a little bit more, which I've never really heard anybody talk about.

And this was, you know, when you get these sort of little aha moments when someone's talking, you write it in your notes and you star something or you draw. I draw boxes around things because I thought it was super cool. The way Oliver mentioned this.

He said, you need to understand the number of new customers you have to have to get your growth target.

So if you want to grow from 1 million to 5 million over the next three years, how many customers do you need in year one, in year two, in year three, what are the new. What. So don't just tell me you want to go from 1 million to 5 million. Translate that down to actually how many new customers you need to go and get.

Right? And so this was super powerful because everyone's growth target I've ever come across is we want to grow by 20%.

So it's either a percentage growth or we want to grow by a turnover number. We want to grow by a million pounds. We want to grow by $300,000 a year, or whatever your growth targets are. Right?

And everyone defines it in those two terms. Where Oliver came in and did something differently, he says, oh, these are great, actually. What does that mean in terms of number of new customers?

And so to understand the answer to that question, you've got to understand how many of the customers, how much customer buys, what's the average order value, what's that customer, you know, how many times they come back, what that has. You got to extrapolate that with some clever maths in Microsoft Excel or use suite analytics, either way to come up with a magic number.

So if I know actually to reach my growth targets, I need 2004, 446 new customers. Well, that becomes quite defined, doesn't it?

That becomes quite a lot easier from a marketing point of view to go, right, go and get me two and a half thousand new customers. The third lesson, obviously Oliver talks about them. Following on from that is CAC your customer acquisition costs.

So understand how many new customers you need, what it costs to go and get a new customer. And obviously that needs to be lower than the value they bring to your business, otherwise you have problems and you're hemorrhaging cash.

But so let's say a customer average order value is 100 bucks, but it costs you 30 bucks to go get the client and you need 2,000 of them. Does your marketing budget then have a 60,000 allowance in it to go and get those 2,000 new customers?

Right, so your marketing budget is set around the number of customers you need to go get, which I thought was very clever, very insightful.

Obviously there's other things that we need to include in our marketing budget, email marketing, repeat purchases and all that sort of stuff, which is great. But in terms of customer acquisition going, getting new customers, the big takeaway for me, can you define the number of new customers that you need?

What's the cost of getting them and does your marketing then align with those things? Now he talks about that and much more in the workshop.

Gives you some great ideas about how to measure them, how to do them, but that was the powerful takeaway for me.

Sadaf Beynon

00:11:17.830 - 00:11:39.670

Yeah, a growth strategy that is cognizant of the value of new customers is quite game changing, isn't it, for an E commerce business?

It's not like the metrics help to guide the direction of your business, but having that information makes it seem like it takes it to a different level.

Matt Edmundson

00:11:40.650 - 00:12:10.740

Yeah, it does.

And this is true whether you're starting out, whether you're brand new to E commerce or whether you've been, you know, like me, you've been around a while and you're a bit of a dinosaur in E commerce.

But this ability to translate it down like, I need to go and get 500 new customers this month and just track that and relentlessly track it and go, am I going to be on target, yes or no? There's obviously more to it and Oliver covers that in the workshop.

But you're right, it's one of those things that Is it's game changing because it's very definable. It's certainly quantifiable.

Sadaf Beynon

00:12:11.380 - 00:12:11.860

Yeah.

Matt Edmundson

00:12:12.260 - 00:13:04.560

And. And going after that, I think then becomes. Becomes one of your primary aims really, in E commerce.

And so really valued that workshop, you know, Oliver, such a legend. We've had a lot of conversations since actually a lot of questions came in. Gone back and forth with him on some of the answers to those questions.

Really intrigued by some of the ways he measures things and. Yeah, fascinating guy.

We're doing actually a joint call this week with a company which I'm really looking forward to, actually be really interesting to see how he works. And the other thing I'm looking forward to is getting behind the scenes on his dashboard software and see what that comes up with.

Because I've not actually. I've seen some screenshots of it. Oliver showed me a bit of stuff, but I'm getting into play on it and stuff will be quite cool.

So, yeah, do check him out. Oliver. Oliver Spark. You can find out more information@suiteanalytics. I think it's suiteanalytics.com.

Sadaf Beynon

00:13:04.560 - 00:13:06.840

It is. It is, yeah.

Matt Edmundson

00:13:07.080 - 00:14:13.650

Now, when we did the workshop, the way we do this, ladies and gentlemen, you will not know this because you've never been in how we do this, but what we do is we get everyone around a monitor in the office. We watch the workshop, and we usually have someone leading that. It's not me all the time. In fact, it's very rarely me.

It's like if it's a marketing sprint, Jen, who heads up marketing will do it. And so Jen will get everybody around. She'll bring cakes or pastries in or something.

We'll sit and eat them and watch it on a Tuesday morning, the workshop, and then we'll chat about it. Tomorrow is actually a Tuesday. Last week we watched Oliver's Sprint. But you weren't there. No. Because you are in sunny Canada.

You were not in the office. You were on your extended trip away, thanks to digital. It's like I'm gonna have two weeks off and then I'm just gonna stay in Canada for three weeks.

I'll. I will work in Canada is what I will do as I'm hanging out by the pool with my family and then I'll be back at the end of July.

We're like, yeah, okay, whatever. So you actually missed this one, didn't you? You missed this whole workshop sprint.

Sadaf Beynon

00:14:13.730 - 00:14:14.850

I did, yeah.

Matt Edmundson

00:14:15.490 - 00:14:16.330

See? Miss it.

Sadaf Beynon

00:14:16.330 - 00:14:16.770

Miss it.

Matt Edmundson

00:14:16.770 - 00:15:34.170

What can I say? What can I say? So, yeah, that was Oliver and I Think if you want to know more about Oliver, do check out his podcast. His podcast was super cool.

Really enjoyed it and in fact it was his podcast. He came on as a guest after and this is normally what happens with Cohort. I interview people on the podcast and I thought Oliver's such a legend.

I thought he could do super well on one of the workshops. And so he offered to do the workshop. He did this hour long extra training. The workshops are only about an hour, by the way.

They're not like four hours long. We about talked. We have the workshops delivered in an hour or under. Has to be there because we want it all to be lightweight.

We don't want to add to the overwhelm because we're already overwhelmed. Are we? So, yeah, we don't want to do that. But if you want to know more about Cohort, do check it out.

Ecommerce cohort.com Obviously, any questions, you can email us and we will try our level best to answer them.

But if you would like to join E Commerce Cohort, we would love to see you in there in the membership and of course, absolutely no pressure to do that whatsoever. Just stay subscribed to the podcast. You're also going to learn a lot from that. So it's a win win scenario, I feel. Win, win. Right? So yeah, awesome.

Cool. Anything else from you, Mrs. Bainon?

Sadaf Beynon

00:15:35.290 - 00:15:37.850

No, I think. I think we're good.

Matt Edmundson

00:15:38.890 - 00:16:39.850

Think we are good, which is great. So let me play this theme tune in the background because it's time to end the show.

Thank you so much for listening to our special August series where we've looked at Cohort with Oliver Spark. Next week we are looking at Marketing Personas with Neil Hawt. I'm laughing because I don't actually know when I'm going to record the next one.

So we're going to get into that. Obviously all that's left for me to say is you are awesome. Created awesome. Always like to finish the podcast off with this positive note.

It's just a burden you have to bear. Sadaf has to bear it. I've got to bear it. You've got to bear it too. Have a fantastic week wherever you are in the world.

I see that all the music's finished already. I talked way too long. Have a fantastic me Play it again. There we go. Have a fantastic week. It's the high professionalism here, ladies and gentlemen.

Have a fantastic week wherever you are in the world. We'll see you next time. Bye for now. Sa.