in the daily management of
Dec 2, 2023 3:24:34 GMT -6
Post by account_disabled on Dec 2, 2023 3:24:34 GMT -6
our advertising, because it allows you to have a direct view of the money we earn. If your MC1 is too low, that doesn't mean you can't advertise this business.What is a good Contribution Margin 1?Based on my experience and discussions I've had with experts in the D2C model , here's what I've learned:We are aiming for a turnover margin excluding .
tax – COGS > 75% of turnover excluding tax. In other wo Europe Cell Phone Number List rds, if the COGS represent more than 25% of the sales price excluding tax, we can already say that our margins will be reduced (even if we can make up for it elsewhere)We aim for an MC1 above 55% of turnover excluding tax (or more)I advise you to follow the evolution of youracquisition via advertising platforms such as Facebook, Google, Pinterest, etc.5. Average shopping basket (AOV)AOV = Turnover excluding tax ÷ Number of ordersOne of the most important indicators for an e-retailer
is simply the amount spent by a customer on each transaction, on average.In other words, if your average shopping basket is lower than your cost per transaction (CPA), your campaigns are not profitable.Obviously, your ultimate goal is to see your average shopping basket increase over time. It is even necessary with acquisition costs which are constantly increasing.
For information, here are the average shopping baskets of French D2C brands in 2022 and the customer acquisition costs (CAC) classified by sector of activity according to the study of the 2023 DNVB barometer carried out by the DNG .We observe that the average shopping baskets are obviously higher for the “accessories” and “home & decoration” sectors. Conversely, they are lower for “food & drinks” and “well-being & cosmetics” brands (where recurrence is greater).We can then observe the average CAC by
tax – COGS > 75% of turnover excluding tax. In other wo Europe Cell Phone Number List rds, if the COGS represent more than 25% of the sales price excluding tax, we can already say that our margins will be reduced (even if we can make up for it elsewhere)We aim for an MC1 above 55% of turnover excluding tax (or more)I advise you to follow the evolution of youracquisition via advertising platforms such as Facebook, Google, Pinterest, etc.5. Average shopping basket (AOV)AOV = Turnover excluding tax ÷ Number of ordersOne of the most important indicators for an e-retailer
is simply the amount spent by a customer on each transaction, on average.In other words, if your average shopping basket is lower than your cost per transaction (CPA), your campaigns are not profitable.Obviously, your ultimate goal is to see your average shopping basket increase over time. It is even necessary with acquisition costs which are constantly increasing.
For information, here are the average shopping baskets of French D2C brands in 2022 and the customer acquisition costs (CAC) classified by sector of activity according to the study of the 2023 DNVB barometer carried out by the DNG .We observe that the average shopping baskets are obviously higher for the “accessories” and “home & decoration” sectors. Conversely, they are lower for “food & drinks” and “well-being & cosmetics” brands (where recurrence is greater).We can then observe the average CAC by
