Some interesting Ferrit stats from this article (thanks Q). Firstly only 1.2% of the visitors in December bought anything, secondly Ferrit makes “between 4% and 8%” of each sale. (Let’s be nice and say an average of 6%). Thirdly the average order size was “more than $100”. Let’s call it $110.
So in December 2,700 people spent a total of about $300,000, and Ferrit made just shy of $18,000 from that.
I do not know how much Ferrit spent in advertising during December, but it was a lot – Ferrit had a full-court press approach, ranging from online to TV (which is really expensive) and billboards. Online ad spend would have been the most effective, but even that is not free – the online rate card for NZHerald suggest costs of at least $6000 per week for a home page banner. The December ad spend number may bever be know, but it could well be north of $250,000. or $1m. or $5m. Gee – I’m just guessing here – anyone care to provide the real number or a good estimate?
That’s not a great ROI, considering that the customers acquired do not seem to be coming back in droves.
Now let’s revisit the numbers from before.
“Given that Ferrit is on record as saying that 2% of visitors buy something, that’s an estimated 1,600 buyers in the first half of Feb (to the 15th), or 108 per day. Call it 3,500 buyers per month, at an average of say $10 revenue per buyer (I made the $10 figure up, but the average sale price is most likely between $80 and $120 from the comments in the blog entry linked above). That’s $35,000 per month in income.”
This now changes to 960 buyers in the first half of Feb (@ 1.2%), and, at an average of $6.60 (6% of $110) revenue per buyer, that’s a trivial $12,500 per month in income. That’s truly pathetic for a dot com that has been going for 14 months and with the amount of money spent.
Wake up Telecom.