Thread by @HQawiyy

The Hidden Secrets Your Favorite Guru will NEVER Tell YOU about ECOM you MUST know to SUCCEED

you’ve probably came across those guys who who showed off big revenue numbers, and a month later they disappeared...

There are multiple possible reasons for this happening, but my theory is that some of them have that “100K in 30 days” revenue, but 150K in fulfillment, ad spend and fees. ‍

To avoid crashing into a negative ROI brick wall, you should price your products right from day one!

There are some misconceptions regarding proper product pricing in the early stages for some people, who price the products super low to make sales no matter what - an act that might turn off people who don’t want “cheap” products around them.

Funny enough, the lower you price your product the less “buying quality” people will be drawn to it.

TO BE CLEAR: I’m not talking about cheap cat necklace rings crap, puppy hats crap etc..., I’m talking about UNIQUE products that you don’t need to be ashamed to price right - meaning pricing it higher than you intended to initially. Don’t exaggerate either, be reasonable.

If you are trying to promote cheap cat rings and other oversold crap - just stop. This thread is directed at people who promote unique, attractive and high quality products, and how you can price them correctly from day 1.

If you are targeting an “impulsive” audience that you know will only buy once and never return again to your store, you can raise prices of your products as you go.

However, returning customers might be deterred by suddenly spiking price changes, so avoid the panic that hits when you scale and suddenly realize you are no longer profitable and must raise prices asap!

If your store is a conversion machine, your audience is passionate about

your niche and buying-intended, AND you have a highly converting offer - you don’t have to be afraid of pricing a unique and beautiful product, even if it’s a POD (print on demand) product, with a high price that will match the uniqueness and quality of that product.

To look at the fulfillment price and simply add an extra 10-15 dollars to it “just like that” is not professional - you may not be able to cover your bases with that difference.

Here are the major factors that you MUST take under your consideration when you are pricing any of your products:

Fulfillment - The price of the product at this current stage and time might be X amount of money. When you keep selling this product the following might occur:

The seller might raise prices - it has happened to the best of us. Even if you think you have a good relationship with your seller, they might pull a quick move and raise prices regularly in small increments.

So after 2-3 months, all of a sudden a $14 product has turned out to cost so much more. Even if the prices go up by $2,$3,$4 - it is still something that you have to prepare for in advance from day 1 with the proper pricing!

For products that cost more, be prepared for bigger price jumps.

The seller might suddenly be out of stock - it can happen anytime, so in order not to close your scaled campaign or hurt your consistent sales, you will have to look for the identical product but from a different

seller, who probably sells your desired product for a higher price (you go with the cheapest from the get-go, right?).

But you won’t have a choice - people already ordered from your store and you have to fulfill!

Some sellers sell identical merchandise but with a small change in price, it might be between $1-$4 or even higher gaps if you promote a more expensive product.

Marketing - Cost per acquisition will naturally increase the more you spend, whether by scaling your product, or by reaching the limits of your product’s lifetime. When marketing your product the following will raise your costs:

When you are scaling and duplicating and spending

more money daily on a certain product, with the purpose of bringing larger quantities of sales per day, you will have to outbid the people who are competing on the same marketing real estate, which will result in higher cost per purchase.

There is no solid number for the rise, it all depends on the bid, audience size and price of the product.

Even if you are not scaling drastically and all you want to do is to keep selling your products for as long as possible - the longer you run your ad the more you will saturate your audience.

It doesn’t matter if you are targeting a 300K “interest” audience or a 10% LAA (Look

Alike Audience) - the audience will be fed up with your offer sooner or later, the frequency of your ad will grow, the relevance score will decrease and eventually you will have to pay more for the same amount of impressions that you had previously, which will result in more ad

spend for the same amount of sales.

Of course products that cost less will be “cheaper” to draw and convert your prospects.

However, keep in mind that ALL products will suffer from increased costs, regardless of whether they are the cheapest or the most expensive products, and to prolong the life of those products (whether in the scaling stage or not) will cost you money. This is a natural process.

Fees - They are the silent killer of ROI that will chew on your revenue hard if you won’t notice it on time. Add an average number of $ to each product according to the fees that you will pay on average to cover yourself.

If you sell 10 products - you may not feel it… If you sell 10,000 - you WILL feel it. Here are some factors to take a look at:

Shopify takes fees per each transaction.

Paypal/any other processor takes fees per each transaction

Some fees may apply when you fulfill using your

credit card - per each charge you might be charged with a tiny fee and if you fulfill a lot of products with your credit/debit card you might get hit with the fees, especially if you live in a foreign country and you have to pay extra for the conversion fee.

Bank fees - per transactions
Apps such as Signifyd or any other app that takes some commission per each transaction

Fixed Charges - anything that you pay a fixed cost for, starting from your designer, coder, your VAs and everything else must be paid for off your product sales.

Keep that in mind as well. All your apps, tools, platforms etc… must be paid off your product sales as well!

Taxes - Don’t forget that you will also have to pay business tax, personal tax (and VAT in certain cases) on your revenue, which will leave you with less pennies in the purse.

If your business is incorporated in country X, and you are selling to people who are residents in country X, you will also have to pay VAT on each sale, which cuts even more into your profits.

Make sure to figure this out before you start selling, as it has to be priced in too.

Coupons/Discounts - If you plan on giving X% discount to some or all of your customers, make sure to price this in as well!

Focus on making your ROI positive fellas!

you don’t wanna get your hands burned in e-commerce..... do you?

Your favorite YouTube gurus will never tell you what goes into building a successful brand cause all they’re are after is views

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hopefully you learned something useful you’d share with someone today!!!

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