Attachment Rates
Few businesses sell only one item. The reasons vary, but here are the most common:
- Customers want choices, and they want to combine purchases into one shopping trip. Think Super WalMart®.
- Few products are truly standalone products. Almost everything you buy has something that goes with it.
- Accessories and add-ons generate more revenue for the seller. In fact, sometimes the ‘add-ons’ generate more revenue than the main product.
- A large inventory of products gives the business a sense of reliability and stability.
- Some products are highly price sensitive, so additional product offerings help the seller differentiate it’s offerings from that of competitors.
So selling multiple products is good, and helps generate additional revenue. Now the question is: what products to sell together and at what price?
What is an Attachment Rate?
Also called “product affinity”, attachment rates simply measure the rate at which one product sells with another. Real life examples:
- Your local burger joint - want fries with that?
- The electronics store - don’t forget batteries.
- Your computer store - Add on RAM, extended warranty, software, etc.
A person buys product A which naturally leads them to buy product B. You get the idea. Your job, as a seller of multiple products and services, is to determine which products are naturally purchased together, and use that natural purchasing inclination to increase your revenue. You can do this by presenting these products in such a way on your storefront that encourages the customer to buy them together. This could mean simply ‘bundling’ the products in the same sales space, offering one product at regular price and putting the complementary product on sale, or even putting the primary product on sale and offering the complementary product at regular price.
You know how to price test from the previous blog article. You increaese or decrease your pricing, and measure sales to see whether you can sell more or less product at each price. You multiply the quantity you sold times the profit for each unit to find the right combination of pricing and volume sold to maximize your profit. Attachment rates work just the same, except now you incorporate additional products into your calculation.
Example: Last week I sold 100 domains at $10 each. I also sold 10 email accounts and 15 hosting accounts. My email attachment rate is 10% and my hosting attachment rate is 15%.
10 email accounts divided by 100 domains = 10% email attachment rate
15 hosting accounts divided by 100 domains = 15% hosting attachment rate
Now let’s assume the week prior, I sold 130 domains at $8 each. That same week I sold 25 hosting accounts and 13 email accounts. For that week then, my email remained at 10%, but my hosting attachment rate jumped to 19%.
How do I use attachment rates to increase my revenue?
What does this mean? What should I do next?? Attachment rates tell you that the more domains you sell (at this lower price point), the more hosting you sell (your hosting attachment rate actually increased), but your email attachment rate remained steady. You should position your hosting along with your domain sales to increase your attachment rate to hosting, thus increasing your revenue.
So how do I do that? On your custom home page, you may choose to show domains and hosting as a ‘bundle’ in the same section of your page. This puts the idea in your customer’s mind to buy them together. On your storefront home page, choose either domains or hosting as your primary product in the Design Wizard. The one that isn’t your primary product should be your first item in the right sidebar.
Your storefront was built with attachment rates in mind. We’ve studied long and hard, and based on our findings, we’ve set up cross sells throughout your storefront and the checkout process to maximize your revenue by increasing your attachment rates. We make it easy for your customers to purchase complementary products at the same time they are purchasing the product they originally came to your storefront to buy.
So play around with this. Change the order of items in your storefront sidebar. Change the feature product on your storefront home page. Test the layout and organization of your products on your custom home page. You might even try grouping different products together. But the same rules apply here as they do with price testing: measure one thing at a time, and don’t test around holidays.
Good luck! And, as always, I wish you success and sales!
Stace
PS – Special thanks to Will for helping me with this article. Thanks, Will!
OK Very Nice. Now I wish I can sell even two domains. Marketing was very persistent to sign me up as a re-seller. So I signed up I managed to sell 1 domain to a friend. I am out $150 with google. When I search all the keywords that I advertised with My domain does not even come up. So here I am waiting for someone to notice GoChief.com and buy a domain from me.
Oh Well.. I guess I'll just wait.
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I checked out your web site. I'm wondering... why don't you have a custom home page? Are you doing any advertising other than with Google?
Stace
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"So here I am waiting for someone to notice GoChief.com and buy a domain from me."
Hey Chief,
You CAN'T just "wait" for someone to happen by and buy from you! It could happen, but not enough to make any money. First, lay out a plan. What is your goal? What is your target market? Is there a niche out there that I can target and market specific products to? What am I going to charge? Ask yourself a bunch of questions and write them down! Do some brainstorming, surf around and look at the competition, see what they are doing, what they are charging. How are they presenting the products? ANY business takes effort, even on the net! Especially on the net :O First off, forget the cookie cutter site you get, there are way too many listed in search engines and they are all really the same. If all you can do right now is use the one page website tonight account you get, then maximize that and craft it very carefully to attract visitors, use the traffic blazer account you get with it. When you get customers, use the Express Email Marketing account you get and start promoting/announcing products to the list. Even better though is to build your own web site and take the content all the way to the "add to cart" stage and link into the system on your reseller site. Let me give you another tip: Get some biz cards and letterhead made and start with local small businesses in your area. you will be amazed at how many do not have a site! Try to find their domain name using the whois on your site, and if it is available, crank out a letter with your card telling them, " Hi neighbor, this is Chief from GoChief.com, just wanted to let you know that your company web domain name is available! localcompany.com and I strongly recommend you grab it now! For only $xx.xx you can register it today. Better still you can get that name for only $1.99 when you purchase a web site account! etc. etc....
Start local and branch out! Look for local web directories that list businesses for free and get in there. Also get a list for offline marketing, which can be as important as online marketing. $150.00 is nothing as far as investing in your business, but you can still do it all for very little money. Be creative, create an affilliate program and sign your friends up.
I have been in this a couple of YEARS now and I am only JUST NOW putting it all together :O
Go get em Chief!
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WOW!! names24hrs I have a long way to go. I guess I will start advertising on classifieds while I am tinkering with modifying the website. The reseller site seems so darn complicated that I dont know if I could make one that has all the functionality.
Are there any other custom reseller websites I can look at so i can get some Ideas ?
Thanks A lot to all fo the advice.
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Some great ideas on making your reseller account work. That is right along the same line as what I do and very valuable what names24hrs says. I'm just a little guy running a 2 person business here but this is no hobby for me it's my only source of income and has been for years. I only wished I had of signed up on the reseller part long ago as I have been doing web sites for 5 years now and cringe thinking of all of the revenue I lost to outside hosting. But I signed up last year and I am averaging about $100 a month from my reseller account. Small potatoes yes but it's paying for itself and growing every month as I slowly convert and sign up my approx. 300 customers. Nice thing about it is once you sign someone up they stay on every month. But I will tell you this. I have not had one customer log into my site and sign up! I go out there and sell the customers locally and I walk them through the site and sign them up, manage their account, design their site, everything. Not one would know how to log into their account without asking me since I do it for them and they can't be bothered. But then this is only a small part of my business as I also maintain a company virtual server and have about 50 domains hosted there and growing. Main thing is you have to sell. Get in there and fix up all of your prices and keep them low the competition is fierce. I charge seven bucks for hosting that keeps me below most of them out there. Sure I only make about 3 bucks on an account but it starts to add up fast.
My philosophy when I started this business was if I could just be sure and have the lights and gas and phone, you know all the utilities paid for each month without worry the rest would come easy. Right now I am making over 35,000 a year doing this stuff but its because I am well diversified between design work, hosting, consulting and the like. You have to eat, breath and sleep this stuff but it beats "working for the man". I'd say learn how to design web sites well and quickly then start there. The hosting then comes naturally. I built my business by undercutting my local design competition by over 60% in cost, they'd grown too top heavy and had so much overhead to pay for and I was lean and mean and still am. So where my local competitor would charge 1500 for a site I would charge 500 and then hold the customers hand and give them personal service. I also targeted everyone who was afraid of being on the internet and made them a deal they couldnt refuse like a few hundred bucks or less for a nice basic site. Pitch them on the fact that with gas prices the way they are everyone should be on the net even if you are not selling something on your page at least you are getting the exposure and can build it from there and for only $200 and a few bucks a month its cheaper than one ad in the newspaper. Sell 5 of those a month and you can make a living eventually. Then follow through with great service and good work. Just an idea, something to think about.
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[quote]But then this is only a small part of my business as I also maintain a company virtual server and have about 50 domains hosted there and growing.[/quote]
Hmm... I just wondered, why didn't you use a virtual server from your own reseller store?
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Same here, I do a search and never see my ad. I've sit here for 30 mins one time entering different words, even did a search of my site with the full url and nothing. Although, google claims that my ad as been seen 5800 times with 10 clicks to my site. I'v entered my ad in a number of different areas and soon I'll be selling 100's a month right? I did this mainly as a hobby so its no big deal. Would like to get one sale though
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That seems odd. I type my url in Google (both with and without the www) and my site is the only result returned. You may want to contact Google tech support and see what the deal is.
Stace
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What do you suggest Stace. I am really new to this.
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names24hrs gave you some great tips. I would do everything he said. I'm even going to take his ideas and use them for my own store!
What else can you do? First thing is to find a niche market and start advertising in that market. Depending on your budget, you may want to buy ad space. If you don't have a big budget, do what I did - search the net for sites that let you put up a free link. You can't have customers without traffic. I would focus on getting traffic - the customers will happen naturally.
Try some of these ideas and let us know how they work.
Thanks,
Stace
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Hey Chief,
All good stuff! It's one thing to put up
a store front (re-sellers or not), send thousands of visitor's to it, and hope
and pray that someone buys from you.
Its another to set up a catchy splash page, or target page, then get them to click through.
My advice, would be to set up a website, something that interests you, and that you know all about, and advertise your re-sellers page there in the form of a ad or link.
Even if its using website tonight, your
more apt to get someone to purchase
something from you when you get their attention, and possibly return visits.
Sell them on the back end per say. Even people interested in model rockets like
to show off their stuff, so wouldn't it
be nice if you provided a way to that too, if you get my direction here.
Regards,
Robert
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Having attachment pricing is a good idea, but overselling attachments is annoying and low class.
I wish the Reseller Control Center would allow us to turn off the page2 and page3 of pushing product on someone when they add an item to their cart. It is annoying.
It is also confusing. I do not want my customers to be tricked into buying something that they do not need.
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I hear what you are saying, but I don't think the cross sells on the storefronts 'trick' anyone into buying anything. Yes, cross sells are a way for you, as a reseller, to generate more revenue. But there's also another side - cross sells show products related to the original product that the customer may not have been aware was available.
Our product line is geared to work together. Your customer may not realize the need for another prouduct if it's not presented in a particular way. So yes, cross sells do generate more revenue for the reseller, but they also educate the customer on how different products work together and can benefit them.
Please email me directly at stacey@resellerroundup.com. I'd like to discuss this further with you out of the blog.
Thanks,
Stace
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It would be good to have a discussion on marketing and promoting of our stores on a shoestring budget. It is something I am interested in because we are in similar situation of not getting much traffic and not knowing the best way to promote our store so that it will not break the bank. I would invest in on line advertising that I knew would have a good ROI. I have tried some free advertising, some link exchanges, search engine submission, and some paid inclusion. We have not gotten any sales from the above activities. The only sales we get are from local personal contacts with our computer service business. This probably a very big topic on most of our minds that would be a good discussion here or in a podcast.
Thanks,
Kevin
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I completely agree, Kevin. I'm trying to do the same thing - find effective advertising that fits my budget AND works!
Resellers - post your ideas here, or email me directly at stacey@resellerroundup.com and I'll compile a list and post it.
In the meantime, I'll do some investigating and see what I can find.
Thanks,
Stace
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Doing business on the Internet is a wonderful thing. It has one great advantage - the whole world is your market. Only your imagination is the limit when deciding what kind of product or service is the best bet for the future. Doing business on the Internet, however, has one great disadvantage. Your competition is from all over the world. The situation is even worse when it comes to such overcrowded market place as selling domain registrations and web hosting. There are hundreds of ICANN accredited registrars and hundreds of thousands of domains and hosting resellers all trying to make a buck.
Having said all that, let me ask a question. We are all competitors here, right? Stacey, how many reseller accounts do we have at present? On top of it, we all sell absolutely identical products and services from absolutely identical storefront (except API resellers, but this is another story). Why do you think I should share my selling 'secret'(if I have one) with all my competitors on this blog?
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In the whole big picture of things, yes, each and every reseller is in competition with every other reseller. However, many resellers have specific customer bases or niche markets they depend on for their business. So in that sense, the competition is much less fierce.
For example, I'm marketing the horse industry, and more specifically, small horse operations, folks whose hobby is horses, and folks in the Midwest. Unless another resellers is marketing to that exact same market, I don't feel I'm in competition with them at all.
In addition, I truly believe there is enough business out there for everyone to have a piece of the pie. If you're willing to work hard, study and learn about internet marketing you can be successful.
That said, you're certainly under no obligation to offer any secrets about how you make your business work. And you shouldn't feel any pressure to do so. Some resellers are comfortable sharing ideas and tips that have worked for them, some aren't. You have to do what makes you comfortable.
What's important to me, is that you're participating. You're throwing out ideas and stimulating conversation. That is what Reseller Roundup is all about and I thank you for being here.
Thanks for your comment.
Stace
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I agree. I have tried so many different advertising campaigns, and zero clients.
I have had potential customers choose one of the big companys instead, because they wanted to "research" my storefront before commiting, and found one of the big companys instead.
I'm sorry , I don't have millions to spend, and google adwords is Garbage. You will be presented with a huge bill for supposed clicks, meanwhile multiple statistic tracking packaged will show no access to your site through those links.
Rant over. Reality bites.
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Impressive. These comments are wonderful and I wish I had access to these before I signed up. Can I get any help with the affiliate program. You see doing business on the internet could be tricky especially when trust and money is involved. As I am new to the internet marketing arena, with resolve, hard work, creativity and peseverence, I know I can breakthrough. The difficulty I have is that if I sign up an affiliate programme, how do I incorporate the link on my frontpage and how do I monitor the sales? I know the programme runners are middlemen but I feel comfortable...for now only with the Reseller Control Center. Can go the Reseller Control Center be my go-between, sort of to make sure I do not work hard for some other rich net millionaire somewhere?
The second issue is the prices. Can we get a custom page in other currencies? That would be good even if it is only the major world currencies.
Third, I would love to tap into places like China, Singapore,possibly Japan but the page I have is only in English. what can be done?
Do my customers get to use this blog too?If so, how?
PS:I am sorry for all the questions.You can edit what you feel is innapproriate for the blog. I do not mind and I am sorry if I have written anything wrong.
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Your comments are fine. We're here to answer your questions....
I'm afraid you'll have to go with your gut on which affiliate programs you wish to participate in. While we list a few options in the Reseller Control Center, we don't specifically endorse any program.
When you sign up with an affiliate program, user typically 'join' your program through the parent affiliate, not on your site. Check out the Affiliate Program page in the Reseller Control Center under Marketing Tools. There is a great explanation of how it works. If you still have questions, don't hesitate to call support, or email me directly.
We currently don't offer multiple language support for the reseller storefronts. However, I am sending all requests for this feature in for consideration.
The Reseller Roundup Blog is specifically for resellers, not your customers. But I encourage you to set up your own blog and link your storefront to it. It just gives your customers another reason to visit your site.
Thanks for your comments,
Stace
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Anyone experiencing a significant drop (more than 300%)in impressions and PPC commissions reported on RCC for May compared to April?
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The company has recently increased the storage space on shared hosting accounts to economy = 20GB, deluxe = 50GB and premium = 100GB.
Us resellers are still sitting at 20GB max, at prices MUCH higher. Are the reseller accounts going to be restructured so as to be competitive? At this time, I don't even have any reason to use my own hosting products.
Roger
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Another strategy is to stick to a traditional business model and use your reseller acct as a marketing tool. I know this may seem confusing. You can check out my storefront and see how it's structured. There's a link to Web Templates and a link to my Corporate Site. Your storefront can very well be just another store in your mall...
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