On July 15 1848, a Italian baby was born by the name of Vilfredo de Pareto.
As young Vilfredo grew up, he became fascinated by patterns in human society.
One day, he stumbled upon a very odd factoid: 80% of the land in Italy was owned by 20% of the citizens.
"Why is it so unevenly distributed?" he wondered.
Digging deeper, he saw this pattern everywhere:
- 80% of the violent crimes are caused by 20% of criminals
- 20% of the peapods in his garden produced 80% of the peas
- there was a small handful of Italian companies making most of the revenue
Today, we call this pattern the "Pareto Principle" (aka the "80/20 Rule").
In honor of our friend Mr. Pareto, here's my "80/20" of Seller Central.
My goal is to show you: as an executive, what 20% of Seller Central pages can you look at to keep a pulse on your Amazon business?
My big 3:
Page 1:
Reports > Business Reports > filtered by Year to date
The blue line shows sales so far this year. The red line shows last year. From these two lines, you can answer the questions: how are we doing compared to last year? How are we doing month on month? Is the business growing, stagnant, or shrinking? Where are our seasonal trends?
Page 2:
Reports > Business Reports > Detail Page Sales and Traffic By Child Item (use a 90d date range)
This report breaks things down 1 level further, giving you performance by individual SKU. Two columns to check our are "Ordered Product Sales" (that's sales per product) and "Unit Session Percentage" which is basically your conversion rate per product. Anything less than a 10% Unit Session Percentage is generally a sign that the offer/listing needs to be improved. A good USP is 20-30%. Best-in-class is 50-60%.
Page 3:
Advertising > Campaign Manager
This report shows you how many of your sales are coming from ads, and how expensive it was to get those sales. Put 3 metrics on the graph: Spend, Sales, and ACoS.
Spend is how much you spent on ads for the selected time period.
Sales are your sales that came specifically from ads.
And ACoS is your spend divided by your sales (and is a representation of how "efficient" your ads are running).
An ACoS of 20-30% is fairly standard, but can be higher or lower depending on your margins. And, a high ACoS isn't always bad. If ads are driving organic sales, it can be good!
Interestingly: if you subtract your ad sales for the period from your total sales (from business reports) for the same period, you can see how many sales you got organically!
(assuming you weren't running other types of traffic to Amazon)
Rooting for you,
Pat
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