Grow My Profits: Great Big Leaps with Teeny Tiny Changes

The “Grow My Profits” Study: Meet Our Participants

Last fall we sent out a call to HammerTap eBay sellers to participate in our study. Because we wanted to see the effects research can have on a large spectrum of sellers, we selected three eBay sellers, each at different selling levels.

Bryan
Bryan knew he needed some new direction with his sales, because his success rate was extremely low. Because of this low success rate, Bryan had never reached the PowerSeller level. One of his first goals when he began the study was to become a PowerSeller.

Leslie
Leslie was already a Silver PowerSeller when he began the study, but he wanted to become a Gold PowerSeller. He and his wife were making a nice living entirely on eBay, but he felt like he could make even more.

Tim
Tim was already a Gold PowerSeller when we began the study. But, that didn’t stop him from experiencing hefty improvements in his business during the study. With steady product sources, Tim was looking for ways to grow his bottom line.

How Did They Do It?

Now that I’ve got your attention, I’m sure you want to know how they did it. And don’t think that it was some big complicated business or sales plan. Their success is attributed to one thing: Making every listing count with research!

What do I mean by making every listing count?

Let me explain by giving you a hypothetical situation. You found an amazing deal on ionic air purifiers, and so you buy five of them. One of them you keep, and you plan on selling the other four on eBay.

You list the first purifier and make $10 in profit. The next week, you list the second purifier with what you think are slight improvements to the listing and only make $7 in profit. The next week you list the third one the exact same way you listed the first, and make only $8 in profit. Still trying to get back the high of $10 in profit, you list the final purifier completely different than the previous three and make $18 in profit.

In the end, your grand total of profit is $43, which isn’t bad. But what if you could have sold every item for the high of $18 in profit? What if you could have made every listing count? If you could have sold each purifier at an $18 profit, you would have made a total of $72, which is $29 more than your actual profit.

More than a Million Ways to List

With your auction, there are a more than a million different ways to list an item. For example, multiply possible closing days with possible auction types, with listing features, with categories, with listing duration, with keywords…. Well, you begin to get the picture. Each new digit adds an exponential increase in possible ways to list your product.

So how do you know the optimal combination of listing options that will produce the maximum price, making you the most money on every listing.

Simple. You crack the code.

If you can’t crack the code of the briefcase, you will never know what’s locked inside. However, not cracking the code for your listings means that you are losing out on profits that should be yours!

Do You Know What Choices to Make?

For example, how do you know which of the following options will maximize your profits?
- Category
- Listing Title Keywords
- Gallery Picture
- Starting Price
- Listing Type
- Duration
- Starting Day and Time
- Ending Day and Time
- Listing Features

If you have never sold an ionic purifier, then you have no idea which combination of the listing options will bring you the highest price. However, even if you have sold hundreds of purifiers, the perfect combination this month is not always the perfect combination the next month. Research helps you crack the code and make every listing count, no matter how many times you may have listed it previously.

Research Grows Your Profits

With research you can find out what combination of listing options increase your sales price and grow your profitability on every listing.


Figure 2 - Research results for Ionic Purifier. Copyright 2007, HammerTap.

All of the listing options above bring you the highest sales price.

Let me just explain a few things. First, the best Listing Type is a regular auction with a BIN (Buy it Now) feature. Because of this, people can buy the item immediately without waiting for the auction to end. In that case, the Start Day is more important than the End Day. And the best Duration was “Other” indicating that when buyers used the BIN feature, it ended the auction early, making the duration different than the regular 3, 5, 7 or 10-day auctions.

The important thing is to pick Sunday as the Start Day, and make your initial duration long enough to last until Thursday.

Making Every Listing Count

Bringing everything together will really help you see how research truly can grow your profits.

Remember from the start that we made $43 in profit? However, if we would have made $18 in profit, we could have made $72.

After we have done the research and have done everything to maximize our sales price, we can expect to sell every listing for $95.22, which is the average sales price of all the listing options and keywords we used from the research.

Now, with the cost of the product being $60, we have increased our profits to $35.22 per sale. And of course, with research we are making every listing count, so we now increase our total profits to $140.88!

By cracking the code for these four ionic purifiers, we increased our sales from a total of $283 to $380.88. That is a 35% increase in total sales. Not bad for five minutes of your time.

But, here is the kicker! Our profits went from $43 to $140.88, which is a 228% increase in profit!

Bryan said:
“My cost cutting measures have allowed me to make about the same amount of profit with less work and expenditures.”

Tim said:
“Because I have been able to cut back on the number of auctions I am managing, I have had more time to research my product life cycles, new products to sell, and my competition.”