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Digital Corner: Learn Basic Website Analytics for Jewelers

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In a previous article, we discussed 5 Free Tools From Google To Further Your Marketing. Google Analytics is quite possibly the most important tool in that list.

Last time, we briefly talked about the new Analytics Intelligence feature that helps you get answers about your website just by typing questions into Google Analytics. Today, we’ll go a bit further and discuss the benefits of the basics that you need to know to start using Google Analytics in a way that is helpful for your jewelry store business.

Website Pageviews

Your most viewed pages tell you what people see most when they come to your site. You can view the Pages report in Google Analytics by going to Behavior > Site Content > All Pages.

What’s Typical. On most jewelry websites, the homepage is the most viewed page. Google Analytics indicates the homepage with a forward slash symbol (/). While this is typical, and also an OK thing, your other pages are often more valuable. When people are searching for specific products like engagement rings or watches, it is better for them to arrive on a page that relates to what they are looking for.

What To Do. Watch for increases in traffic on pages that are specific to areas that you are trying to promote. This may indicate the success of your marketing efforts.

Traffic Source and Medium

The Source/Medium report in Google Analytics is where you can see where visitors are coming from. This helps you to know how much traffic you’re getting to your website from places like Google, Facebook and email campaigns.

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“Source” usually refers to the company or property that sent the traffic to your site. You’ll see words like “Facebook” and “Google” here. The “Medium” refers to the type of platform the traffic came from. You’ll see words like “organic,” “cpc” (cost per click) and “email” here.

You can view the report by going to Acquisition > All Traffic > Source/Medium.

What’s Typical. For most jewelers, the top source/medium is usually “google/organic” and “(direct)/(none).” The former refers to non-paid traffic that you get from Google. SEO can help to increase this traffic. The latter can either be visitors who directly type in your website or visitors that Google Analytics doesn’t know the actual source/medium of.

What To Do. Watch for traffic from paid advertising sources. Although this traffic is typically much smaller, it is usually more valuable. This is because you control the message in your paid advertising. You can prepare visitor expectations and direct traffic to the appropriate pages.

Keep in mind that traffic from social media sites like Facebook is usually low, even if you pay for advertising there. Usually, people are on social media to spend time on social media. They are less likely to click links that take them away from it. In general, it’s better to use social media for brand awareness.

Combining Pageviews and Source/Medium

If you want a little more detail about your reports, you can see your pages broken out by source/medium or vise versa by using the “secondary dimension” button. Just click the button and select from the options available.

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If you are on the Pages report, you can select “source/medium” under “secondary dimension.” Now, for example, you can see how many visitors to your homepage came from your Google ads.

Moving Forward

Truly learning Google Analytics feels like an endless pursuit. It’s no wonder that Google offers a certification for it even though it’s a free tool that’s available to anyone. This, however, is a great start for any jeweler who is curious about looking at and understanding their own website traffic data.

Remember to keep any special promotions or website issues in mind when looking at these numbers. Sometimes things can look different from what you would normally expect for a very understandable reason that requires information that Google Analytics can’t give you.

Charles Pobee-Mensah is the director of digital marketing for Fruchtman Marketing. Contact suits@fruchtman.com.

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Jewelry Store Owner Rewards Her Staff With the Ultimate Adventure

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Editor's Note

Our Big Survey Seeks To Answer Why Some Jewelers Thrive While Others Die

Why are some jewelers thriving while others are going out of business? In this issue, we seek answers.

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“What’s the secret? Why are some jewelers thriving while others are going out of business?”

We receive letters with some variation of this question at INSTORE every month. In this issue, we seek answers through our 12th annual Big Survey. This time, we sort more than 700 responses from jewelry store owners around the country into three categories: average stores, struggling stores, and thriving stores (without naming names, of course). Then we seek the common thread tying each given cohort together.
Spoiler alert: the most successful stores are the ones that have embraced the millennial client. That means a concerted focus on digital marketing including social media and SEO. It also means more opportunities for customization and an emphasis on unique jewelry with meaning. Some stores have been willing to change with the times for a new clientele; others haven’t.

We also saw that thriving stores spent more of their own time on business strategy and marketing and less on bench work and sales than their struggling peers. So many owners get caught up in the day-to-day that they don’t take the time to make a plan for growth (and advertise to get there).

At the end of the day, the “secret” isn’t really much of a secret at all: those who seek to be the best merchants they can be — willing to sell whatever the client may want to whomever the client may be — are the ones who prosper. But there are many ways to get you there, and you’ll find quite a few in the pages of our Big Survey.

Trace Shelton

Editor-in-Chief, INSTORE
trace@smartworkmedia.com

Five Smart Tips You’ll Find in This Issue

  • Print business-sized cards to throw into the customer’s bag saying to like your store on Facebook and give a review. (The Big Story, p. 63)
  • Text your clients every six months with the message, “Reminder! It’s time to get your jewelry checked and cleaned.” (The Big Story, p. 63)
  • Send each client their birthstone on their birthday along with a gift card toward custom design or mounting. (The Big Story, p. 63)
  • Bag each purchase into a custom canvas-printed bag that your clients can reuse. (The Big Story, p. 63)
  • Put morning duties on flash cards and have staff pick which card they want as they arrive (last person has to take two). (The Big Story, p. 63)
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David Brown

Why Warren Buffett Places So Much Trust in Emotional Currency — And How Your Store Can Get It

It’s time to create a “moat” around your prices.

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He’s long been considered America’s foremost investment guru, and given the returns achieved by his company, Berkshire Hathaway, it’s easy to see why. Understanding what Buffett considers to be a good business can shed light on how to improve your own business strength — to put, as he calls it, “a moat” around it to ward competition away.

Hearing his theory on business value is well worth doing, whether it’s his annual Berkshire Hathaway meeting or other snippets of advice the media shy guru may drop. It’s his take on business value from a commission investigating the financial crisis back in 2009 that recently caught my attention.

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When asked about his investment in the ratings agency Moody’s, Buffett had the following to say:
“If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. And if you have to have a prayer session before raising the price by a tenth of a cent, then you’ve got a terrible business. I’ve been in both, and I know the difference.”

Buffett went on to discuss his belief that good management can’t save a bad business, but a good business can continue no matter what management does.

Moody’s represented a case in point. Because of their duopoly with Standard and Poor’s as the benchmark of rating agencies, they effectively had a business with a moat around it. Even if a competitor came in offering ratings at half the price, both Moody’s and Standard and Poor’s had created a business that would not suffer. Price increases or decreases would make no difference.

In a jewelry industry where pricing competition often seems to be the only thing that customers are concerned about, it raises the question, “Can a jeweler successfully build a pricing moat around what they offer?” Moody’s and Standard and Poor’s perform a task that others can do but no one else can do it with the prestige of having their name attached — and that makes all the difference.

On the face of it, it may seem difficult to achieve this level of power when selling a commodity that can be purchased elsewhere — yet jewelry is an emotional buy. By definition, you should also be able to achieve an emotional moat around the association of your name to the process. Tiffany has achieved this — however, is what they are offering any different to what you or other jewelers able to provide? Does the customer gain any form of tangible benefit, or is it a feeling based on emotion?

Just because it’s intangible doesn’t mean it’s not real. The ability to increase prices and have your customers accept it because you are the only feasible option is priceless — the number one thing Buffett considers when investing.

If it’s worthwhile for Mr. Buffett to consider it for his major investments, it’s worth you considering for yours.

 

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David Geller

If Your Sales Are Acceptable But You Have No Cash, Look At Your Inventory

It’s an extremely simple formula.

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“IF I MADE that much money, where the heck is it?”

After getting one’s tax return back from the CPA, this is the usual question. Jewelers often tell me they aren’t making any money when, in fact, most I help do make a profit in the store.

But making a profit and having money are two completely different things.

Let’s just talk jewelry sales. If you sell $500,000 and earn keystone, your gross profit is $250,000.

If expenses are $200,000, then your net profit is $50,000, which is 10 percent of sales. Awesome!

“But I have no money!”

Easy. Look at how much inventory you have. At keystone, the amount of inventory you should stock is about equal to your gross profit from selling jewelry. So, if your gross profit was $250,000, then $250,000 should be about inventory level. If inventory is $400,000, the extra $150,000 (which you’ve been overbuying for a few years) hits you in the behind.

Take that $150,000 “too much inventory” and divide by half to three-quarters (leaving either $75,000 or $110,000). Then go look at your QuickBooks or accounting program and add up your accounts payable, credit card debt, bank loans, and loans from owner.

And you’ll see excess inventory is equal to debt, give or take.

In the jewelry industry, a good inventory turn is 1.0 (one time per 12 months). For every month after 12 that stale item sits in the case, the selling price (at keystone) must be increased monthly by 4 percent to make the same amount of profit after a year. If an item cost $100 and sells for $200 and is a year old, then each month starting with month 13, you must add $8 to make up for the second year’s missing profit month-by-month. By month 18, you’d need to raise the price by $48. In two years, it would need to make you $200 instead of just $100. And just think: you could have invested that money into new inventory!

Note: If you have this kind of old inventory and have less debt, I’m betting you do a large amount of shop sales (which requires virtually no inventory) or buy/sell a lot of scrap. These are “free money” departments, requiring little inventory while throwing off good profits. But why work your tush off in one place to help pay for a debt-ridden department someplace else in the store?

Most jewelers think jewelry (including diamonds) doesn’t go out of style. Wrong. Jewelry goes out of money.

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