Hi there,
Are you ready to sign off this week? Yeah, that’s all of us.
Listen, before you do, I wanted to remind you something to just roll in your head over the weekend:
Perception is reality. Yet, someone else’s perception doesn’t need to be your reality.
Whatever you do, keep thinking for yourself. Question everything and everyone, and make sure that whatever you do, you do it because every fiber of your body truly desires it. Not because someone said so.
MEME of the week
Author’s Note: As a Nona, Muna, Mina, Nena, Naina, I cannot agree more…
This is not one of your common “sexy” metrics, but Average Purchase Value is far more important of a metric than you can even guess.
Let’s break it down.
APV (Average Purchase Value) is simply put the monetary amount a customer would spend with your business on average.
Here’s how you calculate it:
How do you use the Average Purchase Value Metric?
APV will come in quite handy when, in a few emails, we calculate Customer Lifetime Value, but even the metric on its own can be incredibly informative.
The best way to use APV is to compare and contrast different periods in time.
If you, for instance, have an online shop, the design of your e-commerce might dictate your average purchase value. Your customers may not be browsing your site or seeing suitable items, so they might be leaving with just the one main product they found via a search engine.
But what if you played around with how your website is designed so you could show them more relevant items and your APV started climbing up?
See, not all markets are infinite…
For many businesses, mainly when selling in a B2B environment, there’s a cap on the market. There are only so many products you’ll sell to your audience, and once you hit that limit, there are only two things that you can do:
- repackage your product for a new audience (market development)
- create a new product for that audience (diversification).
When you choose this second option, which is most companies’ instant “go-to”, the Average Purchase Value metric will be paramount to monitor so you can measure your success.
APV is most suitable for…
Businesses with large portfolios of products. Although everyone should measure APV so they can measure Customer Lifetime Value, businesses with tens or even hundreds of products can truly get lost in analytics if they don’t focus on APV.
Historic Data Can Inform Predictive Analytics
You can’t possibly measure all metrics in every business, but if you measure APV from the start of your business and focus, for instance, on quarterly overviews, you can easily see at which point of the year customers are most likely to spend more with you. You can also monitor how economic circumstances are affecting your business and gauge whether your tactics are actually working.
Focus on the game, not on failure
When I was a kid we used to have this game we called “Chasing”. It would often start just like that – one kid would scream “CHAAAASING” on top of his lungs and we’d all start running in different directions.
The rules were the following:
- Whoever was the chaser would try to “catch” someone by touching them
- Once you’re touched, you’re now the chaser
- If you’re being chased, you can get yourself immune by putting your palms above your head in a triangle and shouting “House” (don’t ask – it’s what the rules were)
We’d usually play this until complete exhaustion and you could hear kids genuine child laughter when we did. It was fun.
Here’s what often happened:
- Kid Type 1: Some kids would always immune themselves too early in the game by shouting “House”. Once we knew who they were, they were no longer fun to play with, so no one ever chased them.
- Kid Type 2: Some kids would run like their lives depended on it, and never shout “House”. Those are now professional athletes. I’m kidding – only some of them are, but they’d run so fast, that no one wanted to chase them.
- Kid Type 3: And some kids, would run fast and leave the “House” immunity for the last minute. Sometimes they managed to shout it on time, sometimes they didn’t. They’d risk it. These kids were everyone’s favourite.
How to be everyone’s favourite?
The reason Kid 3 was everyone’s favourite was simple: they were fun. These kids took their chance, failed and succeeded in equal measure, but regardless of the outcome, they always had fun.
Kid 3 didn’t focus on being the fastest runner, nor on always being safe – it focused on the game.
→ When it failed, it got back into the game.
→ When it succeeded, it got back into the game.
It’s the same when you’re an adult. If you’re always trying to be safe, others won’t play with you. If you’re obsessed with winning, others won’t play with you.
But if you focus on the game, you’ll be everyone’s favourite.
For years this scene has been my personal go to every time when I think that a successful person is better than anyone else.
This, my friends, is the on-stage launch of Windows 95, which is now almost 30 years ago.
Whether you like Bill Gates or you think he’s the devil, there’s no arguing that someone was absolutely brutal by asking him to go on stage…
So, however smart and successful you may be, someone can always turn you into a laughing stoke if you let them.
So, perhaps, play to your strengths, not to the beat of someone else… If you want to see the video, here’s the YouTube link.
